Firm Releases Inaugural 2020 State of Equity Plan Management at
Private Companies Report Highlighting How Private Companies
Globally are Implementing and Managing Their Equity Compensation
Plans
Shareworks by Morgan Stanley, a leading equity plan management
platform and division of Morgan Stanley at Work, today released new
proprietary research revealing that more private companies are
digitizing their equity plans to help streamline the administrative
burden, increase transparency and communication among employees.
Despite the growing importance of equity compensation as a means to
attract and retain employees, the report found that administering
these plans remains challenging for equity plan administrators.
The new research report, The State of Equity Plan Management at
Private Companies, was commissioned by Shareworks by Morgan Stanley
to benchmark company mindsets and behaviors surrounding equity plan
management, and to understand how companies are implementing and
managing equity compensation plans. The report also provides
insights into the current landscape and industry trends surrounding
equity plan management, related priorities and challenges, the
types of plans currently offered and employee engagement.
“Our report shows that equity compensation ‒ both the practice
and profession ‒ will only continue to grow in value, significance
and impact in the coming years,” said Marcos Lopez, Co-Head of
Morgan Stanley at Work. “In a changing business landscape and a
world of economic uncertainty, it is becoming critically important
for companies to engage and motivate employees to help shape their
future and create the financial lives they want.”
Jeremy Wright, Co-Head of Global Private Markets at Shareworks
by Morgan Stanley, added, “For both employees and employers, equity
is playing a bigger role in compensation than ever before. We are
proud to launch our first study and feel it will provide companies
with the latest industry trends and insights to help them stay
competitive, make informed decisions, and set up their equity plan
for long term success.”
Among the report’s key findings:
Equity Stock Plan Administration is Going Digital
The report shows that with the growing importance of equity in
compensation at private companies, more are going digital to help
manage and streamline the administration of their employee equity
stock plans and compensation. 77% of companies report that they are
currently using digital stock plan certificates, while 80% have or
are interested in integrating an online employee equity portal for
equity management. However, many are still in the transformation
process with only 42% of organizations citing that they have fully
made the transition to electronic stock certificates. The use of
digital can also potentially help companies save themselves from
significant future challenges as they evolve and enable their plans
to scale when they add more employees and shareholders to their
plans.
Equity Compensation is Becoming More Important to Attract and
Retain Employees
Equity compensation continues to be an important part of the
compensation package for employee recruitment and retention, with
36% of executives citing that the primary reason for equity
compensation plans was to attract and retain talent. Furthermore,
in the technology industry, equity-based compensation packages are
increasingly standard. Of the equity professionals surveyed, 78%
said that they believe the role of equity as part of their overall
compensation strategy will grow over the next five years.
Equity Plan Administration Challenges and Evolution
The report further shows equity plan administrators are working
closer with Human Resources to create plans that benefit both the
employer and employees. However, challenges associated with equity
plan management remain consistent. Equity plan administrators cite
strategic concerns such as understanding tax consequences (32%) and
setting up a new plan (29%) are the most difficult parts of the
job. Additionally, the report found equity administration is
evolving from a purely administrative role to a more strategic
role. When asked if equity plan management was their main function
within their companies 36% of respondents cite equity plan
management was only one part of their role.
Shareworks by Morgan Stanley presented the results of the 2020
State of the Equity Plan Management at Private Companies Report in
a virtual event on October 21, 2020. To get a copy of the report,
including full results and for more information about Shareworks by
Morgan Stanley, please visit www.Shareworks.com.
Morgan Stanley acquired Solium Capital Inc. in May, 2019 and the
company was subsequently rebranded Shareworks by Morgan Stanley.
Shareworks is a leading equity plan management platform that
provides software and administration services to more than 3,900
corporate clients, with 2.7 million participants in more than 150
countries, transacting in over 50 currencies.
Shareworks is a part of the Morgan Stanley at Work suite of
financial solutions which also includes Retirement and Financial
Wellness. Morgan Stanley at Work combines cutting-edge planning and
risk management software, Morgan Stanley intellectual capital and
financial education delivered through multiple channels to enable
employees to build a holistic plan to achieve their financial
goals. Shareworks currently has offices in the U.S., Canada,
Europe, and Asia-Pacific.
About Morgan Stanley Wealth Management
Morgan Stanley Wealth Management, a global leader, provides
access to a wide range of products and services to individuals,
businesses and institutions, including brokerage and investment
advisory services, financial and wealth planning, cash management
and lending products and services, annuities and insurance,
retirement and trust services.
About Morgan Stanley
Morgan Stanley (NYSE: MS) is a leading global financial services
firm providing investment banking, securities, wealth management
and investment management services. With offices in more than 41
countries, the Firm's employees serve clients worldwide including
corporations, governments, institutions and individuals. For more
information about Morgan Stanley, please visit
www.morganstanley.com.
Methodology: 2020 State of the Equity Plan Management Private
Markets Report
The findings in this report are based on propriety, third-party
research and survey data conducted by Rebel & Co. 391 senior
corporate decision-makers—including CEOs/Founders or equivalent,
Chief Human Resources Officers, Chief Financial Officers,
Designated Equity Plan Administrators and Certified Equity
Professionals—employed at private companies across various
industries globally participated in market and client surveys, as
well as one-on-one interviews. Company sizes ranged from under 100
to over 1,000 in worldwide employee headcount. Respondents were
interviewed using an online panel survey, with video interviews
conducted in August 2020. The range of issues covered included
attitudes and perspectives relating to equity and plan
administration, as well as priorities/challenges, types of plans
currently offered, and employee engagement.
© 2020 Morgan Stanley Smith Barney LLC. Member SIPC
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version on businesswire.com: https://www.businesswire.com/news/home/20201027005684/en/
Media Relations: Katrina Clay,
Katrina.Clay@morganstanley.com
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