A Unique benefit that can attract and retain talent
China’s economy is expected to grow in 2022 with the Bank of China predicting a five per cent increase for the year ahead. Coupled with ‘The Great Resignation’ phenomenon, it is having a significant impact on China’s job market. Companies across Greater China are working hard to attract and retain the talent they need to keep pace with the growing economy, resulting in a surge in recruitment activity.
However, accounts continue to emerge indicating that companies are struggling to secure candidates at the final stages of the recruitment process. Higher dropout rates are being recorded during sorting and selection due to applicants receiving offers from other organisations mid-way through the recruitment cycle. Companies are also beginning to realise that the power has shifted into the hands of candidates with workers in some industries spoilt for choice and as a result, becoming highly selective about which company they work for.
So how can HR ensure its company gains a competitive edge over its sector peers? An employee share scheme could be the key to attracting and retaining valuable employees.
Finding the competitive edge
Nowadays, the criteria that employees critique prospective employers against extends far beyond traditional compensation and benefit measures. As society and businesses begin to emerge from the pandemic, many employees are considering a broader range of factors such as company culture, flexible working options and opportunities for growth when making career decisions. As such, businesses are understanding the importance of articulating their Employee Value Proposition (EVP) in order to attract and retain talent.
It is widely reported that employees today are considering facts beyond pay when selecting a company to work for. An employee share plan is one approach that can assist companies to reinforce their EVP, helping companies to demonstrate the value they place on their employees and the role they see them playing in the success of the organisation. When companies have an employee share plan, they are inviting their employees to become shareholders, leading to a culture of employee ownership.
Computershare has been tracking the uptake in employee share plans across Hong Kong-listed companies for the past nine years and has found that over 80% of Hong Kong-listed companies now offer some form of an employee share plan. Traditionally used to reward executives, a share plan is a tangible way companies can show prospective employees the value they place on their staff, by enabling them to share in the company’s success. Employee share plans have evolved beyond executive level reward in recent years, as organisations begin to realise they can help companies retain talent and offer an advantage against competitors in the recruitment market.
A significant increase in the annual investment and allocation of wealth to employees through company share awards has also been uncovered as part of Computershare’s research. Since 2014, Hong Kong-listed companies have increased their annual share allocation by over 70% and there has also been a 90% increase in the number of employees receiving awards from their employers over the same period. The data shows that this kind of benefit is now being extended far beyond its traditional boardroom setting.
Make an Employee Share Plan work for your business
When deciding whether to launch an employee share plan, there are many aspects to consider such as plan type and structure, which will vary depending on employee base and organisational goals. For example, an executive plan is typically designed to drive performance and incentivise staff to reach goals and fulfil KPIs. Whereas a broad-based plan is typically designed to reward employees for their tenure with the organisation.
Whether you are new to the world of employee share plans and need help getting started, managing your plan in house and need more resources or simply wish to outsource, Computershare can help by offering bespoke solutions to help you deliver the right plan for your business.
Paul Arkwright
Publisher
