Esop Centre judges praised an impressive widespread group of winners, both old and new, in the 2020 edition of the Newspad Awards for the best employee share schemes of the year. A stand-out winner in this edition was the Daily Mail and General Trustfor its Share Purchase+ and Salary Substitution Plan, which topped the Best share plan adaption to the Covid crisis Award category for implementing its innovative Shares For Salary scheme in response to the pandemic, in order to preserve working capital and, ultimately, jobs.
The scheme began last April when employees with a salary of £40,000 or more were asked to take a pay cut of between one and 23 percent, depending on how much they earned, in return for receiving shares to the same value in the company. Ninety-nine percent of the 1,600 eligible employees agreed to take part in the share substitution scheme. At that time, the DMGT share price stood at 638p, but by January this year, when staff were able to cash in their shares, it had risen to 755p, an increase of 18 percent. Now the share price hovers around the 870p mark. Employees were covered either way, because the company had promised to fill the gap, had the share price fallen below the 638p start price by January.
Other companies took a similar route in early last year by installing Shares for Salary Substitution plans to conserve their cash reserves and to avoid redundancies during the pandemic crisis. Some ended these share substitution schemes before last autumn, thinking that the pandemic was almost over.
The awards were announced today (24 March 2021) at the Centre’s Share Plans Symposium On-line. All category winners and highly commended entries are listed below:
Best International All-Employee Share Plan
Winner: BAE Systems This award highlights the expansion of all BAE’s share schemes worldwide in 2020 and its long track record of commitment to broad-based employee share ownership which is consistently good. It provided an ongoing annual award with an evergreen ‘opt out’ switch. The opt-out choice clearly is ‘the way to go’ when it is a non-contributing scheme. It entered both its domestic and international SIPs. Nominated by Computershare.
Highly commended: BT for its BT-Your Share plan.
The judges felt that BT was ‘going the extra mile’, had achieved truly global parity and the commendation reflects its commitment to get 100 percent employee participation. Nominated by EQ.
Special commendation: Gamesys for its international SIP.
This entry impressed the judges as it was a first time adopter and had gone a long way quickly. Gamesys is evangelical about employee share ownership and included partners (non-employees) in its scheme, which chimed with the Centre’s thoughts on the future of Esops being for all workers whether classed as ‘employees’ or not.Nominated by Global Shares.
Special commendation: LPKF Laser & Electronics for the LPKF Employee Share plan.
Like Gamesys, LPKF impressed as a first time adopter which had successfully rolled out its share plan in a short time. The German company had overcome cultural and administration barriers to gain wide adoption of its scheme. Nominated by Global Shares.
Best Executive/Managerial Equity Reward Plan (more than 100 employees)
Winner – Imperial Brands for its LTIP.
The judges were impressed that Imperial widened the footprint of who was in the share plan and thought hard about how the plan influenced behaviour, rolling it out as a reward vehicle. It linked the on-going existence of the share award under the LTIP to compliance with employee ownership guidelines – linking the two employee ownership concepts.Nominated by Computershare.
Best Share Plan Communications
The judges praised an overall “excellent group of nominations”.
Winner – Marks & Spencer for its Sharesave 2020. Its communications made an impact, said the judges. Visuals were good and were tied in with branding and key info pings out. Nominated by EQ.
Highly commended – Sky for its Comcast Corp Omnibus Sharesave. The judges liked Sky’s focus on “Sharesave is back” with comms linked to its ESG initiatives. Nominated by Computershare.
Best Use Of Technology, AI Or Behavioural Science In Employee Share Plans
Winner – BT for its Your Share plan.
The judges felt that the Mifid data capture upfront to allow the downstream administration to run smoothly was smart, though BT’s main good use of technology was its impressive integrated weave of all its plans. It had used technology to make its share schemes simpler and behavioural science as well, by offering its free share plans to employees with an ‘opt-out’ rather than opt-in. Also impressive was its Workplace platform which made the process interactive and engaging for the employees. Nominated by EQ.
Best Share Plan Adaption To The Covid Crisis
Winner – Daily Mail and General Trust for its SharePurchase+ and Salary Substitution Plan. The judges were struck by DMGT’s response to the Covid crisis with a novel plan to award staff shares in exchange for a salary cut in order to save jobs and cash. The risk free plan was aimed at middle and senior management and 99 percent of those eligible joined the scheme (1600 out of 5700 employees). The judges felt it was a worthy winner as it was doing something new, specifically Covid-related. The main share plan objective was to preserve the company’s working capital resources. It aligned with employees’ interests and showed that awarding shares to employees can have a role in helping them to accept pay cuts. It was the most innovative response among the entries received. It had a positive business outcome too and even benefited employees who did not qualify, as it helped preserve their jobs and prevented furlough. A “real forward-looking move,” said the judges. Nominated by EQ.
Outstanding Company Leader (for Chairman or CEO personally associated with company plans)
Winner – Liv Garfield, Group CEO of Severn Trent: The judges felt that Liv Garfield was a worthy winner, as she had gone out of her way to personally promote share schemes to employees, especially younger female employees and to key employees, emphasising that she too was a plan participant.
Company Whose Employee Share Ownership Impacts Most On Company Success
Winner – Siemens Energy: Its Special Payment marked a major change in corporate ownership and the information which company included made its case compelling. The implied rationale was that the Special Payment supported the separate identity of the new de-merged entity. Nominated by Computershare.
The Awards judges were: Damian Carnell, executive remuneration expert and Esop Centre steering committee member; Deputy Gavin St Pier, member of the States of Guernsey and former Centre director; Ann Tyler, solicitor with more than 30 years’ experience of legal and policy advice in the employee share ownership and employee ownership sector. The chairman was Centre founder Malcolm Hurlston CBE.