Colin Kendon
Colin Kendon is head of employee incentives and benefits at Bird & Bird.
In what ways does employee share ownership serve a useful purpose?
At its most effective employee share ownership gives employees an interest in the financial performance of their employer, it makes them think like owners and it improves productivity.
How can we widen and deepen the adoption and use of employee share ownership?
By introducing all-employee plans that do not require low-paid employees to fork out cash until they are in a position to fund it through share sales. For example: CSOPs operated on an all-employee basis.
What is the greatest obstacle to wider and deeper employee share ownership?
Cash flow. The two so called "all-employee" share plans are not in practice taken-up by all employees – only those that can afford to save. We don't require executives to fork out cash to access equity so why require it of employees who can't afford it?
You spoke at the recent Centre / IoD conference on shares for rights, do you think it’s made a positive contribution to employee share ownership?
Shares for rights has made a huge contribution and will continue to do so for years to come. It allows unlisted companies to attract talent from safer jobs by offering attractive equity incentives and that has to be good for productivity. Wouldn't it be great to have a study into the productivity gains for a change instead of having to listen to complaints about the (probably lower) tax costs?
What has been the most important development in employee share ownership during your career?
What is now Part 7 ITEPA 2003 – it changed most of the landscape almost overnight.
Which change to employee share plans legislation, in the UK or elsewhere, would you most like to see?
Ability for companies to buy-back their own shares pursuant to employee share plans without distribution treatment applying.
Is there a particular employee share plan you have been glad to work on? If so, why?
Playfish Limited - EMI plan. Option gains were $100 million, the tax savings represented around 25% of the cost of EMI plans to the Exchequer for the year they exited. The team took a big risk, paid themselves low salaries for 2.5 years and it paid off.
Why do you think employee share ownership has enjoyed cross-party support in the UK?
The main parties accept it is better for employees to have a stake in the companies they work for. I hope they also continue to accept it is better to encourage people to take a risk by becoming entrepreneurs' and choosing to locate in the UK.
Which living person would you most like to meet?
David Cameron.
Which book has most changed your life?
Growing Vegetables (Royal Horticultural Society's Encyclopaedia of Practical Gardening) by Tony Biggs. Fantastic read – I won't spoil it by giving away the plot.
What do you consider your greatest achievement?
Becoming a partner at Bird & Bird – had to build up the practice following the 2008 crash to get there.
What would you have done if you hadn’t become a lawyer?
I suppose I would have run the family farm.
How do you relax?
When not acting as a chauffeur for my kids and / or watching them play sport - looking after my allotment.
