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Employee equity plans playing a growing role in the way companies reward their staff in Asia

Employee equity plans playing a growing role in the way companies reward their staff in Asia

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Over 80% of companies, among those surveyed, in Asia have a share plan. 

Asia-based companies, more specifically those surveyed in Mainland China, Hong Kong, Taiwan and Singapore, are increasing both the amount of capital they award employees and the proportion of their staff that receive shares. This is per a survey of employee share plans by Computershare, that surveyed more than 1,000 employee share plan (ESP) participants from the markets listed above on two types of share awards - restricted stock units, and share options.

The study, titled 'Quantifying the Impact of Employee Share Plans in Asia', and prepared by the University of Hong Kong and carried out by the University of Warwick, found that over 80% of companies, among those surveyed, in Asia have a share plan. 

On the employee's side, 47% of employees surveyed, said share awards represent one of the largest investments, if not the largest, they hold, while another sizeable chunk (40%), said ESPs are a moderate part of their investments. For 12% of those surveyed, ESPs represented one of their smallest investments.

When tallied to employee sentiments, the data showed that the proportion of employer stock held by employees in Asia (as a percentage of the employee’s total wealth), could be a reliable predictor of employee attitudes and behaviours. The attitudes and behaviours were studied across six indicators, three of which are summarised below:

Psychological ownership broadly reflects the extent to which employees think of the organisation as ‘their own’, including the feeling that the goals and objectives of the organisation are theirs. When asked if respondents "feel a very high degree of personal ownership for this organisation", 45% strongly agreed, while 24% chose to remain neutral or disagreed.

Organisational identification indicates the degree to which employees define themselves as a member of the organisation and to what extent they experience a sense of unity with its values. When asked if respondents "feel this organisation’s success is my success", about 60% either agreed or strongly agreed, while 26% chose to remain neutral or disagreed.

Turnover intention is the psychological measure of the likelihood that an individual will leave the organisation and is an predictor of actual turnover behaviour. When asked if respondents "often thinking about their job at their company", about 82% either disagreed or strongly disagreed, while about 16% chose to remain neutral or agreed with the thoughts of quitting.

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