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Almost two thirds of companies preparing for flotation do not offer share options to employees in advance of the event, claims a report by Andersen.
The report, called Directors Remuneration on Flotation, claims that only 40 per cent of companies offered share options before becoming a plc.
Instead most companies offer share options at the moment of flotation, meaning that the shares are not always as valuable.
An analysis of 600 companies floating over the last four years shows that only half of them have shares valued higher than when the shares first went on the stock market.
Andersen human capital partner Bill Cohen said, “Potential investors will expect good practice in the area of governance, particularly where one or more executive directors are founder members of the company with large shareholdings.”
