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.”
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