Information for Executive Management
Applied Economics generally recommends that companies sponsor a Management Incentive Plan (“MIP”) for the benefit of key members of management. The purpose of a MIP is to reward, incentivize, attract, and retain the critical talent needed to lead the business. Most often, a MIP takes the form of Stock Appreciation Rights (“SARs”). The value of SARs is dependent on the Company’s growth in equity value.
The power of the ESOPs tax advantages, coupled with a strong performing company, can create meaningful retirement benefits for employees. The table below is an illustrative example of the wealth that is created for employees.
Management Team Benefits
The Management Team benefits in multiple ways with the ESOP