Employee Benefit Trusts

Whilst employee incentive plans of varying forms have been utilised in the US, UK and other parts of the world for decades, they have not been widely acknowledged in Asia until recent years.  In particular, there has been an increase in businesses, from start-ups, most notably in the FinTech industry, to larger listed entities across a diverse range of industry sectors, in adopting some form of employee incentive plans, as a way to incentivise and retain high calibre employees, encourage loyalty and to attract top quality people to join businesses.

When the interests of employees and the shareholders of a company are aligned, employees tend to be more motivated, feel a greater sense of belonging and demonstrate loyalty and commitment to the company and its performance – a benefit to both employee and employer. There may also be benefits from a tax perspective, depending on the timing and schedule of vesting.  Generally speaking, business performance is enhanced when