EMI was introduced in 2000 to encourage employees to own shares
in their employing company or, if a group of companies, in the
parent company. It is commonly used as a means of rewarding,
incentivising or retaining employees or for a combination of these
objectives.
The options can be awarded with certain conditions which must be
achieved before the option vests and the employee is entitled to
exercise the option. These objectives can be aligned to the
business objectives and can set goals specific to each employee,
ensuring the employee focuses on the key business drivers.
The company has to satisfy qualifying conditions including
regarding the nature of its trade. There are also size criteria
that need to be satisfied, the gross assets cannot exceed
£30m and the full-time equivalent number of employees cannot
exceed 250.
