Share Scheme Success for Sports Direct
There are huge benefits to be had by implementing a share scheme. Employee engagement is said to be the key to a happy and motivated workforce and what better way to get employees engaged than by making them a part of the company through ownership. The case of Sports Direct highlights just how incentivising employees with a share scheme can help to boost sales and maximise profits for all.
The leading sportswear retailer has given the largest payout in shares to date, £88m! Chief executive of Sports Direct, David Forsey, attributed much of the group's recent success to the employee profit share scheme, saying The bonus share scheme has been a massive influence over the performance of the group... It has acted as a glue to pull everyone together.
Their share scheme was implemented two years ago to help improve trading performance and it is clear the scheme has in fact achieved this target. The Sports Direct share scheme is now more generous than longstanding share schemes in operation at John Lewis, Tesco and Asda. Also in place is a HMRC approved executive bonus share scheme, which was set up in September 2010. Awards under the executive bonus plan are to be subject to performance conditions. The extent to which the awards will vest is based on whether these performance conditions are met.
The case of Sports Direct shows the wide ranging benefits that share schemes have to offer and demonstrate their ability to incentivise and encourage employees to achieve performance conditions set.
If you would like to replicate the schemes implemented at Sports Direct (and hopefully the success!) consider an all employee share scheme like the Share Incentive Plan (SIP) and an Enterprise Management Incentive (EMI) scheme for your key individuals.
If you are considering implementing a share scheme to help benefit your business, and would like to discuss your requirements, then please call us on 020 8949 5522.