This is a leading listed Indian pharma company with a track record of more than 6 decades and market in more than 150 countries, worldwide. The family controlled business decided to hire a pharma professional of high repute from a multinational company for the CEO position. The company expected him to be leading the company through organic growth and fortifying overseas presence through strong alliances and also acquisitions.

Challenges

The challenge was to create an attractive proposal that would be seen by the prospective CEO as an opportunity for long term wealth creation. However, the company also looked to balance wealth creation with equity dilution. The company needed to to bring market parity to overall compensation for the CEO.

Solutions

A scheme of discounted ESOPs was built around the objective of creating an attractive wealth creation opportunity. Units under this Plan were given at discounts with a staggered vesting schedule within a vesting period of 5 years. The scheme was rolled out while ensuring compliances under applicable laws and optimized for accounting costs. ESOP Direct also offered support in through the software platform My ESOPs.

Value delivered

With the discounted scheme we were able to bring down funds outflow from employees at the time of exercise. We also lowered dilution to shareholders. This stood in favor of the company and indeed proved to be a win-win situation.