Corporates and Family Businesses

Managing employee incentive arrangements

Managing employee incentive arrangements

The advantages of employee share ownership are widely known, but the benefits can be significantly impacted by the end user experience of the plan participants and pension plan members. At SG Kleinwort Hambros, we pride ourselves on putting the client and beneficiary experience at the forefront so that the investment in your employee incentive arrangements is fully valued by employees.

Our dedicated team administers a range of employee benefit trust arrangements for corporate clients.

Focusing on the beneficiary experience ensures investment in employee incentive arrangements is fully valued by staff.

Employee Benefit Trusts

Employee Benefit Trusts

Share warehouse arrangements for satisfying a company’s incentive schemes, particularly when targeted at senior management and key executives

Bespoke administration for key executive and discretionary plans

Provision of an internal market for private companies

International Sharesave plans

Joint Share Ownership plans

Assistance with Director post vest holding requirements

Deferred Share arrangements

Pension plan administration

Offshore pension plan trusteeship and administration

Provision of bespoke database

Online access for plan members

Access to inhouse investment managers and wealth planners

Open architecture solutions also offered


Our team of employee benefit specialists have the experience to guide you through the process of managing your employee incentive arrangements.  We are structured such that you will always have a person to talk to who can assist with all aspects of administration, strategy and planning, with a dedicated Client Director led team at your disposal.

SG Kleinwort Hambros has the unique feel of a boutique business with exceptional service delivered by our tightknit team of specialists, yet enjoys the support of the wider wealth planning and private banking business as part of the Societe Generale Group.

Preparing for an Initial Public Offering (IPO) - Employee Benefit Trusts for private companies

Prior to an exit, companies often look to ensure they retain and attract the best staff in order to achieve their desired levels of growth leading to a successful IPO.  A tried and tested way to secure commitment and align employees’ interests with those of the company’s shareholders is through an employee incentive scheme.

A Jersey Employee Benefit Trust (EBT) is one of the solutions of choice for pre- IPO structures to achieve this objective.

An Employee Benefit Trust can help align employees’ interests with those of the company’s shareholders prior to an IPO.

How does this work?

Before offering shares to the public, the company’s shareholders will transfer some shares (usually 5-10%) into an EBT. Flexibility is a key benefit of an EBT – the shares set aside can be utilized for any number of different schemes or plans that the company decides to put in place. The beneficiaries of the trust are the eligible employees, and a professional trustee is appointed who is required to act in the best interests of the employees.

The Trustee must take into consideration the recommendations of the settlor company regarding which employees participate in the plans.  The company usually grants the awards, sets the performance criteria which employees must satisfy and determines under what circumstances shares lapse or are forfeited. The Trustee will agree to satisfy the awards using the shares held in the trust.

The EBT allows the company to delay the transfer of full ownership rights for a given number of years in accordance with plan rules, or to tailor plans such that the awards are triggered on an exit event.

Employees are then committed for the duration of the IPO without having rights to income, capital or voting until the shares vest, in accordance with the vesting schedule of the awards.

Further advantages of an EBT

On an exit event or listing, the EBT can be incredibly useful when entering into documentation on behalf of the employees.  Instead of shares being held individually by employees, which can cause administrative complications, the trustee holds the shares on behalf of the employees on vesting. Entering into documentation on an exit event is therefore simplified as the company only needs to liaise with one entity (i.e. the trustee) in order for documentation to be executed efficiently.

EBTs are an immensely powerful tool in aligning the interests of executive management and shareholders.

EBTs are an immensely powerful tool in aligning the interests of executive management and shareholders.