The Importance of Educating Participants

Written By: Caitlin Conklin, Robyn Shutak

Keeping participants educated and engaged is vital to the success of any equity program. Failure to do so can lead to several negative outcomes ranging from low participation rates, to tax surprises and poor productivity. 

The latest statistics* all illustrate that even though participants value their equity plans, they need more education to really unlock their full benefits and potential.

Participants value their stock benefits…

  • 77% of equity program participants in 2021 value their company stock plan benefits.
  • 60% of equity program participants in 2021 stated that stock plan benefits were a reason for staying with their companies.
  • 71% of equity program participants in 2021 believed that stock plan benefits were a way for their companies to recognize their accomplishments.

But they need education to make the most of them…

  • Only 39% of equity program participants in 2021 understood how taxes impact their stock plan benefits.
  • Only 38% of equity program participants in 2021 understood how to maximize the financial benefit from their stock plans.
  • Only 46% of equity program participants in 2021 knew how to reach someone to ask questions about their stock plan.

*Source: Morgan Stanely’s VOICE OF THE PARTICIPANT – 2022

What’s the best way to educate them? Through key communication channels… 

What’s Most Prevalent? Email, intranet, and presentations.

However, companies are most interested in internal collaboration tools, videos, interactive games or quizzes.

*According to the 2022 NASPP / Fidelity Equity Compensation Outlook Survey on ESPP Policies

Are You Letting Your Employees Leave Money on The Table? 

The lack of a solid education and communication plan can often leave your employees confused or having a lack of understanding how their equity compensation works, how it’s taxed, or potentially missing out on opportunities to generate valuable wealth. Below are some considerations you can communicate to your employees when it comes to equity compensation:

  1. Encourage them to make a plan 
    Successful financial planning usually begins with a solid plan. Employees should be better prepared to analyze the role that equity compensation plays in helping them to reach their financial goals.
  2. Help them know the triggers 
    There are different stages in the equity lifecycle where employees need support to take action. Help them make informed decisions and take the right actions when their shares vest.
  3. Gain a better understanding of the tax implications 
    Employees need help understanding more complicated topics, like how different types of  equity are taxed. Employees should be informed about the potential tax obligations related to their equity compensation and offered tips for talking to an accountant or financial planner.

Need Help Educating & Communicating To Your Participants? 

At Infinite Equity, our team has extensive experience in educating program participants on how to maximize the benefits of their equity services, how to navigate tax implications, and more. Our services are personalized, tailored, and creative to ensure that your participants understand their plans. 

Contact us so you can not only maximize the effectiveness of your equity programs, but build greater trust with your employees and their families, and fuel a culture of ownership and innovation in your organization. 


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