Time to share: Cos move to stem attrition, attract talent



NEW DELHI: After the listed companies it’s now the turn of the small unlisted companies to roll out stock option programmes for their employees. A host of small start-ups are doling out stock options to their employees in order to retain them and also to make them partners in wealth creation. Companies like Calsoft, Hertz, Dr Lal Path Labs, Eclerx, and Evalueserve have done it and many more are expected to follow suit.

“The promoters want to share value. Most of them strongly endorse the concept of team effort,” Tarun Gulati, VP, ESOPDirect, said explaining the concept. According to experts, it’s in the maximum interest of promoters to give out stock options at an early stage, as it helps stop attrition due to poaching by the bigger companies.

It also helps the smaller companies in drawing talent from the bigger companies, who otherwise wouldn’t risk quitting cushy secure jobs. “We have given stock options to a core set of people who are key to the future of the company. Since we are looking at an IPO, we want to makes sure that they are with us right up to the IPO stage,” says Sharmila Natu, COO, Calsoft

Some companies like Hertz, a car rental company, are rolling out schemes that encompass all levels. “We are rolling out schemes for managers, executives and even an innovative scheme for drivers. As a company we believe in sharing and it helps if we have a highly motivated team with a long term commitment,” says Rajiv Vij, CEO, Hertz.

Though the drivers don’t have a proper stock option scheme, they can actually own the car that they drive after some years of service. One of the main drivers of this phenomenon have been the private equity players, who have invested in these companies.

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