NASPP/Deloitte 2010 Stock Plan Survey
NCEO founder and senior staff member
The 2010 National Association of Stock Plan Professionals/Deloitte Consulting "Trends and Analysis from the 2010 Domestic Stock Plan Design Survey" shows some decline in broad-based stock plans but demonstrates that these plans are still alive and well, with at least 25% of non-exempt employees eligible for some kind of award. The survey drew responses from 597 companies, most of which are members of the National Association for Stock Plan Professionals (NASPP). The companies sampled tend to be very large, and almost all are both public and based in the U.S. Two-thirds of the respondents have 1,500 or more employees; just 9% have under 250. Twenty-one percent of the respondents are in some kind of high-technology business.
The survey found that 74% of the companies had overhang rates of 15% or less over the last three years, and 45% had overhang rates of 10% or less. Sixty-nine percent of respondents had run rates of 2.5% or less over the same period.
The survey asked respondents what kinds of plans they offered, who was eligible for various kinds of awards and, of these, how many actually received awards. The tables below extrapolate from the these three numbers to indicate what percentage of the total sample of companies make non-exempt employees eligible for awards and what percentage of those eligible in this category actually currently receive them (note that this is for the whole sample, not just the percentage in companies offering that kind of award). It is not possible from the tables to know in how many cases employees may be eligible for multiple kinds of awards. So while the total percentage of employees receiving any kind of award is larger than the percentage receiving any specific award, that percentage is also less than the total percentages for each kind of award added together.
Eligibility and Receipt of Stock Plan Awards, 2010, Non-Exempt Employees
| Type of Award | % of Companies Offering | % Non-Exempt Eligible, All Companies* | % Non-Exempt Receiving, All Companies** |
|---|---|---|---|
| Incentive Stock Options | 92% | 12.0% | 7.8% |
| Non-Qualified Options | 92% | 23.0% | 18.6% |
| Stock Appreciation Rights*** | 15% | 2.6% | 1.3% |
| Restricted Stock | 58% | 7.0% | 4.9% |
| Restricted Stock Units | 73% | 11.7% | 9.9% |
*This number is derived by multiplying the percentage of companies offering the plan by the percentage of non-exempt employees eligible for that kind of award.
**This number is derived by multiplying the percentage of companies offering the plan by the percentage of non-exempt employees actually receiving that kind of award.
***The stock appreciation rights category in the survey has three different groups depending on how the award is settled; this number blends the three into an approximate total.
Very conservatively, it appears that at least 25% of the companies make non-exempt employees eligible for some kind of award, and 20% of the companies actually provide grants of some kind of equity award to non-exempt employees. The real number is probably higher. While this survey sample is biased toward companies that already have some kind of stock plan, and probably somewhat biased toward companies with broad-based plans (companies with grants just for one or a very few employees would see less need to join a stock plan organization such as NASPP and thus would be unlikely to participate in this survey), the results do suggest that broad-based equity awards remain an important part of the compensation practices of public companies.