Stock Options Are Not Incentivizing

Management decided to give everyone stock options as an incentive to work for the company’s success, and you get some! Great, yes? No?

You work for a global company with multi-million dollar revenue and hundreds of employees. Your part of the machinery is tiny. Maybe you’re configuring databases, or compiling sustainability reports, or working out insurances for the company and employees.

Regardless your role is only a fraction of what the company does and not even directly related to your core product; the thing that brings in the money.

Also management decided to go another round to get venture capital but got less than predicted. Maybe they set unreasonable targets for the quarter and now the stock falls because they weren’t met. Or management has set a strategy that will see the company in the red for the next five years before it hopefully starts paying off big time.

A competitor disrupted the market and sales are now in free fall. Your marketing strategy didn’t pay off at all. Establishing the business in new markets ran into local legal issues or political pressure. A reporter found that your biggest supplier uses child labour. Your biggest partner goes bankrupt.

A global financial crisis sees the stock tumble to dismal levels. Economic sanctions cause disruptions in your markets. A freight ship gets stuck in a canal and grinds your deliveries to a standstill for a month.

I bet you’re happy that your daily efforts help lead the company to success which will see you rewarded for your hard work! Remember that these stock options are better than a higher salary, because you - yes you! - have the power to raise their value to exciting levels!

-- CC0 Björn Wärmedal