Equity compensation can help organizations accomplish two goals at once: It not only incentivizes executives to drive long-term business performance but also contributes to a sense of ownership that can enhance employee retention, engagement, and wider company culture. However, the complexity inherent in equity plans can often mean that even experienced leaders may struggle to fully maximize their equity compensation without guidance and support.
Despite their financial sophistication, many executives lack a formal personal financial plan1—leaving them less confident and at risk of missing opportunities to better manage their equity awards or achieve personal financial goals. HR and benefits leaders are uniquely positioned to help close this planning gap by embedding tools, targeted guidance, and Financial Advisor access into equity compensation programs. This can help executives make more informed decisions, help boost financial confidence, and ultimately help support both individual and organizational goals.
The Planning Gap: A Hidden Risk in Executive Benefits
Equity compensation, which often includes stock options, restricted stock units, or other equity-based awards, is a powerful tool for aligning the interests of key talent with those of the company. Yet our recent research reveals a surprising disconnect: While executives are often seen as financially savvy, 44% of those participating in their company’s equity compensation plans say they do not have a formal personal financial plan.1
