PARIS Publicis Groupe is creating a new employee stock ownership to incentivize staff during these tough industry times.
In the first step of a broader employee stock ownership program, Publicis is allocating 50 free company shares, in the first half of this year, to each of the 4,500 employees in France working in units in which the holding company owns more than 50 percent.
The granting of the shares will not be performance related but will be offered to those with the company for at least three months and will be subject to a two-year holding from the date of distribution. The current awarding of shares will therefore be delivered in the first half of 2011 and employees must then hold them for at least two years, in keeping with French law.
The program will be implemented elsewhere in the coming two years, to take into account diverse legal and tax systems around the world, and will gradually benefit all Publicis employees in countries where the company has significant operations.
“The management board and supervisory board want to send a strong signal to all Groupe employees by offering them free shares at a time when the crisis is a challenge to all of us. The first stage of this program will be in France, but it will gradually be implemented worldwide,” said company CEO Maurice Levy (shown above at right). “For key executives, this is a give-and-take arrangement whereby in exchange for their personal investment, they will be entitled to benefit from the Groupe’s success, provided they remain with the Groupe, and the Groupe meets the performance criteria. By extending the scheme to the largest number and in setting up the co-investment and incentive program, the Groupe intends to reward all the employees behind its success.”
In a second initiative aimed at senior executives, Publicis Groupe is creating a co-investment program, which has been offered to around 160 key personnel, based on personal investment in shares bought on the market. It includes retention and Groupe performance incentives and is subject to certain conditions. These executive investors will receive free shares rewarding loyalty after three or four years, according to local rules. In addition, they may receive performance-related free shares based on Publicis Groupe’s organic growth and operating margin by comparison with its peers.