Jessica O'ConnorNew research suggests most senior executives believe their organisations are making effective use of Employee Benefit Trusts (EBTs), while many expect to rely more heavily on external support for administering employee incentive plans over the coming years.
The study, conducted by Ocorian, found that 90% of senior executives and employee reward leaders across UK private and publicly listed companies considered their EBT to be operating at its full potential.
Only one in 10 respondents said their EBT was not being used effectively.
The data also highlighted which functions employers most commonly utilise.
More than 93% said their company uses an EBT to hedge future share commitments, and 95% reported effective use of EBTs to manage administration and costs associated with major vesting events.
Over half (58%) already use their EBT for off-market purchases, while the remainder said they have considered doing so.
Despite confidence in overall EBT usage, employers reported a growing need for external expertise.
Almost 72% said they currently outsource their administration for employee incentive plans, while 26% manage this work in-house.
Looking ahead, 78% expected their use of external support to increase over the next two years, with a quarter predicting a “dramatic increase.”
Only 3% anticipated reduced outsourcing.
Respondents identified improved service for plan participants as the main reason for using external support, followed by cost efficiency, access to participant portals, and the complexity associated with large-scale plans.
Brendan Dowling, head of employee incentive services at Ocorian, said: “Our new research indicates that senior executives and HR leaders are clearly getting it right when it comes to maximising the potential that employee benefit trusts can bring, but are seeking extra professional support and advice when it comes to employee incentive plans.
“They understand the benefits that these programs can bring, but operating them in an efficient, resource-effective way can be challenging for in-house teams.
“At Ocorian, we have a dedicated team with a depth of knowledge and technical expertise that can ease the burden of administering employee incentive schemes.”
