ISE welcomes KEEP share option measures in Finance Bill

  • Minister deserves credit for supporting high-growth Irish companies – ISE CEO 
  • Measures will apply to all Irish companies listed on the ISE’s Enterprise Securities Market

ISE welcomes KEEP measures which support high-growth Irish companies

The Irish Stock Exchange welcomes measures in the Finance Bill that will support high-growth Irish companies, including those on the ISE’s Enterprise Securities Market (ESM), by facilitating new incentives for employee share ownership.

The Key Employee Engagement Programme (KEEP) announced by the Minister for Finance, Paschal Donohoe TD will make it easier for Irish companies to grow to scale by increasing their ability to attract and retain skilled staff. KEEP will also enable companies to align employees with the company’s vision.

"Share ownership schemes deliver better motivation for employees" - Deirdre Somers, ISE CEO

ISE Chief Executive Deirdre Somers said: “The Minister deserves great credit for introducing these measures. Attracting and retaining high-calibre people is a huge challenge for all growing companies and these measures will give them a crucial tool to incentivise staff and enable them to reach their full potential.

"Research shows that companies with employee share ownership schemes deliver better motivation for employees, have increased productivity and profitability, and deliver higher growth and better jobs in the economy.

Companies listed on the ISE's Enterprise Securities Market eligible for KEEP

"We particularly welcome the Minister’s inclusion of companies listed on the ISE’s Enterprise Securities Market (ESM) as eligible for this programme. This is a very significant boost for companies listed on the ESM and the pipeline of companies that are planning to list on it.”

The ISE had campaigned for the introduction of a new share option scheme aimed at growth companies for a number of years.  

Measures remove existing double taxation of share options

The measures announced today will remove the existing double taxation of share options - income tax, Universal Social Charge and PRSI on the exercise of options with an additional Capital Gains Tax on the sale of shares.

They will also ease the existing cashflow constraint that makes employees who exercise share options liable for tax on a paper gain, which has made share options significantly less attractive by incentivising employees to sell some of their shareholding immediately to meet an upfront tax liability.