EUROPEANCHAPTER

Boku Inc. will hold an Extraordinary General Meeting (EGM) on 11 September 2024 to seek shareholder approval for a new executive share scheme. The New Plan, designed to reward exceptional performance and align executive incentives with company growth, will allocate up to 9,090,858 restricted share units, representing 3% of the company's issued share capital. Awards will vest based on a performance condition tied to share price growth over the next few years, with further details available in the Notice of EGM.

Section 409A of the Internal Revenue Code governs the taxation of stock options and other deferred compensation, requiring companies to follow strict compliance standards to avoid severe tax consequences. This regulation was introduced in response to corporate scandals like Enron, aiming to enhance transparency and fairness in deferred compensation practices. For startups, compliance with Section 409A involves obtaining a 409A valuation to determine the fair market value of their stock, ensuring that employee stock options are priced appropriately and avoiding potential tax penalties and legal issues.

Rolls-Royce announced it will give each of its employees £700 worth of shares after reporting £1.1 billion in profits for the first half of 2024, as a reward for their hard work. CEO Tufan Erginbilgiç emphasized the importance of employees sharing in the company's success, with the share distribution costing Rolls-Royce £30 million. Experts highlight that share schemes can boost employee retention and engagement, though their effectiveness depends on clear communication and thoughtful implementation by HR teams.

Rolls-Royce announced it will gift 150 shares, worth approximately £730, to each of its employees as a reward for their contribution to the company's success. This move comes as the company experiences a significant financial recovery, with operating profits rising and a resumption of dividend payments after a five-year hiatus. The company's CEO, Tufan Erginbilgiç, attributed this success to a rebound in international travel, a restructuring plan, and cost-efficiency measures.

Societe Generale successfully completed its 2024 Global Employee Share Ownership Programme, raising EUR 186,907,707.84 and issuing 9,055,606 new shares subscribed by approximately 46,000 current and retired employees across 35 countries. The bank's share capital now stands at EUR 1,015,044,435.00, comprising 812,035,548 shares, with a minimal impact on the CET 1 ratio of around 4 basis points, effective by the end of Q3 2024. The program, the 31st of its kind, is part of Societe Generale's long-term commitment to employee involvement and sustainable value creation.

Employee-share schemes are an effective tool for attracting talent, boosting productivity, and improving employee retention, with 81% of UK companies reporting positive impacts. However, they come with risks, particularly around tax complexities and misalignment with company goals, requiring careful design, implementation, and communication. Additionally, the broader challenges of inequality, such as gender disparities and the financial accessibility of these schemes, need to be addressed to maximize employee participation and impact.

From May 31, 2024, HMRC will no longer automatically issue cheques for PAYE tax repayments; instead, customers will need to actively request their repayments online or by cheque. PAYE Settlement Agreement (PSA) calculations for the 2023-2024 tax year must be submitted by October 19, 2024, if paying by post, or by October 22, 2024, if paying electronically, with payments made via a provided reference number. Additional updates include guidance on changes to P11D submissions, PSA compliance, and new reporting requirements for employment-related securities and basis period reform for self-employed individuals.