Employee Education: 4 Easy Ways to Double Your Equity Plan Engagement

Equity compensation can be confusing and scary. As stock plan professionals, we eat, breathe, and sleep equity compensation, but I still triple-check myself when doing any planning, taxes, or valuation. We have to pull information from multiple software systems, think about dozens of policies, and consider hundreds of possible situations just to stay compliant. Time is our scarcest resource, so we’re always looking for easier ways to address our key challenges, like the Perceived Value Gap, low participation, and underwhelming employee engagement.

The Perceived Value Gap

Employees are not stock plan experts and have too much other work to do. Right now, whether an employee is 25 or 55 years old, whether they are making $22/hour or $250,000, they get the same one-size-fits-all equity compensation experience from most companies and providers. They also have to pull information from multiple software systems, think about dozens of policies, and consider hundreds of possible situations just to get the full value of their equity compensation. With all this complexity, employees consistently undervalue their equity compensation and create the Perceived Value Gap.

Employees undervaluing equity compensation and not engaging with plan benefits is why 96% of companies have “improving employee communications and education” as a top priority according to the 2024 NASPP Equity Incentives Design Survey. However, existing options are not working:

1. Fixed resources like PDFs or videos address basic questions but require manual updates. It is impossible to cover every potential situation, tax profile, and employee goal. Also, when it comes time to take action in a broker portal, people rarely remember to refer to or can find these company resources.
2. External advisors or internal presentations can address more nuanced situations but are expensive. Employees often learn during a session but feel lost again when something changes or they log in to a broker portal to see their equity. Once again, education separate from when an employee needs to take action leaves employees feeling unsupported at critical moments.

So, how can you build confidence and trust for your employees without spending too much time and money addressing individuals? Below, I’ll share the 4 Easy Ways to Double Your Equity Plan Engagement by modernizing employee education and giving each individual their own ideal participant experience.

The 4 Easy Ways

1: Consolidate Experiences

Meet Sofia. Sofia joined ACME Corp after getting a great offer with a 30-page pdf booklet about her benefits, including an ESPP. She attends a new hire orientation with a generic example of how ACME RSUs vest. “Do I get those?” she wonders. A month later, she gets a welcome email from ACME’s broker to set up an account. Along the way, Sofia also reads ACME’s internal groups discussing share price movements and chats with coworkers. Sofia’s head is spinning, and that is before she gets any tax documents!

Right now, Sofia doesn’t know where to turn when she has a question. When she logs into her brokerage to look at her holdings on a Saturday night, she has to find her post-tax investment account, pre-tax 401k, ESPP, and unvested stock awards all on different pages. When she hears ACME’s CEO talk about growth, she is excited about the potential but can’t remember the size or date of her next vesting event. Sofia wishes she could see what her ESPP would look like if the stock doubled but has nowhere to get that answer. Stress and confusion leave her undervaluing her equity compensation.

Asking employees to find a resource, do financial math, or remember information from a presentation makes equity compensation feel less valuable and hurts engagement. Differences between what employees expect, what they see in a portal, and what they see in their paychecks erode trust. Disconnected education experiences like pdfs, videos, or webinars force employees to (1) figure out what information applies to them (2) map company policies and tax regulations to their own situation and (3) navigate actions like exploring holdings, filing taxes, or trading stock in an isolated environment.

The Ideal Participant Experience bridges the gap between educational content and the ability to take action. Embed your educational materials in the same place participants can get information about their grants and holdings. Help employees learn about the full value of their equity compensation past, present, and future, all in a quick glance. Give Sofia one page and one place that answers all her questions to turn Sofia’s scavenger hunt into a cakewalk!

2: Leverage Interactive, Visual Learning

Meet Alex. Alex is very busy at ACME Corp. His manager, emails, and phone compete for his attention. He always gets interrupted when going through ACME’s ESPP resources. Eventually, Alex makes it through the materials and feels like he learned what “offering period” and “disqualifying disposition” mean.

3 months later during his ESPP enrollment period, Alex has to try to remember how ESPPs work. He remembers reading some documents, but it is all kind of fuzzy. He wishes there was a better way to learn than rewatching a video. Alex starts drawing some pictures to see how it might work. He can’t quickly figure out if participating is worth it and is running late for a meeting. So, he moves on and does not enroll.

Asking employees to imagine different scenarios hurts ESPP participation. Concrete, historical examples drive engagement. Talking vaguely about possible outcomes does not work. Clearly comparing futures where an employee does and does not participate helps build the confidence to enroll. Interactive, visual learning is far more effective than traditional, static learning methods. Visuals help mitigate fear of the unknown.

The Ideal Participant Experience uses clear visual scenarios that allow employees to interact with different possible futures and learn how equity compensation decisions can enhance their wellbeing. Have educational content that allows employees to (1) pace their own learning, (2) click around at every step to get more detail, and (3) play with options to visualize potential outcomes. Don’t make employees guess about the future. Create a place for Alex to touch and feel his equity compensation and learn the future is a game he can win!

3: Be Accessible Everywhere

Meet Leila. She attended a great session run by ACME Corp and their broker partner on RSUs, taxation, and equity compensation. In that session she learned a lot. Unfortunately, when she’s at home, she can’t access all the great educational resources on ACME’s intranet.

When she sat down at home, Leila couldn’t explain everything she learned to her spouse. Because the best educational content was limited to that in-person session and she couldn’t remember ACME’s 2nd intranet page, she couldn’t have a productive conversation with important people in her life.

Asking employees to engage with education on your terms makes it harder for them to access information when they need it. Restricting education to internal networks makes it difficult for employees to have conversations about equity compensation with important people in their lives. Plus, making education accessible everywhere reduces employee questions and frees up your time for more challenging questions.

The Ideal Participant Experience is accessible everywhere. Create educational experiences that are available on-demand and wherever an employee might need to access their information. Emails during moments that matter (like vests) should contain specific information for each employee instead of generic banners. Give Leila access to specific equity compensation education that is available on her terms and at any time!

4: Personalize and Automate Everything (AI!?)

Meet Sanya. Sanya just joined ACME Corp and does not get RSUs or Options. She is eligible for an ESPP. In the ACME intranet, though, she is bombarded with information about vesting and exercise prices. She finally finds ESPP information, reads it, and wants to participate. Now, she has to find another portal, fill out some forms to enroll, and do math to figure out how much of her paycheck to contribute. Sanya sifts through all the irrelevant information and eventually figures it out.

Looking back, Sanya isn’t sure she would’ve made it through that education gauntlet without her background in finance. Sanya just wants to get the exact information she needs exactly when she needs it. After Sanya decided to participate while reading the education materials, she wishes she could’ve enrolled instantly in that moment. Sanya wishes that ACME automated the complicated parts like calculating contributions, enrolling, and even managing her portfolio.

Asking employees to wade through information that is not relevant to them or only just “maybe” applies creates confusion that hurts plan engagement. General examples can be hard for employees to relate to; one-size-fits-all education alienates individuals. Each employee has a different background, situation, and goal. Each employee interacts with (or ignores) their equity compensation differently. Diverse workforces and volatile markets mean that no two situations are alike. 

The Ideal Participant Experience incorporates information about the individual’s exact circumstances and meets the participant where they are. In “Could a Robot Manage Your Equity Plan?”, Barbara Baksa talked about the exciting opportunity to have a portal that gives each employee the information they care about upfront: (1) how much equity they have, (2) how much equity they will have, and (3) how that equity has grown and might grow. Tailor communications, education experiences, and examples to each participant’s situations and allow them to interact with equity compensation on their own terms. Give Sanya her exact ideal participant experience at every moment, since no two ideal education journeys are the exact same!

But, wow, that sounds like a lot of time and effort

You don’t have to reinvent the wheel! Let technology instantly empower your employee education and 2x your plan engagement. All the information about each employee is already contained in your system of record. You know your firm’s policies and people like the back of your hand. Leveraging new technology, analytics, and automation can help you make all that equity compensation value transparent and accessible to all your employees, making them feel more valued and aligned with your company’s mission.

Equity compensation experiences have barely changed in recent years, but a faster pace of innovation and AI have created an opportunity for the rapid, cost-effective improvement of employee education and engagement. From employee emails that know what they’re thinking to customized education experiences that walk through an individual’s own equity compensation, there are tons of new ways to start closing the Perceived Value Gap.

If this sounds interesting to you or you’d like to learn more, please get in touch! We’re always happy to chat and collaborate.

Additional Resources:

Equity Expert Podcast: Employee Education
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Amit Gupta is the CEO of Salus. Salus instantly personalizes equity compensation experiences and education for each participant and administrator with high-ROI automation and AI. We reimagine equity compensation experiences with our partners to 2x equity plan engagement. Connect with Amiton LinkedIn or email him at amit@usesalus.com!