Hi GV,
Sorry if my post came across too strongly written and loud.
RE: "First of all, Amy, please note that I have never, ever proposed killing off options. I have proposed expensing them within GAAP, though."
But do you truly think the two aren't related?
It appears to be rather common knowledge in Silicon Valley that they are related. In fact, people that sit on many boards here in the Valley, have already figured out the necessary reduction in the use of option tool should they get expensed, as if it's commonly accepted knowledge. The reduction amount companies are considering should these things go through appears to be rather common knowledge in the Valley.
I think you could be stating an opinion that misses input from high-tech companies. You may think the two aren't related, but the reality is that companies see the two as related. (Which is independent of who is right.)
RE: "Secondly, your positives of option issuance and negatives of stock grants are all within the world of startups. My problem with options is with public companies. If a company has gone public already, the negatives that you cite for stock grants just don't exist."
Would it be possible to please reread my post (maybe the second post is clearer) regarding the motivational aspects of options, but the bottom line is: it does impact public companies.
One scenario: if a public company is heavy on options but light on base, they save money, esp important during hard times, yet reward for performance when it is most cost effective to do so. If they are charged for this, they may start turning their comp plans into a plan that's more appropriate for the slower growing dividend-based companies, the lower growth style comp plans, as well as change the overall comp structure (of how many & who gets options.)
You can smell a comp plan a mile away, just by feeling people's motivational levels.
When I drive by Cisco, they're working until 8PM at night. Why ruin a good formula that motivates?
Regards,
Amy J |
