Long-term incentive programs
The formation of a long-term incentive (LTI) program requires a thorough understanding of the optimal tools and tactics, awareness of the strategic goals of the company, and construction of a system that will fairly reward and motivate top managers and minimize risks for shareholders.
Working on the implementation of a long-term motivation element, we comprehensively review and balance the remuneration system, study Russian and international best practices, and select the approaches that will be the most effective for the client's situation and objectives.
The main tasks of developing long-term incentive programs include:
- synchronization of shareholder and top management agendas;
- ensuring the sustainable long-term development of the company;
- retaining talented managers in the company and ensuring stability;
- creating a transparent and understandable motivation system for top management to key stakeholders.
Our projects for the development and implementation of long-term incentive programs include the following stages:
1. Analysis of the company's strategic direction. At the beginning of the project, we carry out diagnostics of the current situation, and get acquainted with documents and the key stakeholders. When strategic goals are not fixed as a single document (which happens in practice), we record them based on the results of interviews and discussions with the shareholders.
2. Comparative analysis and scenario development. In our projects, we focus on both academic knowledge and the application of the best international and Russian practices of market leaders. A wide network of our own contacts, updated knowledge base, and data on financial statements of companies allow us to obtain reliable data on the structure of LTI programs of reference group companies. We analyze the obtained information and develop several recommended scenarios for the client.
3. Modeling and preparation of recommendations. For every scenario, we create models for calculating the economic component of the proposed long-term incentive programs and develop appropriate recommendations.
4. Selection of the optimal solution and development of documentation. The final stage of the project involves the client's choice of the optimal solution and the development of relevant documents and regulations. If required, Ward Howell can facilitate meetings and discussions, participate as an expert or engage additional expertise, and draft the necessary documents.
Ward Howell expertise
- Our high standards of internal processes, daily contact with company executives, business owners, and Board members, as well as an updated knowledge base guarantee fast data retrieval, accuracy, and depth.
- Our team comprises industrial and functional experts, giving us a deep understanding of the context and challenges of both the industry in general and the individual client.
- Ward Howell conducts its own leadership research and participates in global projects with INSEAD Business School. We have authored several business books and numerous scientific publications. We rely on both practical experience and accumulated academic knowledge to implement our projects.
- We strive to ensure that our company, projects, and practices have a positive impact on the future and create long-term results for both our clients and Ward Howell.