What makes a great lawyer? The answer is obvious: years of experience. That answer could be true for any number of professions. All great experience starts with a brilliant education. Jeremy Goldstein got his education from New York University School of Law, University of Chicago, and Cornell University.
After passing the Bar, Jeremy Goldstein started working at Wachtell, Lipton, Rosen, and Katz. When he left that firm, he started his own boutique law firm. Since then, he accumulated over 15 years of business law experience with a focus on executive compensation and corporate governance. Now, he’s many companies’ go-to business attorney when it comes to employee benefits advice.
Lately, a lot of companies have been asking him about stock options. Most of them decided to do away with stock options in favor of less confusing benefits. Overall, the companies seem happy with their decision, but Goldstein suggests that they take another look at stock options.
There are lots of reasons that these companies could be moving on from stock options; most of which involve money and ease of access. Mostly, employees don’t believe in stock options like they used to. These days, the market is a hectic place to put their future. They don’t want to risk everything being gone in the blink of an eye.
According to Jeremy Goldstein, the advantages of stock options far outweigh any risks. For a start, it’s easier for employees to see a resemblance to equality. Paying out additional wages, equities, or providing better insurance coverage can get tricky when it comes to fairness.
The obvious advantage is that stock options make people personally responsible for the company’s success. When people’s futures depend on the success of the company, they’ll work harder to satisfy existing customers and find more in the future. It also brings more ingenuity and innovation to the company.
When it comes to offering stocks, the question then becomes which one to offer. Some options are too dangerous for employee benefits, but some are better than none. Goldstein suggests looking into “knockout” stock options. It’s one of the safest options to go with.
Knockout options are the same as conventional options, except they become useless if the share value falls below a certain amount. That means employees aren’t on the hook if anything goes too wrong. If things get better, the options become available again. Learn more: http://files.ali-aba.org/pdf/Goldstein%20new%20BIO.pdf