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5 Things You’ll Learn from the Equity Administration Survey

May 05, 2022

The Equity Administration Survey, cosponsored by the NASPP and Deloitte Tax LLP, is currently underway. The survey is a great opportunity for you to find out how your practices compare to your peers’. Here are five things you’ll learn by participating in the survey.

Employee Education

The pandemic has had an impact on many aspects of how we work, and I suspect one area where these changes will be apparent is in how companies educate stock plan participants. Online presentations were already on the rise in the 2020 edition of the survey, and I anticipate that this trend will only have grown.

The survey will report on how companies deliver participant presentations, if they’ve expanded or enhanced their use of online formats, and whether they plan to return to in-person presentations in the future.

Trading Windows

Insider trading compliance and the use of trading blackouts is a topic that we get a lot of questions about here at the NASPP. The survey is invaluable to us as we help our members assess how their policies stack up against what other companies do. One trend we’ve observed over the years is that smaller companies tend to make a larger population of their employees subject to trading windows.

I’m looking forward to refreshing our data on practices in this area. We collect data on which levels of employees are subject to blackout periods, who decides who is subject to trading restrictions, how long trades are prohibited for, what types of trades are allowed and prohibited during closed windows, preclearance policies, and more.

I also wonder if we’ll see any change in practices as a result of the shift to remote work.

Mobility Tracking

One thing the shift to remote work has for sure resulted in is an increase in employee mobility. With the current pressures on companies to recruit and retain employees, I don’t see this changing anytime soon. I don’t need a survey to figure this out.

But what I am interested to learn from the survey is how companies are managing compliance for their growing mobile employee populations, both domestically and globally. Are companies tracking more mobile employees, are they using employee location data in tax calculations, and who is responsible for these calculations?

Transaction Processes

We also get a lot of questions on the policies and procedures companies have in place governing stock plan transactions. Here are just a few of the questions the survey will answer:

  • How do companies allow employees to fund option and award transactions and any required tax withholding?
  • How do companies determine withholding rates for non-US employees?
  • Do companies allow employees to request additional tax withholding in the United States?
  • How do companies comply with US tax deposit requirements, particularly the $100,000-next-day-deposit requirement?

Country-Specific Practices

New this year, the survey will collect data on administrative practices in several countries. These questions were previously part of our global equity incentives survey but we’ve restructured all of the surveys to provide a holistic examination of worldwide equity programs.

Here are a few of the global practices I am excited to learn about:

  • Do companies transfer their NIC liability to UK award holders? If yes, do they grant additional awards to employees to compensate them for this?
  • Are companies still granting stock options in Canada despite the new rules limiting the preferential tax treatment for options that are effective as of July 2021?
  • Do companies comply with the EU age discrimination rules for retirees?
  • How do companies comply with securities laws and remit payroll tax withholding in Australia?
  • Are companies taking advantage of the preferential tax treatment offered in China under Circular 35?
  • How are companies managing SAFE registration and compliance in China?

Don’t Miss Your Chance to Participate!

If, like me, you are also interested in learning about your peers’ practices in any of these areas, make sure you participate in the survey. You have to participate to gain access to the full survey results. We won’t conduct this survey again until 2025; don’t miss your chance to participate this year.

Register to participate today!

  • Barbara Baksa
    By Barbara Baksa

    Executive Director