poll - directors share plan, page-40

JP, exactly. The Directors benefit from the plan because of the loans being interest free, and from any capital gain that they may achieve on the shares issued under the plan.

If they don't perform, and the share price doesn't go up, they do not benefit from the plan at all.

Obviously it also makes sense to tie a proportion of a Director's remuneration to their Company's share price. In my view it's a win win if they conduct themselves in such a way as to realise large share price gains. The Directors benefit because of the plan and I also win.

I believe that this type of remuneration package is also more tax effective than the issuing of options.