HCL Tech to include Restricted Stock Units in compensation mix to retain high performers

Noida-based IT services firm HCL Technologies announced that its existing long-term incentive (LTI) programme will include Restricted Stock Unit (RSU) grants as part of the compensation mix, as it looks to retain high performers amid war for talent.

Under this model, which was approved by the Board on October 14, the company will move from 100 percent cash awards to a mix of 70 percent cash and 30 percent RSUs for the grants, which will be offered in the later year subject to shareholder approval.

The plan proposes to allocate 11.1 million shares (equal to less than 0.5 percent of the company’s equity shares) to almost 3,000 senior leaders, the company said in a statement. Earlier, 1,000 senior executives were covered under the plan.

The plans will be offered as tenure-based vesting by FY25, and the company also has proposed an option to substitute this part of the plan with RSUs that vest based on achievement of long-term performance targets, the statement added. The structure of the programme will ensure there is no equity dilution for existing shareholders of the company. The total plan investment will not be impacted by the move from all cash to cash plus RSUs.