Despite slow downs in world economies and increased share price volatility, the global trend to increasing ownership of shares by individuals shows no sign of abating.

Employee Share Plans (ESP’s) are an extremely efficient mechanism to enhance that process, as all employees can be offered the opportunity to ‘earn’ an ownership share of the business they work in. The growth in shares as part of household assets can be compared to the dramatic increase in widespread ownership of cars and houses over the last 100 years. However we are at the beginning of the share ownership cycle, and CPM is positioned right at its core.

Overview
We are the largest ESP manager in the world,with over three million employees and 600 corporate clients. Our market share represents just over 30% in the UK, 50% in Australia and 20%in the US.

Computershare Plan Managers was formed in 2001 and combines the existing share plan business run within Computershare Investor Services with the newly acquired Employee Plan businesses in the US and UK. We are also currently introducing CPM into the South African market.

By bringing these separate businesses together under a global structure we have harnessed the relative strengths of our systems, together with our specialist staff, to create a unique, globally coordinated, total plan management service. Our staff in each location are members of professional industry groups, and are actively involved in promoting the interests of widespread employee share ownership.In addition, we have provided valuable information to the Australian Federal Government as it forms new policy in the ESP area.

Since the formation of Plan Managers we have been successful in winning significant new business in competitive tenders from multinational companies who understand the benefits that accrue through our global model and our end-to-end service offering.

Over the coming months we believe there will be significant growth in this under serviced market. Existing plans are poorly serviced or coordinated badly through a range of different channels, and that leads major companies, increasingly, to look to outsourcing the management of their plans. Many other companies also find outsourcing preferable in the absence of in-house resources.

Tax concessions in the US since 1972 have seen the number of employees participating in ESP’s grow from 250,000 to over eight million today. New concessions in the UK last year will see 900 London Stock Exchange listed companies reconstruct plans for over one million employees, enabling them to acquire up to $A20,000 pa worth of shares, tax free. The UK Government is expecting 1,750 companies to take advantage of the new concessions.These concessions are conditional on plans being offered to all employees. Australia also requires broad based offerings to qualify for tax concessions, and both major political parties are keen to enhance current concessions to a more internationally competitive level.

All major locations are seeing more shares being offered to employees rather than options, as they create more durable employee shareholder interest and motivation. These trends and fiscal initiatives will see a dramatic lift in both numbers of individuals and shares under management in ESP’s.

New share owning democracies in Eastern Europe will also create significant new opportunities.

We expect to secure an increasing number of major corporates around the world, as we promote our global, full service capability, building on the early success in attracting major international companies.

Efforts will also be focused on delivery of this enhanced service to existing corporate clients, with appropriately enhanced fee structures, as well as marketing to new prospective clients who may be seeking a better solution. Our strong competitive edge and first mover advantage will provide opportunities to increase market share in all locations.

We are very excited about the future of CPM.

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