Which of the following is not a reason for distributing equity among employees?
A) New companies often can't pay market rates for salary and wages
B) Including some equity in the compensation package aligns the employee with the company
C) The sense of ownership boosts morale
D) Distributing equity among employees reduces the risk of hostile takeover
E) Having some equity, the team sticks together during the rough times in the early launch phase

Question

Quizplus · Accepted Answer

Distributing equity among employees is primarily aimed at compensation, motivation, and alignment of interests rather than as a strategy to prevent hostile takeovers. Hostile takeovers are typically countered through other corporate strategies and shareholder rights plans, not through broad-based employee equity distribution.

Which of the Following Is Not a Reason for Distributing