Performance Options: Introduction to the Design, Valuation, and Accounting Considerations

Despite the growth in performance-based restricted stock units, many companies are longing for the clean incentive benefits of stock options, but are unable to grant them because proxy advisors don’t consider them to be “performance-based.”

Updated for 2019, this issue brief provides an introduction to performance options: the circumstances where they make sense, and the unique valuation and accounting challenges they present.

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