Employees earn 'Miles' to ensure they go distance
French insurance company AXA is giving away free equity shares to its employees in Asia as part of a global programme to build staff loyalty.
In January, about 2,100 AXA employees in Asia, including more than 600 in Hong Kong from subsidiary companies AXA China Region Insurance and AXA Asia Life, each received the equivalent of 50 shares of the global parent company, which is listed on the New York Stock Exchange as part of a programme called AXA Miles.
The aim of the mass share giveaway is to boost employee engagement and improve the company's customer focus. The programme will grant up to 0.7 per cent, or about 14million shares, of the number of the insurer's registered share capital.
It is part of a batch of initiatives rolled out by the company and forms the compensation aspect of an employee engagement drive launched early last year. The engagement drive will also focus on communications, the environment, community and career development.
The shares were first given away in France. Other countries included in the Asian launch are mainland China, India, Malaysia, Singapore, the Philippines, Indonesia and Thailand.
Katherine Yu, head of branding and marketing communications at AXA in Hong Kong, said that based on annual employee surveys conducted in other parts of the world, the share grant programme has helped improve employee engagement, job satisfaction and recognition and overall satisfaction.
She said the shares would be granted on top of any other shares or compensation-related benefits that the company's staff were entitled to.
'The initial and unofficial feedback we have received from staff in Hong Kong was good. Towards the end of the year we will have a new round of staff surveys and by that time we will have a better idea and statistical basis on how well this programme was received,' she said.
The programme works by awarding the company's employees with 50 AXA miles, which are then converted to the same number of shares of the parent company after four years, provided the employee still works for the company.
In Hong Kong, the shares will be backdated to last July, meaning that the AXA miles will be converted into shares in 2011. At that point, employees with such shares will be able to use their shares as they please, including divesting them.
Assuming that by then the shares will still be traded at the current stock price level of around Euro22 (HK$260), and the value of the euro remains the same compared to the US dollar, that amounts to equity valued at HK$12,950 for each employee.
The company is also planning on giving away another 50 AXA miles to employees next year, provided that this year it achieves an underlying earnings-per-share of Euro2.41, and a score of 82 in its internal customer satisfaction index.
For employees in Hong Kong, the second grant will convert to a comparable amount of the group's regional subsidiary listed on the Australian Stock Exchange.