The wealth that share plans should create

By Nigel Watson

4 Aug 2026 6 min read

Wealth is being discussed everywhere at the moment.

Gary Stevenson has taken the case for a UK wealth tax from YouTube to his recent Channel 4 documentary, How to Get Filthy Rich. The Labour government continues to face pressure to shift more of the tax burden from work towards assets and accumulated wealth, even though a comprehensive wealth tax is not currently government policy. In France, debate continues over the proposed “Zucman tax”, under which households worth more than €100 million would pay taxes amounting to at least 2% of their net wealth each year.

Others are pushing back. Economist Gerard Lyons argues that wealth taxes are not a simple answer to Britain’s fiscal pressures. Much of the wealth they reach may be tied up in businesses and other productive assets, while a liability detached from cash flow may force an owner to borrow or sell simply to pay it. He also argues that such taxes may discourage investment, change behaviour and raise less than their supporters expect.

The argument about how wealth should be taxed is important. But supporters and critics generally enter it at the same point: after the wealth has already been created. Should it be taxed, transferred, protected or left alone?

There is an earlier question which receives much less attention: who was given the opportunity to participate while it was being created?

Value creation is the safe language

This is particularly striking in the equity incentives world. Value creation is respectable corporate language. Wealth creation can sound faintly embarrassing, almost a dirty expression.

Boards will readily approve a share plan intended to create value for shareholders. Few will describe its purpose as building wealth for the people who receive the shares.

Yet that is precisely what equity is supposed to do. We routinely model how much executives or management teams might receive at different share prices or exit values, sometimes in life-changing amounts and then describe the purpose in the safer language of alignment, engagement and retention. The economics say wealth creation. The paper accompanying it rarely does.

Perhaps it should.

When wages no longer catch wealth

This matters even where conventional measures of wealth inequality have moved less dramatically than the public debate might suggest. The deeper problem is not simply how wealth is distributed at a particular moment. It is how difficult it has become for somebody relying on earnings to move through that distribution.

Recent Financial Times analysis estimated that median household net wealth, excluding pensions, has roughly doubled in real terms in the UK, US, Germany and France since the mid-1990s, while incomes have risen by only around 30%. On its calculations, the number of years of average UK earnings needed to bridge the gap between the bottom and top quarters of the wealth distribution has increased from about 20 to around 40. Wealth has not merely grown. It has moved further beyond the reach of wages.

Share plans cannot reverse house-price inflation, recreate affordable housing or compensate for the absence of inherited wealth. But they can give employees something which salary alone does not: a claim on future capital growth.

There is, however, nothing inherently equalising about equity remuneration. An executive LTIP or private equity MIP can concentrate substantial wealth among a small and already well-paid group. Even an all-employee plan will achieve little if the amounts are immaterial or participation is largely confined to employees who already have disposable income.

The question that surely matters most is whether the plan creates new owners.

Who supplies the first pound?

A useful first test is simple: who supplies the first pound?

In 2026, 22,348 Tesco employees, mainly working in stores and distribution centres, became eligible to benefit from Sharesave maturities with a potential aggregate value of £134 million. Employees who had saved an average of £91 a month under the three-year scheme stood to make a profit of £5,346. Those who had saved an average of £94 a month under the five-year scheme stood to make £8,004.

That is real capital. It might repay debt, support a house deposit or provide the foundation of a more diversified investment portfolio. Tesco’s Sharesave maturity shows what broad-based employee ownership can achieve.

It also exposes its limitations. The average participating employee first had to find more than £90 each month for three or five years. Those most in need of a route into ownership are often least able to afford the ticket.

An all-employee invitation does not necessarily translate into all-employee ownership.

Free shares change the equation because the employer supplies the starting capital. Based on its full-year 2025 results, Admiral announced free share awards worth up to £1,800 for each of more than 13,000 employees. Bank of America went further in scale, announcing $1 billion of awards under its broad-based Sharing Success equity programme in January 2026. Ninety-six percent of its workforce was eligible, senior management was excluded and the awards were additional to normal compensation and incentives. Most would be delivered in shares.

In both cases, the employer supplied the first stake.

Designing a plan that creates owners

Who supplies that stake is only the first design question. How it is allocated matters too. An employer contribution calculated as a percentage of salary largely reproduces the existing pay hierarchy. An equal-value award represents a proportionately larger benefit for lower-paid employees. Matching can similarly be concentrated on the first pounds saved, where it is most likely to bring somebody into ownership, rather than primarily rewarding larger contributions from those already able to afford them.

The test should continue through the rest of the plan. Is the equity additional to fair cash pay rather than a substitute for it? Can employees pause contributions when household finances become tight? Does the board track participation and accumulated value by pay band, rather than relying on a workforce-wide average which may conceal who has been left behind?

The UK does not need a new statutory framework to do this. The Share Incentive Plan already allows a company to give each eligible employee up to £3,600 of free shares in a tax year and to provide up to two matching shares for each partnership share purchased. The more difficult question is whether companies are prepared to use that machinery meaningfully.

Diversification must remain part of the design. Employees already depend on the company for their salary and perhaps part of their pension. Ownership should help them build wealth without leaving them dangerously exposed to one business. Sensible liquidity, clear financial education and an accessible route to diversify are therefore features of a good ownership plan, not arguments against one.

Public policy is already supporting employee share ownership at scale. HMRC estimates that employees received £1.23 billion of Income Tax and NICs relief through tax-advantaged employee share schemes in 2024/25. That figure covers selective EMI and CSOP arrangements as well as all-employee SAYE and SIP plans, with SIP accounting for £470 million. The scale of that support matters, but so does its distribution: who ultimately benefits and whether it creates owners who would not otherwise exist.

A route from work into wealth

No remuneration committee can solve wealth inequality. Most share plans will make no measurable difference to the national wealth distribution and some risk reinforcing it. But every company makes a choice about who participates in the wealth its business creates.

Perhaps the equity incentives world should be less coy about saying so. Value creation describes what employees may help the company achieve. Wealth creation describes what ownership may allow employees to build.

If meaningful equity remains concentrated among investors and senior executives, the company reinforces the divide between earning and owning. If the wider workforce receives a funded and meaningful first stake, work has at least one route back into wealth.

Most routes into wealth run through things employees do not choose: family, geography and luck. A share plan is one of the few routes a company actually gets to design.

At Burges Salmon, we help companies design and operate employee share plans that translate ownership ambitions into practical outcomes.