Japanese employees eager to use stock options in fiscal 2013
TOKYO -- Seeing their companies' share prices rise sharply, Japanese workers moved in droves to cash out stock options last fiscal year.
According to the Tokyo Stock Exchange, stock options were exercised by executives and employees at 1,683 companies in fiscal 2013, double the previous year's figure.
Stock options allow individuals to purchase their company's shares at a predetermined price some time in the future. Corporations distribute them as an incentive for executives and employees to help the company by working harder, giving workers a personal interest in seeing the shares climb.
Leading snack maker Calbee saw employees exercise options on 960,000 shares in February. The company distributed options to purchase shares at 400 yen ($3.86) each in 2005 and 2009. Since the shares rose above 2,500 yen at times in February, employees could pocket an extra 2,000 yen or so per share.
Allowing for differences based on rank and position, Calbee employees were thus positioned to enjoy effective bonuses of several hundred thousand yen to several million yen each. Calbee sees the system doing what it is meant to -- boosting morale.
Starbucks Coffee Japan, meanwhile, has even doled out the benefits to part-time workers, in addition to full-time staff. In June 2004, the company distributed options to purchase shares for 288 yen each. But its share price rose to around 1,200 yen in February, meaning that a part-timer with options on 100 shares could reap just over 90,000 yen of extra income.
Stock options are "a plus from the investor's point of view too, as they tend to motivate employees to try to push up the share price," says Takatoshi Itoshima of Commons Asset Management.