Question And Answer
Subject: does ESOP gives voting rights
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Querist: muskaan
Answered by:
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Date: June 22, 2023
Query asked by muskaan

does ESOP gives voting rights

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Answer given by

The equity shares granted under the Employee’s Stock Option Plan to an employee comes with a vesting period. It is only after the vesting period has ended and the employee has exercised his right to convert the option into shares (at an exercise price), the employees get voting rights along with title of the shares (section 43 of the Companies Act, 2013) It is however, important to note that if preference shares are granted under the ESOP, then voting rights are not included.

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