An employee stock ownership plan (ESOP) is a type of compensation plan that gives employees ownership interest in the company. ESOP and other share-based compensation are slightly more popular with startups and young tech companies in Singapore. ESOPs have also become an effective tool for liquidity in corporate finance and tax planning.
Share-based compensation (Equity compensation) is a method of paying employees, executives, and directors of a company with equity in the business. It is typically used to incentivize employees apart from normal salary compensation. An ESOP valuation is required at various stages of the business life cycle.