CriticalRiver to offer ESOPS for all its employees to build loyalty, cut attrition

In a bid to promote loyalty and reduce attrition, technology solutions company CriticalRiver has floated a two-way ESOP (employee stock option) policy to give shares to all of its employees. The 10-year-old company, which has over 1,000 employees in nine global locations, has decided to give 100 shares to each of the employees every year.

The company, which registered revenues of $57 million in 2023, has also said that it is open for mergers and acquisitions as it targets to float an IPO in 2030.

“We will grant 100 ESOPs to each employee annually based on the years of service. Furthermore, each employee will get an additional 100 ESOPs each year. This move not only reflects the company’s belief in the power of collective ownership but also its dedication to building long-term relationships with clients and maintaining a positive company reputation,”  Anji Maram, Founder and CEO of CriticalRiver Inc, has said.

There is no lock-in period for the stocks granted through the scheme. “They are fully vested,” he said.

It means that the employees have total ownership of the stocks allocated to them through the plan without any riders. 

“Our attrition rates are below 10 per cent. We would like to reduce it further by giving them ownership,” Chandra Chandragiri, CFO and Co-founder of the company said.

Parallely, the company would give ESOPs based on the performance of the employees.

Citing a Harvard Business Review analysis, he said that businesses with at least 30 per cent employee ownership tend to be more productive, experience faster growth, and have a lower likelihood of going out of business compared to their counterparts.

“In addition to ensuring the continuity of quality talent, this model reinforces a customer-centric approach, where employees deeply invest in satisfying clients and meeting their expectations, thereby securing the longevity of the organisation,” Anji said.

“We are gearing up to increase our revenues to $500 million by 2030. We are open to mergers and acquisitions to reach the target,” he said.

Asked whether it is actively evaluating opportunities to acquire a company or get acquired, he said the company was open to both options.

Hiring plans

The company said it would hire 150-200 employees in the next six months for its India operations, which currently employ 500 engineers.