PARIS — Swedish high street giant Hennes & Mauritz AB said its founders would donate shares worth one billion Swedish kronor, or $138 million at current exchange rates, to a fund that will pay out incentives to its long-term staff.
“The program is intended to further strengthen H&M as an attractive employer, which will also benefit future recruitment during H&M’s major global expansion,” the company stated.
The donation by the family of H&M board chairman Stefan Persson – son of H&M founder Erling Persson and father of chief executive officer Karl-Johan Persson – consists of 4,040,404 H&M shares to be paid into a newly established Swedish foundation, Stiftelsen H&M Incentive Program.
All employees are eligible for the incentive program, regardless of location, position or salary level. The qualification period is five years, barring local exceptions, and payment begins when the employee turns 62. However, staff members can also choose to receive payment of their portion after 10 years with the company, though no earlier than 2021.
H&M will contribute to the foundation every year an amount equivalent to 10 percent of the increase in dividend versus the previous year. The program will launch in 2011, pending approval by an extraordinary general meeting scheduled for Oct. 20.