Management Rewards Through Stock Options INTRODUCTION The reward system of companies to offer executive managers and other high ranking members of the organization stock options is not a relatively new one. Stock options were used primarily in the 1980�s as a way for companies to save money right away that could be used for the growth of the company instead of paying it to executives to lure them to the company, as well as linking those particular managers� fortunes to that of the company which they were working (Associated Press, 2003.) Managers were offered the option to buy stock after it had reached a certain value in the stock market for a reduced price, often one that was more than fifty percent of what the stock was actually valued. This stock could then be either resold for a one hundred percent or more profit immediately, or held onto for future gains, with the sole discretion as to when to resell the stock being exclusively that of the manager or executive who owned the stock. For accounting purposes, this was a great way to avoid large expenses fo....

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