Is there any research on approaches to Long term incentive plans in privately owned businesses? Where share issue is not possible?

From our experience working with privately-held companies, most owners are not prepared to give up stock in their firms, even to their most critical employees. In order to level the playing field, however, when it comes to attracting, hiring and retaining capable, highly qualified managers, privately-held companies need to adopt some form of long-term incentives. This additional element of the compensation package will allow then to compete for qualified managers and executives, particularly those within publicly-traded counterparts, and to hold on to those that they have. Cash-based long-term incentives can take the form of Phantom Stock, Shadow Equity, and other similar forms of cash-based incentive, which allow the participants to share in the company\'s growth without the use of equity. These types of plans provide the missing element to the compensation package for non-owner executives and key employees, and in turn, provide the company with the means by which to focus attention of these participants on the future, long-term success of the organization.