Mark Cuban Urges Companies to Share Financial Rewards With All Employees to Drive Long-term Success

Billionaire investor and Shark Tank star Mark Cuban urged all companies in a recent post on X to award stock options to their employees to drive long-term business success. He believes that stock options should extend beyond CEOs to employees so they have a stake in their company's success.

Cuban explained that billionaire wealth has increased by $33 trillion (£24.8 trillion) since 2015 because 'the stock market has gone straight up.'

'You know who is funding the increase, particularly lately? Retail investors. 401Ks,' Cuban wrote on X. 'The better question is, why are we not giving incentives to companies to require them to give shares in their companies to all employees, at the same percentage of cash earnings as the CEO?'

The billionaire proposed a system where stock options are awarded in the same percentage of salary across the company. It means that if a CEO receives stock options worth 100% of salary, then all employees would also receive stock options equal to 100% of their own pay.

While US megacap tech companies like Apple, Tesla, and Adobe allow their employees to buy their stocks at a discount, they have limits on how much employees can contribute. At the same time, C-level executives still receive a higher percentage of shares relative to their salaries.

For instance, Apple allows workers to buy stock at a 15% discount. Employees can contribute up to 10% of their salary or a maximum of $21,250 (£16,000) annually. However, around 78% of Apple CEO Tim Cook's pay last year came from stock awards. Stocks contributed over $58 million (£43.6 million) to Cook's $74.6 million (£56.1 million) overall pay in 2024.

JPMorgan Workplace Solutions reported that offering employees stock options encourages them to perform with an owner's mindset because they have a stake in the company. Apart from wealth growth, stock options also improve employee morale if the company continue to do well.

Cuban has long advocated for companies offering employees stock options. In 2020, Cuban said on the 'This is Working' podcast that companies will 'get more from your employees, and they will be more committed if you share equity immediately in a meaningful way, so that everybody rises.'

He himself has a proven history of sharing company wealth with his employees. However, the wealth distribution was mostly through cash bonuses rather than stock options.

'In every business I've sold, I've paid out bonuses to every employee there more than a year,' Cuban wrote in a post on X last year. 'Broadcast.com, 300 out of 330 employees became millionaires. Microsolutions, I paid out 20% to our 80 employees. HDNet wasn't as big, but paid out about 20% of what I got to employees. Mavs wasn't a total exit, but we paid out more than $35M to employees.'

When he sold his first company, MicroSolutions, to CompuServe for $6 million (£4.5 million) in 1990, Cuban gave each of his 80 employees a bonus of $15,000 (£11,295).

According to the Bloomberg Billionaires Index, Cuban has a net worth of $8.9 billion (£6.7 billion).

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