Compensation Elements
Long-term incentive (LTI)
Also called: LTI, long-term incentive plan, LTIP
Compensation that vests or pays out over multiple years, typically delivered as equity grants.
Long-term incentive plans deliver compensation that vests or pays out over multiple years — typically 3–4 — to align employee retention and decision-making with sustained performance.
Most common LTI vehicles:
- Restricted stock units (RSUs) — most common at public companies
- Stock options — common at startups and pre-IPO companies
- Performance shares (PSUs) — common in executive plans, vest based on performance metrics
- Deferred cash — used at private companies without equity available
LTI is a major lever for total compensation in tech, biotech, and senior-leadership roles. For executives and board members, LTI typically exceeds base salary.