Long-term incentives in a family-owned group where issuing shares is off the table

Fourth-generation family-owned engineering group based in Austria, around 6,000 employees and EUR 1.4bn revenue. The family will not issue equity to non-family managers. We have for the first time a chief executive from outside the family, and the three-year cash bonus she inherited is based on a single profit figure.

She has asked for something closer to what she had at her previous listed employer. The family is open to a phantom share plan but worried about valuing the business every year and about a large cash payout in a bad liquidity year.

How have others in family or foundation-owned companies handled valuation and payout?