Op-Ed: Bring Back the Silicon Valley of the 1990s

In his April 10 article Reviving the Flagging Spirit of Silicon Valley in the Wall Street Journal, Michael Malone argues that Silicon Valley has lost its vitality because of the decline of what he calls "equitable equity." He describes equitable equity as "the attitude—and the practice—that all contributors to a company's success should have a material stake in that success." He specifically cites the practice of broad-based stock options, which give anyone—"scientist, entrepreneur, secretary or receptionist"—a chance to become rich.

The article, based on his keynote address at a meeting of Santa Clara University's Certified Equity Professional Institute and the National Association of Stock Plan Professionals, lays out a case for broad-based stock options and analyses the reasons that incentive compensation has become increasingly concentrated among executives, laying much of the blame on Sarbanes-Oxley, FASB's decision to require expensing of stock options, and then the rise of restricted stock units (RSUs).