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Employee Incentive Plans | 9 Months Ended
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Sep. 30, 2023
Employee Incentive Plans [Abstract] |
Employee Incentive Plans | 10. Employee Incentive Plans Defined Contribution Plan The Company offers substantially all employees of U.S.-based operating subsidiaries who have met minimum service requirements the opportunity to participate in defined contribution retirement plans qualifying under the provisions of Section 401(k) of the Internal Revenue Code. The general purpose of this plan is to provide employees with an incentive to make regular savings in order to provide additional financial security during retirement. This plan provides for the Company to match 50% of the employees’ pre-tax contribution, up to a maximum of 10% of eligible earnings. The employee is vested in the matching contribution incrementally over six years of service. Included in employee compensation and benefits expenses in the condensed consolidated statements of comprehensive income was $6 million and $5 million of plan contributions for the nine months ended September 30, 2023 and 2022, respectively. 2007 Stock Incentive Plan On February 28, 2023, the Company amended the 2007 Stock Incentive Plan to increase the number of shares of Class A common stock authorized and reserved for issuance from 30 million to 40 million, which was approved by the Company’s stockholders at its 2023 Annual Meeting held on April 20, 2023, and the shares were registered with the SEC on July 27, 2023. Under the Company’s Stock Incentive Plan, up to 40 million shares of the Company’s Class A common stock may be issued to satisfy vested restricted stock units granted to directors, officers, employees, contractors and consultants of the Company. The purpose of the Stock Incentive Plan is to promote the Company’s long-term financial success by attracting, retaining and rewarding eligible participants. As a result of the Company’s organizational structure, a description of which can be found in “Business – Our Organizational Structure” in Part I, Item 1 of the Company’s 2022 Annual Report on Form 10-K, filed with the SEC on February 27, 2023, there is no material dilutive effect upon ownership of common stockholders of issuing shares under the Stock Incentive Plan. The issuances do not dilute the book value of the ownership of common stockholders since the restricted stock units are granted at market value, and upon their vesting and the related issuance of shares of common stock, the ownership of IBG, Inc. in IBG LLC, increases proportionately to the shares issued. As a result of such proportionate increase in share ownership, the dilution upon issuance of common stock is borne by IBG LLC’s majority member (i.e., noncontrolling interest), Holdings, and not by IBG, Inc. or its common stockholders. Additionally, dilution of earnings that may take place after issuance of common stock is reflected in EPS reported in the Company’s financial statements. The EPS dilution can be neither estimated nor projected, but historically it has not been material. The Stock Incentive Plan is administered by the Compensation Committee of the Company’s Board of Directors. The Compensation Committee has discretionary authority to determine the eligibility to participate in the Stock Incentive Plan and establishes the terms and conditions of the awards, including the number of awards granted to each participant and all other terms and conditions applicable to such awards in individual grant agreements. Awards are expected to be made primarily through grants of restricted stock units. Stock Incentive Plan awards are subject to issuance over time. All previously granted but not yet earned awards may be canceled by the Company upon the participant’s termination of employment or violation of certain applicable covenants before issuance, unless determined otherwise by the Compensation Committee. ‎ The Stock Incentive Plan provides that, upon a change in control, the Compensation Committee may, at its discretion, fully vest any granted but not yet earned awards under the Stock Incentive Plan, or provide that any such granted but not yet earned awards will be honored or assumed, or new rights substituted by the new employer on a substantially similar basis and terms and conditions substantially comparable to those of the Stock Incentive Plan. The Company expects to continue to grant awards on or about December 31 of each year to eligible participants as part of an overall plan of equity compensation. In 2021, the Company’s Compensation Committee approved a change to the vesting schedule for the Stock Incentive Plan. For awards granted on December 31, 2021 onwards, restricted stock units vest and become distributable to participants 20% on each vesting date, which is on or about May 9 of each year, assuming continued employment with the Company and compliance with non-competition and other applicable covenants. The vesting and distribution of grants prior to December 31, 2021 remain in accordance with the following schedule: (a) 10% on the first vesting date, which is on or about May 9 of each year; and (b) an additional 15% on each of the following six anniversaries of the first vesting. Awards granted to directors vest and are distributed as follows: (a) one-time award granted to external directors on December 31 of the year of appointment vests over a five-year period (20% per year) commencing one year after the date of grant, and (b) annual awards granted to all directors on December 31 of each year are fully vested and distributed immediately on grant date. A total of 36,609 restricted stock units have been granted to the directors cumulatively since the plan’s inception. The table below presents Stock Incentive Plan awards granted and the related fair values since the plan’s inception.
|  |  |  | Fair Value at
|  |  |  | Date of Grant
|  | Units |  | ($ millions)
Prior periods (since inception) |  | 27,018,109 |  | $ | 687
December 31, 2020 |  | 1,229,177 |  |  | 71
December 31, 2021 |  | 1,084,773 |  |  | 84
April 25, 2022 |  | 180,889 | 1 |  | 12
December 31, 2022 |  | 1,248,105 | 2 |  | 91
|  | 30,761,053 |  | $ | 945
______________________________ (1)April 25, 2022, the Company awarded a special grant of restricted stock units to employees. (2)Stock Incentive Plan number of granted restricted stock units related to 2022 was adjusted by 3,722 additional restricted stock units during the nine months ended September 30, 2023. Estimated future grants under the Stock Incentive Plan are accrued for ratably during each year (see Note 2). In accordance with the vesting schedule, outstanding awards vest and are distributed to participants yearly on or about May 9 of each year. At the end of each year, no vested awards remain undistributed. Compensation expense related to the Stock Incentive Plan recognized in the condensed consolidated statements of comprehensive income was $75 million and $64 million for the nine months ended September 30, 2023 and 2022, respectively. Estimated future compensation costs for unvested awards, net of credits for canceled awards, as of September 30, 2023 are $26 million. ‎ The table below summarizes the Stock Incentive Plan activity for the periods indicated.
|  | Stock
|  | Incentive Plan
|  | Units
Balance, December 31, 2022 1 |  | 4,756,761
Granted |  | —
Canceled 2 |  | 2,766
Distributed |  | (1,385,593)
Balance, September 30, 2023 |  | 3,373,934
_____________________________ (1)Stock Incentive Plan number of granted restricted stock units related to 2022 was adjusted by 3,722 additional restricted stock units during the nine months ended September 30, 2023. (2)During the nine months ended September 30, 2023, the Company reinstated 71,562 previously canceled restricted stock units. Awards previously granted but not yet earned under the stock plans are subject to the plans’ post-employment provisions in the event a participant ceases employment with the Company. Through September 30, 2023, a total of 1,320,900 restricted stock units have been distributed under these post-employment provisions. These distributions are included in the table above.

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