Employee Stock Option Schemes (ESOS) are programs set up by companies to incentivize and retain employees by granting them the opportunity to become shareholders in the company. These schemes typically allow employees to purchase the company’s stock at a pre-agreed price, called the exercise price, which is often below the current market value. For example, a company might provide an ESOS to its executive team, enabling them to align their financial interests with the company's performance over a specified period.

ESOS not only serves as a motivational tool for employees but also aids in attracting talented professionals by providing potential for capital gain. Over the duration of their employment, these schemes have vesting schedules that dictate when employees acquire the right to purchase stock. This creates a long-term engagement between the employee and the company goals.

As an example usage: "Our company offers an ESOS program where key employees can purchase shares at a discounted rate after completing three years of employment." In accounting, ESOS-related expenses are usually recognized in the company's financial statements and impact sections like stockholder equity and earnings per share (EPS).