Talk about being stranded between the devil and the deep blue sea. The board of Eircom is on the verge of making a decision on the price at which senior executives in the company will be able to buy shares under an option scheme. It has to ask the army of small investors to back the option scheme at its annual general meeting on September 13th and must send out those details three weeks in advance.

The problem for the board and the executives is how to retain motivated staff without totally brassing off the shareholders who have seen the value of their shares tumble from a flotation prices of €3.90 and a high of €5 shortly thereafter to a price currently languishing around the €2.60 mark - wiping a third of the initial investment.

Already, the company has been at loggerheads with the Irish Association of Investment Managers, unhappy over the lack of defined targets for executives in return for such options.

The argument is that, when the present poor market for telecoms recedes together with the overhang from the soon-to-be-sold KPN stake and the Telia shares - the Eircom shares would be expected to rise anyway without any assistance from the executives. Why then should those executives profit hugely from events beyond their control by setting an option price at the current basement level of the stock? Why indeed? There is nothing to stop the Eircom board setting the option price above the current market level, giving executives a reasonable chance of reward without rubbing the faces of investors and customers in it.

Dominic Coyle can be contacted at dcoyle@irish-times.ie.