George Clason, in his classic book titled “The Richest Man in Babylon,” wrote this line: “A part of all I earned was mine to keep.” In the 1950s, a lawyer named Louis Kelso coined the term “Employee Stock Ownership Plan” (ESOP). The intent of ESOPs is to significantly increase employee incentives and productivity, while giving
Employee ownership has too long been overlooked as a win-win solution for businesses and workers alike. That’s the view of Bill Young, founder and president of the Toronto-based Social Capital Partners.
That’s because employee-owned businesses offer “a proven wealth-creating vehicle” for individual employees; long-term wealth can be more resilient than income,
When an owner of a privately held business is planning to retire, there are many ownership transition options to choose from. You can go the route of a management buyout, transfer to the next generation, a sale to a third-party buyer, an
In all the urgency of the pandemic and the economy’s re-opening, it is easy to ignore what other policies are going into place. But the fact is that much else is happening. As part of those non-pandemic measures, this White House seems determined to broaden corporate ownership throughout the middle class.
A first sign of this effort
Columbus entrepreneurs Todd Kaufman and Justin Searls sold their rapidly growing software consulting agency Test Double to their employees in April. They converted to an employee stock ownership plan, which cost employees nothing, allowed Kaufman and Searls to remain at the helm and positioned the company for accelerated growth over the next several years.
If your company is not sharing ownership widely with employees, it should. Don’t take my word for it. Billionaire entrepreneur Mark Cuban put it well in a recent LinkedIn interview:
Said Cuban: “If you’re running a company and you need help from your employees, give them equity. Give them stock in
Sen. Ron Johnson (R-Wis.), one of the most conservative members of Congress, and Rep. Alexandria Ocasio-Cortez (D-N.Y.), one of the most liberal, have both introduced sweeping proposals to broaden employee ownership in the U.S. That surprising fact testifies to just how practical—and urgent—this idea is.
Too many Americans have too
Stewart’s Shops said Tuesday it distributed an additional Employee Stock Ownership Plan dividend to its participating employees. The amount represents 4.5 percent of employees’ ESOP balance at the end of 2019.
The company said the employees, which it calls Partners, can either take the dividend as a cash payout or roll it over into their ESOP
The police killing of George Floyd has brought new awareness of systemic racism. Business leaders serious about ending racism need to look beyond forming a diversity, equity and inclusion committee or adding black faces to the C-suite. They must dive into the heart of racial
Employee Stock Ownership Plans (ESOPs) are utilized by many successful companies across the world. This case study describes Huawei, a Chinese telecommunications equipment company, which heavily utilizes ESOP ownership, and applies Huawei’s results to describe ESOPs as a powerful tool for achieving corporate efficiency and growth. Using and analysis of Huawei’s annual reports, we argue
The coronavirus pandemic has presented new challenges to virtually every company and individual in every discipline in the current economy.
Employee stock ownership plans (ESOPs) and their plan sponsors — as well as auditors of the plans — certainly will have new issues to consider as a result of the pandemic.
Today most ESOP companies are S
Here are four specific suggestions on things to re-design in the American economy to better serve the middle class without becoming a welfare state:
- Make education more useful for future middle-class workers. Change how curricula is developed in every state to include active participation from the business community. Currently, this is largely the province of
Employee stock option plans (ESOPs) are a key part of the employee benefits offered by companies today. Start-ups, in particular, use ESOPs as an effective recruitment tool to attract and retain talent. However, employers and employees often do not fully understand the terms and implications of such stock option schemes. From an employer’s perspective, such
On March 27, 2020, President Trump signed into law a massive $2 trillion stimulus bill, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act or the Act), aimed at shoring up the U.S. economy in light of the disruption caused by the coronavirus pandemic. In addition to the widely discussed individual stimulus payments,
An employee stock ownership plan, or ESOP, could be the key to unlocking a stronger workplace culture and improving your bottom line.
Employee ownership may sound like a novel idea, but it’s a concept that’s been around for decades. The legal groundwork for today’s ESOPs was first laid within the 1974 Employee Retirement Income Security Act
Employee Stock Ownership Plans (ESOPs) are popular both with owners looking for ways to increase employee engagement and involvement and with employees seeking to have some ownership in and benefit from the work they do beyond their salaries. For business owners, considering implementing an ESOP is one of many options they consider when looking at
The most fundamental tragedy of the coronavirus crisis is human. It is lives being lost. Somewhere close behind is the feeling of desperation shared by working people. In an economy where it is estimated that 50 percent of the labor force survives from paycheck to paycheck, we are facing an economic crisis of unprecedented proportions
It’s debate watch party night at Democracy Brewing in February, and as presidential candidates take the stage to sports-star hype introductions, the politics fans at this European-style beer hall are getting rowdy, like Patriots fans when Tom Brady takes the field. The biggest cheers come from two waiters when they see Bernie
There are a lot of myths and mysteries that surround employee stock ownership plans (ESOPs) and some of these misconceptions can scare landscape company owners away from considering this business option.
Make no mistake, some ESOP structures are complex, but they don’t have to be intimidating. Here are the basics of what an ESOP