Employee Ownership Blog

Kimberly McCourtney

2025 Business Valuation Trends: Insights from Ken Serwinski

During our February CEO Peer Network meeting, we had the pleasure of welcoming guest speaker Ken Serwinski to our discussion on valuation. He posed a key question: “Valuation projection challenges...what should drive your thought process?” Ken brought his expertise spanning over 30 years in the ESOP space. His insights provided a valuable framework for understanding the factors that will shape business valuations in the coming year.

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Corey Rosen

Loren Rodgers

Withdrawn DOL ESOP Valuation Regulations Provide Insight

Summary

In December 2024, the U.S. Department of Labor (DOL) issued proposed rules that would govern the valuation of company stock in an ESOP. Although the Trump administration withdrew the rules in January, the 2022 WORK Act requires the DOL to issue valuation regulations, so while the fate of those withdrawn rules is uncertain, they provide insight into the DOL’s perspective under the Biden Administration and possibly the new administration. When new political leadership at the department is in office, a new proposal for the rules may be materially different from the withdrawn rules.

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Loren Rodgers

DOL Employee Ownership Head Reinstated

On March 7, the American Federation of Government Employees (AFGE) was notified that all probationary employees at the Department of Labor who received termination notices on February 21, including Employee Ownership Division chief Hilary Abell, would be reinstated. The reinstatement will be effective as of Monday, March 10, according to the Plan Sponsor Council of America.
 
Lisa Gomez, the former head of the Employee Benefit Security Administration (EBSA), said, "With the decades of experience she brought to the role, Hilary's contributions to EBSA's Division of Employee Ownership have built a critical and meaningful connection between the Department of Labor and the employee ownership community. Without her reinstatement, that foundational work would have been needlessly lost."

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Corey Rosen

Seventeen of the Largest 100 Private Companies Have Employee Ownership

Seventeen of the Forbes 2024 list of the largest 100 privately held companies (ranked by sales) have some form of employee ownership. Five are 100% ESOP-owned, four are minority ESOP-owned, two have profit-sharing plans primarily invested in company stock, one is an employee ownership trust, and one is a broad-based partnership available to employees at all levels. Supermarkets, convenience store chains, engineering, and construction are the most common industries among the employee ownership companies. We also compile a list of the largest employee-owned companies for our yearly Employee Ownership 100. That list includes only companies for which we have reliable external verification that their plans are broad-based, and it also focuses on majority and 100% employee-owned firms and the active participants they cover.

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Scott Rodrick

DOL Employee Ownership Head Laid Off

Update: As of March 7, the recently terminated head of the Division of Employee Ownership is to be reinstated March 10.

The National Association of Plan Advisors (NAPA) reports that Hilary Abell, who in July 2024 was appointed as the head of the Division of Employee Ownership at the Employee Benefits Security Administration (EBSA) within the U.S. Department of Labor (DOL), has been terminated as part of a wave of actions across the U.S. government.

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Corey Rosen

NY Bill Targets MWBE Barriers for Employee-Owned Firms

New York Assembly Bill 5649, authored by Democratic Assembly Member Stefani Zinerman, directs the New York State advisory panel on employee-owned enterprises to evaluate barriers to certification as minority- and women-owned businesses (MWBEs) for employee-owned businesses and recommend strategies for retaining the MWBE status of existing certified business enterprises when they become employee-owned. The commission was established in 2022 to report on how the state could encourage employee ownership but has yet to issue any recommendations. The NCEO has an article on ESOPs and preferred-status certification with background information and recommendations.

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Corey Rosen

Trump Selects Daniel Aronowitz to Head EBSA

President Donald Trump selected fiduciary insurance company executive Daniel Aronowitz to head the Employee Benefits Security Administration (EBSA). Aronowitz currently is the head of Encore Fiduciary (formerly Euclid Fiduciary). The company provides fiduciary insurance, fidelity bonds, cybersecurity insurance, and fiduciary insurance consulting. He is the author of the Fiduciary Liability Insurance Handbook. The book’s only mention of ESOPs is to say that this kind of fiduciary insurance is more costly than that needed for other retirement plans.

If approved by the Senate, Aronowitz would succeed Lisa M. Gomez and work under Lori Chavez-DeRemer, Trump’s pick for Secretary of Labor, who is also up for Senate approval. Chavez-DeRemer has been an ESOP advocate; Aronowitz does not appear to have taken any public position on ESOPs. 

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