Employee Ownership Blog

New data from the General Social Survey show that 20 million American workers own stock in their company through a 401(k) plan, ESOP, direct stock grant, or similar plan, while 10.6 million hold stock options.

A new review of existing research on ESOPs by Steven Freeman of the University of Pennsylvania finds that the plans generally lead to improved corporate performance, although primarily when combined with high-involvement management systems.

The Certified Equity Professional Institute (CEPI) at Santa Clara University has issued the first part of a three-part report on proper procedures for equity plan administration.

Institutional Shareholder Services (ISS), which provides guidance on corporate governance and other issues for institutional investors, is making available a reporting system that calculates the compensation expense of stock options according to the Hull-White Lattice model for valuing employee s

Once again, a majority (56%) of the 76 companies that have stock on the Great Place to Work Institute's Best 100 Companies to Work For" list have one or more broad-based employee ownership programs. Last year, the percentage of companies was exactly the same.

One of the largest ESOPs in a public company was that of Hooker Furniture in North Carolina. When the plan was formed in 2000, the company had about 2,000 U.S. employees, and the ESOP owned about a third of the stock. Now Hooker has shrunk to about 1,000 employees as a result of outsourcing.

In a January 25, 2007, letter to Zions Bancorp, SEC Chief Accountant Conrad Hewitt approved the bank's proposal to value its employee stock options based on the bank's auction of a tracking security called employee stock ownership appreciation rights (ESOARS).

In both substantive and financial terms, 2006 was one of the best years (and arguably the best) the NCEO has had. Those interested in viewing the annual report can find a copy in PDF format in the members area of our site.

On December 27, 2006, the IRS issued final regulations for compliance with S ESOP corporation anti-abuse rules (TD9302). Generally, the final rules make only minor changes to the existing proposed regulations.

While "Realities of Executive Compensation, 2006/2007," a new study from Watson Wyatt, focuses on executive compensation issues, the report also contains important findings on the use of options generally in large public companies.

A soon-to-be-published study by Takao Kato of "ESOPs" in listed companies in Japan finds that these plans now have a mean ownership of about 7% of company stock. Most listed companies have these trust-based plans (which the Japanese call ESOPs).

Employee Stock Ownership Plans: ESOP Planning, Financing, Implementation, Law and Taxation is a new book edited by Robert Smiley, Ronald Gilbert, David Binns, Ronald Ludwig, and Corey Rosen, and published by the Beyster Institute at the Rady School of Management at the University of Califo