NCEO Data Sources on Employee OwnershipThe National Center for Employee Ownership has a number of data sources for scholars on employee ownership. Most of the resources are lists of companies, but we also have a detailed survey of more than 10,000 employee-owners at more than 50 employee ownership companies, mostly, but not entirely, ESOPs, that has been done for about 20 years. Details on how to access these data are at the end of this article.
U.S. ESOP Company DatabaseThe NCEO maintains the U.S. ESOP Company Database, a database of ESOP companies from data collected by the U.S. Department of Labor. The database is available for purchase either for the entire United States or for a specific region. Data is provided as a spreadsheet in Microsoft Excel format and includes a brief codebook describing the data and how to use it.
The U.S. Department of Labor (DOL) collects information every year on qualified retirement plans on its Form 5500 and schedules. The DOL now makes the full database of 5500 information publicly available in response to a Freedom of Information Act request. You can download the data yourself, but many users find it very difficult to figure out how to identify ESOP companies properly.
The NCEO Employee SurveysThe NCEO's Employee Ownership Survey database contains over 15,000 responses from employees at 91 employee-owned companies in the US performed over the last 20 years. The survey is designed to measure employee perceptions and beliefs in 13 category areas, such as plan understanding, entrepreneurship, trust in leadership, work atmosphere, and ownership concept understanding. In addition, the database also includes longitudinal data for some participating companies that have periodically administered the survey to their workforces. The survey captures employee perceptions on over 150 items, but cannot provide an objective measurement of actual understanding or employee behaviors. In addition, the database does collect some limited information on company demographics, such as employee count, geographic region, and industry. The database does not contain employee response data from non-employee-owned companies for comparison.
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The Employee Ownership 100We have been compiling a list of the largest 100 majority employee owned companies since the 1990s. The large majority of these companies are ESOPs, but some are owned directly by most employees of a company or are owned through some other kind of employee benefit trust. While we believe that each year's list includes the large majority of companies that meet this definition, we can only compile it based on personal knowledge of the company and press clippings. Government data do not indicate how much of a company an ESOP or other plan owns.
The list includes the company name, business, type of plan, location, and number of employees based either on direct contact with the company or, if they do not respond, the latest data from public sources such as Dun & Bradstreet. Every year the list appears on our newsletter for members, and the current list is always provided in The Employee Ownership 100: America's Largest Majority Employee-Owned Companies (at no charge). Past lists, dating back to 1997, are available at no charge to NCEO members by accessing the newsletter archive in the members-only area of this site. The list could be used to track employment changes at these companies over time as well as to generate names for further research. Virtually all of the companies on the lists are closely held.
The Best Places to Work Employee Ownership ListSince 2006, the March/April or May/June issue of the NCEO newsletter has listed the companies on the annual Fortune magazine "Best 100 Companies to Work For" list that have some kind of broad-based stock plan (ESOP, stock options or other individual equity, or employee stock purchase plan). Generally, about 40 of the organizations on the list (or about 55% of the organizations on the list that are not nonprofits or professional partnerships) have some kind of plan. Companies must have at least 1,000 employees to be on the list. A majority of public, but many are not.
Members can access the list, which indicates the company and the kind of plan, through the newsletter archive in the members-only area.
What We Don't Know
Corporate PerformanceWhile the studies on corporate performance have left most researchers fairly convinced that employee ownership and employee participation result in improved performance, we do not know a great deal about the texture of these results. What kinds of employee involvement work best? How durable are the changes? Do they plateau over time, for instance? In public companies, do ESOPs that are essentially just substitutes for 401(k) contributions, as many are, make any difference in performance, pro or con? In the equity plan area, we know even less. Do equity plans improve employee tenure or motivation? Do these companies have significantly different management cultures than comparable companies, and does that affect performance? Is there a threshold level for benefits from these plans to engage employees?
Employee Attitudes Toward OwnershipEmployee attitudes toward ESOPs were well measured in the 1986 NCEO study described above, but that study is aging and attitudes may have changed. We also have little information about employee attitudes toward ownership through stock option plans or 401(k) plans, both of which rely on very different mechanisms to enable employees to become owners.
Characteristics of Employee Ownership CompaniesWhile we know a lot about the demographic characteristics of ESOP companies, we do not know much about whether these companies are more or less participative in their management styles than non-ESOP companies, a critical question given the thrust of the research to date. Only the Ohio study in 1994 provides good data on this, but much more work is needed.
We also know very little about the typical financial structure of ESOP companies, nor are there any recent national data on plan characteristics such as voting rights, board representation, leveraging, annual contributions to the plan, etc. since the 1987 GAO study.
We have very limited information about employee ownership through 401(k) plans (other than a very preliminary NCEO survey) or stock option plans stock purchase plans (section 423 plans). There are good surveys of the characteristics of these plans (see the NCEO issue brief The State of Broad-Based Equity Plans for a review, but efforts to do employee surveys in these companies have not gotten very far. Few companies have been willing to agree to participate, and the costs of undertaking them are substantial.
Getting the Data and Other ProblemsData on the economic performance of public companies are available from a variety of sources, but data on private companies, other than sales and employment (available from Dun and Bradstreet), are not. Few private companies will provide financial data, making studies that rely on productivity, profits, stock prices, return on assets, or other measures, essentially impossible. "Date of plan announcement" data (for public company studies on market reactions to the stock price) can be obtained from annual reports. Because most broad-based equity plans are in public companies, good economic analyses would be possible if reasonable lists of companies and were available and information on plan start dates was included. Unfortunately, such lists do not exist and must be tediously compiled looking at one company at a time and hoping they reveal something about their plans.
One common problem in research on employee ownership is that it is often driven by data accessibility rather than the most interesting problems. For instance, a number of papers try to assess ESOPs in terms of results from public companies, but only 3% of all ESOPs are in public companies, the plans typically own less than 5% of the stock, and few are integral parts of corporate culture. In closely held ESOPs, the plans typically own at least 30% of the stock, about 40% own a majority, and the pans are commonly an important part of corporate culture. By compiling all these resources, we hope to help make this process easier for researchers to look at these questions instead.
Data on plan characteristics other than what is on the 5500 form must come from surveys. Survey response rates tend to fall between 5% and 25%, creating sample reliability issues.