New Study on "ESOPs" in Japan

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). There are no special tax benefits for employees to participate or employers to make a match, but employers typically contribute a 5% to 10% match and cover administrative and sales costs. Employees elect a trustee who independently votes the shares. About one-half of all eligible employees participate, with higher percentages in more successful companies. The paper, "The Determinants of Participatory Employment Practices: Evidence from Japan" is available online.