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The NCEO Registry

New Certifications for Employee-Owned Businesses

Interested? Let us know!

The National Center for Employee Ownership has created the NCEO Registry to certify employee-owned companies in which a majority of shares are held by individuals that are often excluded from ownership. 

The NCEO Registry offers three types of certifications: Majority Minority Employee-Owned (MMEO), Majority Women Employee-Owned (MWEO), and Socially and Economically Disadvantaged Employee-Owned (SEDEO). For convenience, they are collectively called the “NCEO Registry Certifications.”

The certification is based on the idea that employee ownership provides workers in every demographic category of the US workforce an opportunity to build economic well-being via an ownership stake in the companies where they work. Research demonstrates that employee ownership builds household wealth for working class people and that this impact applies across ethnic, gender, education level, and other demographic groups. (See the NCEO main research page and this video from the employee-owned company Lewis Services, the first company to receive an NCEO Registry Certification).

The NCEO Registry Certifications currently accommodate employee ownership via an employee stock ownership plan (ESOP). Updated standards, expected by the end of 2025, will incorporate worker cooperatives. Future updates may expand certification to include veterans, opportunities zones, or rural areas.

If you would like to know more about recognizing the NCEO Registry certifications for your own purchasing or other objectives, learn more in Can Employee-Owned Companies Help You Reach Your Diverse Spending Goals?

For more details about the certification process – including the 13 documents required for certification – read the NCEO Registry Certification Overview. The overview also covers the broad aims of this project, including the extent and impact of employee ownership

If your company is interested in the NCEO Registry certifications, learn more in Can Your Employee-Owned Company Receive Purchasing Preference Certification?

Companies interested in exploring whether the certification is a good fit for them can complete the form below to learn more.

Reach out with this form to get started

FAQ

There are currently three types of certification available:

  1. Majority Minority Employee-Owned, for companies with 51% or more of shares held by minorities.
  2. Majority Women Employee-Owned, for companies with 51% or more of shares held by women.
  3. Socially and Economically Disadvantaged Employee-Owned, for companies with 51% or more shares held by persons considered socially disadvantaged, per the Code of Federal Regulations.

We are exploring the feasibility of other certifications, such as a Rural Employee-Owned certification.

To be eligible for certification companies must be 100% employee-owned either  (a) via an employee stock ownership plan (ESOP), or (b) as a worker cooperative.

In an employee ownership trust (EOT), shares are never allocated or held by employees and therefore ownership cannot be established to the standard of this certification, and since EOTs are not yet defined by federal or state laws in the United States, there is no credible universal definition of what companies are EOTs. Companies that are owned by direct share ownership are capable of being certified by established third party certifiers.

In order to be certified, companies must:

  1. Be 100% employee-owned via an ESOP or worker coop;
  2. Be 51% or more owned by the demographic named in the requested certificate, and;
  3. Have an active company membership with either the NCEO or US Federation of Worker Cooperatives.

No. While both worker coops (as part of their one-share, one vote structure) and ESOPs (via ERISA fiduciary and governance protections) could be said to be controlled in some fashion by the employee-owners, this certification only takes ownership into account. In ESOPs, federal law ensures that the plan operates for the benefit of participating employees.

There are 13 documents in total required for certification, as detailed on page 6 of this overview document. Nine of these documents you will already have as a part of doing business. Two of these documents (the officers affidavit and the trustee letter) should be easily attained by the applicant. One document (the Form 5500) will be downloaded by the NCEO from the DOL website.

The final document is an Agreed Upon Procedures (AUP) report performed by an independent CPA to verify the company is 100% employee-owned with 51% of the shares covering the applicable demographic. The NCEO has created a methodology for this AUP report and can assist with finding CPAs ready to create the report for you.

After you have provided the first 12 documents, the NCEO will conduct an initial review, then provide you with instructions for the AUP report by the CPA. Following the completion of the CPA's report, the NCEO will conduct its final review of the entire application package. If all requirements are satisfied, the NCEO will issue a certificate and supporting materials generally within 10 business days. The whole process can take as little as two months, but may take more if your company needs time to assemble the documents or if the CPA takes more than two weeks to generate the AUP report.

Certification is valid for one year from the date you are officially certified.

Certification costs $1,000, $500 of which is a non-refundable administrative fee.

Yes, though the NCEO works with two CPA firms regularly on this project and we will happily facilitate working with them.

Yes, the certification is currently recognized by several independent companies as well as at least one group of purchasers. The NCEO is actively working with other groups of private sector purchasers to recognize the certification for their diverse supplier needs.

No, the NCEO Registry is currently not recognized by any government entities or agencies and there is no immediate plan to seek such recognition.

In the event your application is rejected, you will be refunded $500 and we will detail why your company was not eligible for certification. The NCEO will strive to make sure companies are aware of the requirements and confident in their ability to meet them before an application is submitted.