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The Employee Ownership Update

Loren Rodgers

June 1, 2018

(Loren Rodgers)

Forty-Two Percent of Inc. Magazine Best Workplaces Offer Employee Ownership

Forty-two percent of the companies in Inc. Magazine's Best Places to Work list offer some form of employee ownership. The results are based on a survey by Quantum Workplace of 81,365 employees in more than 1,800 companies who applied for the recognition. Companies could be as large as 500 employees. The ranking is based on engagement scores developed by Quantum Workplace on topics such as trust in leadership, career development, perks, financial rewards, and ability to have input that is listened to.

The survey also looked at a variety of financial and nonfinancial benefits. A list is available at The list and brief descriptions about the companies do not list which ones offer employee ownership. The website also does not indicate how Quantum measured employee ownership. Finally, some of the companies on the list are nonprofits or organizations whose legal form may not allow shared ownership. The survey found that 36% of the companies offer some form of profit sharing.

Schwab Survey Shows Sharing Equity a Significant Factor in Choosing a Job

The 2018 Equity Compensation Survey from Charles Schwab shows that 27% of 1,000 survey participants said that equity was "one of the main reasons" they took their current jobs, and 9% more said it was why they took the job. Fifteen percent said it was not a factor at all, and 49% said they were happy to get the equity, but it was not a main factor in the decision. About the same percentages said that equity was either the reason or a reason they stayed at their jobs. Three-quarters of the respondents said that having equity made them less stressed about their financial situations. The study was based on a survey of 1,000 participants in equity plans administered by Schwab, all in public companies. Most of the employees were in employee stock purchase plans (ESPPs), but some received equity grants of one kind or another (the report did not break out the numbers).

Employee Ownership in Convenience Stores

It might seem that convenience store chains are not the most likely business to find a high concentration of ESOPs. With their high turnover and dispersed locations, ESOPs might seem a challenge. In fact, of the top 60 convenience store chains ranked in CSP, a convenience store industry magazine, five have ESOPs (Quick Trip, no. 11; Wawa, no. 13; Sheetz, no. 17; Stewart's Shops, no. 27; and Huck's, no. 54).

Trends in Company Stock in Public Company Retirement Plans

In a May 31 article in Morningstar, Company Stock Ownership: The Risks Outweigh the Rewards, Mark Miller cites unpublished research by Vanguard that finds 90% of participants in defined contribution plans administered by Vanguard have no company stock in their retirement accounts, and 5% have 20% or more of their account in company stock. Miller argues that diversification is a good reason to minimize the amount of company stock in retirement accounts. Diversification is a solid principle in retirement planning, but especially in the case of private companies, it is not the only relevant point. Private companies with ESOPs are more likely to offer diversified plans in addition to their ESOPs. ESOPs are much more likely to be funded solely by the employer, and those employers also tend to contribute to such plans at above-average levels. See the NCEO article Are ESOPs Good Retirement Plans?.

The NCEO's 2017 Annual Report

2017 was an exciting year for the NCEO and employee ownership. Our 2017 Annual Report covers the highlights, from our major research finding on the economic well-being of employee-owners ( to our record-breaking annual conference and the first-ever Fall ESOP Forum and the new booklet Employee Ownership: Building a Better American Economy.

Upcoming Events

The 2018 Vermont Employee Ownership Conference will be June 8 from 8:30 to 5:00 in Burlington, Vermont. The Global Equity Organization's 2018 Northern California Forum will be June 14, 2018, at 11am. Learn more at the event page.

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