I found the results of our poll
last week of ESOP companies and professionals surprising and somewhat
pessimistic.
Our respondents believed ESOP
companies would fare slightly worse than their non-ESOP competitors with a
respondent’s rating of 2.3 out of 5.
The National Center for Employee
Ownership (NCEO) in a 2013 study found that “…firms offering ESOP significantly
outperform firms not offering ESOPs. Further, on average, as ESOP participation
increases within organizations, so too does firm profitability.”
“Research on Employee
Ownership.” NCEO,
www.nceo.org/employee-ownership-data/academic-research.
When asked if the current economy
would lead to more, fewer or the same number of new ESOPs, the average answer
was 2.56 out of 5, leaning to more over flat. I personally would not start an
ESOP in an uncertain economy, particularly if my company’s value is being depressed.
The attitude towards the
Election is interesting. With an average
rating of 3.67 out of 5, respondents thought a change in Administration would
be a positive for ESOPs. With an average
rating of 2.67 out of 5, respondents thought a continuation of the current
Administration would be a positive.
Apparently, some respondents believe that neither a change nor no change
would affect ESOPs.
Lastly, the average respondent thought
the status of ESOPs would be basically neutral in 5 years compared to today,
with an average rating of 2.4 out of 5.
Share your life
experience and knowledge. What do you
think the impact will be? Post your comments
on our Insights page: Insights