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ABOUT ESOPS

 

An Employee Share Ownership Plan (ESOP) allows employees, who qualify, to purchase shares in their employer's company, with or without monetary assistance from the company.


Employees can acquire shares and ownership through an ESOP that can range from one percent to 100 percent.


The key aspect is that employees have an ownership stake in the company they work for, and share in the risks and rewards that accrue to it.


WHAT ARE ESOPS USED FOR?

ESOPS are an excellent tool to help recruit and retain talent, improve productivity and employee engagement (ESOP Culture). 


ESOPS also represent a viable method for business owners wishing to retire or sell their business (Succession Planning). 


ESOPS allow participating employees to build long term wealth and may also be a great source of capital for the company. 


ARE THERE DIFFERENT TYPES OF ESOPS?


Yes. There are three main tools companies can use to create an ESOP. 


These are: 

1) Equity shares - participate in share ownership 

2) Stock options - typically the right to purchase shares in the future 

3) Phantom plans - many of the benefits of stock ownership without actually giving any company stock 


Depending on the company and its goals, one or all three of these tools may be used. 




Membership has its privileges LEARN MORE



ARE THERE ANY GOVERNMENT PROGRAMS SUPPORTING CANADIAN ESOPS? 



Here are the programs we are aware of at the moment. This list may not include all programs out there. 


BRITISH COLUMBIA EMPLOYEE SHARE OWNERSHIP PROGRAM

MANITOBA EMPLOYEE SHARE PURCHASE TAX CREDIT 




ESOP QUESTIONS AND ANSWERS FROM THE EXPERTS

 

Click here to find answers to more detailed ESOP questions regarding Employee Participation, Tax, Legal, and, Valuation. 


WHAT ARE THE BENEFITS?


There are more than 40 years of research to show that ESOPS improve a number of business outcomes. To view the most recent research, visit our Research Page


WHICH CANADIAN COMPANIES HAVE ESOPS?

ESOPs are found across Canada, from small and medium-sized privately owned businesses to large publicly-traded firms. 

 

Some of Canada's most admired companies have ESOPS, including Friesens, PCL Construction, and Golder Associates. 

 

We are compiling a list of Canadian companies with some percentage of employee-ownership. Click Here  to see the current list. If you are Canadian employee-owned company and would like to be included in the list please let us know Contact Us



OTHER KEY ESOP RESOURCES AND SITES


International Association for Financial Participation (IAFP)

IAFP (https://aipf-association.fr/en/) promotes wider employee financial participation and share ownership among national associations, employers and interested academics. The association aims to support national organizations to develop and foster financial participation in their countries. IAFP members are national organizations, entities, and individuals willing to help develop financial participation.

The Employee Ownership Association (EOA) – United Kingdom

The EOA (https://employeeownership.co.uk/) is a not for profit and politically independent organization that works in close partnership with its members to champion, promote and provide insight into the business case for employee ownership. Members benefit from unique learning, networking, and trading opportunities across the network of diverse companies of all sizes and sectors.

National Center for Employee Ownership (NCEO) - USA

The NCEO (https://www.nceo.org/) is a nonprofit organization that has been supporting the employee ownership community since 1981. Their mission is to help employee ownership thrive. The NCEO is an invaluable resource for reliable information about the benefits of employee ownership, including technical matters and developing and maintaining ownership culture.

Employee Ownership Australia (EOA)

EOA (https://employeeownership.com.au/) is an independent not-for-profit organization funded entirely by its members. EOA’s mission is to promote awareness of the transformative power of employee ownership and to advocate for change at a legislative level so it becomes feasible for more businesses to implement employee ownership.