An ESOP is an employee benefit plan which makes the employees of the company owners of stock in their company.  There are approximately 11,500 ESOP’s in the United States, covering 8.5 million employees.  The two most common uses of ESOPs are to buy the stock of a retiring owner in a closely held company and as an extra employee benefit or incentive plan.

The fundamental purpose behind the ESOP is to broaden the ownership of wealth by broadening access to capital ownership.  Employee stock ownership is intended to spread wealth by providing workers with access to capital ownership at no cost to themselves by making them owners of stock in the company where they work.  By giving all employees “a piece of the action”, the incentive for wealth distribution is based on free enterprise initiatives which give every worker a stake in the free enterprise economy, an incentive to improve productivity which can also result in financial benefits for all.  The dynamics of employee ownership can provide an effective means of encouraging greater use of participatory techniques and, at Owner Revolution Inc., we experience greater employee involvement.