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European Employee Stock Ownership Plan (ESOP): the main structural features and pilot implementation in Slovenia

Author

Listed:
  • David Ellerman

    (University of Ljubljana)

  • Tej Gonza

    (University of Ljubljana
    Institute for Economic Democracy)

  • Gregor Berkopec

    (Institute for Economic Democracy)

Abstract

The American Employee Stock Ownership Plan or ESOP is a leveraged buyout mechanism so that the employees in a company can, in effect, do a leveraged buyout of part or eventually all of their own company. ESOP is one of the most successful and unifying models for employee ownership in the world. Europe, however, lacks a generic model that could help the fragmented attempts at promoting employee ownership. The method used in the paper is a qualitative analysis of the US ESOP. We find that there are certain central features to the US model that should be maintained in the European attempts, and that there are certain flawed features that should be replaced by a better legal-organizational structure. The purpose of this paper is to analyze the main features of the US ESOP model and to define a technical description of the European ESOP, which builds on the good features of the US model and improves the flawed features. The paper also introduces the Slovenian pilot implementation of the European ESOP. The implication of the paper is to provide clarity on the structural features of the dominant employee ownership models, and to inform policy makers promoting employee ownership in Europe.

Suggested Citation

  • David Ellerman & Tej Gonza & Gregor Berkopec, 2022. "European Employee Stock Ownership Plan (ESOP): the main structural features and pilot implementation in Slovenia," SN Business & Economics, Springer, vol. 2(12), pages 1-20, December.
    • Handle: RePEc:spr:snbeco:v:2:y:2022:i:12:d:10.1007_s43546-022-00363-7
    DOI: 10.1007/s43546-022-00363-7
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    References listed on IDEAS

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    Cited by:

    1. Tortia, Ermanno C., 2024. "Dividends, labor remuneration, and capitalization in worker cooperatives. Worker shareholding," MPRA Paper 122500, University Library of Munich, Germany.

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    More about this item

    Keywords

    Employee Stock Ownership Plan; ESOP; Employee ownership;
    All these keywords.

    JEL classification:

    • J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • P13 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Cooperative Enterprises

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