Companies that encourage employee ownership – outperform - Succession Plus

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Companies that encourage employee ownership – outperform

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Companies that encourage employee ownership – outperform

By , February 4, 2014

In a recent report of results in the UK Employee Share Ownership Index ( EOI ) the 69 companies tracked in detail delivered total average returns of 53.3 % in 2013 – well above the 20.9 % average returns delivered by all 623 companies on the FTSE Index. The EOI tracks share price performance of companies where employees own more than 3 % of equity.

These results giver additional evidence to support the already overwhelming academic research which indicates improved performance , productivity and profit in businesses with an element of employee ownership.

Capital Strategies ( UK ) said that the EOI ended 2013 on an all time high and has outperformed the FTSA All-Share in all of the last six quarters.

As part of the recent Autumn statement the UK government allocated an extra $25M p.a. to support Employee Share Ownership Plans, which is in addition to the $50M as part of the March budget.

Craig West

Craig West

Managing Director | Succession Plus

Craig West is a strategic accountant who has over 20 years’ experience advising business owners. His background as a CPA in public practice, provided invaluable experience in the key issues of concern to business owners. Following 6 years of study to gain two masters degrees, Craig focused on Capital Gains Tax (CGT) for business sales advising on strategic management of tax issues. This experience formed a very strong view that business owners (and often their advisers) were unprepared and unaware of the steps required to prepare a business for exit.

Craig now acts as a strategic mentor for mid-market business owners and has written four critically acclaimed books on employee incentives, succession planning, asset protection and exit strategies. Craig has conducted numerous seminars and keynote presentations throughout Australia & internationally, including adviser education programs for the Institute of Chartered Accountants and CPA Australia.