Employee Owned companies in UK outperform FTSE

Employee owned companies outperformed the FTSE All-Share in the first six months of this year, according to the UK Employee Ownership Index (EOI) published by law firm Field Fisher Waterhouse.

The EOI, compiled by the firm’s Equity Incentives team, monitors the share price performance of listed companies, comparing the performance of FTSE All-Share companies with ‘employee-owned companies’ i.e. companies that are more than ten percent owned by employees.

The EOI started in 1992 and shows that over 18 years, employee owned companies have outperformed FTSE All-Share companies each year by on average 11 percent. Over successive three-year periods they have outperformed by 38 percent and over successive five year periods by 74 percent. An investment of £100 in the EOI in 1992 would at the end of June 2010 have been worth £647 whilst the same investment in the FTSE All-Share Index would be worth £212. Graeme Nuttall, head of equity incentives at Field Fisher Waterhouse said: “The EOI demonstrates that this trend is also seen over the long term – employee owned companies generally do better over time than FTSE All-Share companies.”

Employee Owned companies in UK outperform FTSE was last modified: January 7th, 2014 by Craig West

facebooktwittergoogle_pluslinkedinmailby feather
Related posts:

ESOP COMPANIES OUTPERFORM (61.8)
Employee Share Ownership Plans ( ESOP ) – some performance statistics (16.4)
Employee equity plans in small, medium enterprises (13)

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.