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

David Ellerman (), Tej Gonza and Gregor Berkopec
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David Ellerman: University of Ljubljana
Tej Gonza: University of Ljubljana
Gregor Berkopec: Institute for Economic Democracy

SN Business & Economics, 2022, vol. 2, issue 12, 1-20

Abstract: 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.

Keywords: Employee Stock Ownership Plan; ESOP; Employee ownership (search for similar items in EconPapers)
JEL-codes: J54 K20 P13 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s43546-022-00363-7

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