ESOP Companies Outperform Stock Markets in 2002

August 7, 2003 ( - More than 80% of companies that are employee-owned through an Employee Stock Ownership Plan (ESOP) outperformed the broader market indices in 2002.

Among those companies that did not conquer the major market trifecta, 8% indicated having outperformed at least one index.   Conversely, 3% of the ESOP companies performed worse than all three indices, according to the Employee Ownership Foundation’s Economic Performance Survey.

If outperforming the markets is no indication, the vast majority of those polled are happy with their decision to offer an ESOP.   Eighty-six percent of companies declared that creating employee ownership through an ESOP was “a good business decision that helped the company.”

“Everyone who follows the stock market is aware that 2002 was an incredibly bad year for stock values in public companies, as measured by the primary stock indices,” commented Foundation President J Michael Keeling.    To this end, the study also found year-over-year improvement from 2001 among 55% of those firms canvassed, with 15% indicating nearly identical performance and 29% saying they did worse.

Also boosted for most companies were profits and revenues.    Over half (58%) said revenue increased, with 42% indicating revenue did not rise.   Comparatively, 59% held profitability improved, with 41% said profitability did not increase.

The 2003 EPS was distributed to The ESOP Association’s approximately 1300 Company members in July 2003. The results are based on approximately 370 responses.   More information can be found at .