EFES NEWSLETTER - MARCH 2021
the beginning of the year, the number of Employee Ownership
Trusts in the UK has been growing at an increasing rate.
At this pace, the number of companies passed on to employees
will double this year to 600 or 700. Since the formula
was put in place in April 2014, just a few years ago,
it has been a success.
In comparison, France set up a "takeover FCPE"
system in 2006.
France, too, the figure is rising sharply. Indeed, only
two cases of company transfers to takeover FCPEs had
occurred between 2006 and 2020, but this number could
rise to three in 2021, i.e. +50%. This would place France
not far from the +100% expected in Great Britain and
in any case much higher than all other European countries.
The takeover FCPE was designed on the same principle
as the FCPEs that are so successful in large companies.
In both cases, these are employee share purchase plans.
Under the share purchase plans, employees are invited
to invest a portion of their savings in company shares.
To this end, they benefit from incentives (price discounts,
company contributions, tax bonuses, etc). These plans
are well suited to large companies, whose size is a
factor in mitigating financial risk.
On the other hand, buying the shares of an SME is a
much riskier operation. And the investment by employees
in an SME is generally made during a business transfer,
so a significant part of the company, often 100%, must
be purchased. Generally, employee savings are not within
the scope of such an operation.
The countries that have been most successful in organising
an employee ownership policy in SMEs are those that
have adopted financial mechanisms that are essentially
different from share purchase plans.
ESOP plans in the United States and Employee Ownership
Trusts in the United Kingdom are not employee share
purchase plans. Employees do not take the risk of investing
their personal savings. These employee share ownership
plans are therefore much less risky. And yet they allow
employees to become owners of their company, often 100%
There is nothing to prevent the same financial mechanisms
being adopted in France. Nothing serious stands in the
way of implementing an effective employee share ownership
policy in SMEs, thus heralding a new French success
have a selection of 34 remarkable articles in 11 countries
in February 2021: Canada, Germany, France, India, Italy, Netherlands,
Norway, Poland, Tunisia, UK, USA.
Make employee ownership a cornerstone of Canada's economic
Germany: The Great Misunderstanding of employee share
ownership and startups. Why the ignorance of politicians will
lead to more incentives for employee ownership in large companies,
while the demand comes from startups. German trade unionism
and employee buyouts.
France: Record level for employee share ownership at
EssilorLuxottica. Business transfers through workers' co-operative.
Threats for employee shareholders of Natixis.
India: Employee share ownership increasingly popular
Italy: Role of employee share ownership in the governance
Netherlands: Employee ownership for startups.
Norway: New report commissioned by the financial sector
union recommends the development of employee share ownership
Poland: New report: Employee share ownership is the
missing link of the labor market.
Tunisia: For a Tunisian ESOP plan.
UK: Employee Ownership Trusts are multiplying faster
USA: Unlike Employee Stock Ownership Plans,
EOT is not a retirement program and employees do not receive
an equity stake in the company.
The full press review is available
political roadmap for employee ownership in Europe
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