What is Employee Stock Ownership Plan?

A definition of Employee Stock Ownership Plan

“An Employee Stock Ownership Plan (ESOP) is a program that provides a company’s workforce with an ownership interest in the company through stocks. This can serve as a benefit to motivate and reward employees.”

Employee Stock Ownership Plan in Business Glossary - What is an Employee Stock Ownership Plan?

Business Glossary > What is Employee Stock Ownership Plan?


Examples of Employee Stock Ownership Plan in a Sentence:

The company implemented an Employee Stock Ownership Plan to boost morale.

He received company shares through the Employee Stock Ownership Plan.

An ESOP can align employees’ interests with those of the company.

Why is Employee Stock Ownership Plan Important in Business?

Implementing an Employee Stock Ownership Plan can incentivize employees, boost morale, and align their interests with the company’s success. It also encourages long-term commitment and can potentially improve company performance.

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Associated Terms

Here are some associated business terms and synonyms for “Employee Stock Ownership Plan”:

  • ESOP
  • Stock Bonus Plan
  • Employee Share Ownership

Example of an Employee Stock Ownership Plan

Publix Super Markets operates under an Employee Stock Ownership Plan, making it one of the largest employee-owned companies in the United States. Through ESOP, their employees receive a share of the company’s success.

Final Notes on Employee Stock Ownership Plan

When considering an ESOP, factors such as cost, complexity of setup, and suitability for enhancing employee engagement should be evaluated. Companies should assess the impact on their corporate culture as well.


This has been a definition of Employee Stock Ownership Plan meaning.

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