Employee Stock Ownership Plans (ESOPs)

Employee Stock Ownership Plans (ESOPs) are programs that provide employees with ownership interest in the company they work for, usually in the form of company stock. This gives employees a stake in the company's success, potentially leading to greater motivation and productivity. ESOPs are often used as a retirement benefit, allowing employees to accumulate wealth over time. Companies may contribute new shares, or cash to buy existing shares, creating a tax-advantaged method for companies to offer an ownership stake to employees, enhancing loyalty and aligning the interests of employees with those of the company.