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EMPLOYEE OWNERSHIP STOCK INDEXES
INDICES
BOURSIERS DE L'ACTIONNARIAT SALARIE
USA
- Employee Ownership Index
United
Kingdom - UK Employee Ownership Index EOI
France - Indice de l'Actionnariat
Salarié IAS
UNITED
KINGDOM
UK
EOI - UK Employee Ownership Index
The
UK Employee Ownership Index has recently been re-launched
and from June 2013, it is calculated by FTSE International.
The UK Employee Ownership Index is an index of UK public companies
quoted on the London Stock Exchange and AIM which
have 10% or more of their issued share capital held
by or for the benefit of employees other than main
board directors. There is a separate version of
the index for companies that are 3% or more employee-owned.
Here
is the table of companies. The 10% EOI includes
19 companies and the 3% EOI includes 67 companies
(November 2013). By comparison, the EFES database
of employee ownership in European companies identifies
67 listed companies in the UK which have 10% or
more of their issued share capital held by employees
and 138 which are 3% or more employee-owned.
The index was created to test a hypothesis that businesses with
substantial employee ownership perform well over
the long term, due to their highly engaged staff,
high governance standards and long term outlook.
The hypothesis has been positively affirmed in the
academic literature, so the index was created as
a practical step to explore whether this theory
translated into superior long term shareholder returns.
It shows that companies in the Index regularly outperform the comparable
FTSE 100 and All-Share averages in previous periods.
Quite strangely, the 3% EOI outperforms the comparable
FTSE All-Share more than the 10% EOI, as can be
seen hereafter (Graph 1). This looks contradictory
with the former picture of how the 10% EOI outperformed
(Graph 2).
Graph
1
Graph
2
FRANCE
IAS
- Indice de l'Actionnariat Salarié
This
could be an interesting tool. However, most French
companies meet now the criteria. As a following,
the IAS finally replicates the common basis Index.
Killed by its own success.
USA
Employee
Ownership Index
On
June 19, 2017, the NCEO created the Employee Ownership
Index, an index of 28 publicly traded companies
that had both broad-based employee ownership and
had won one of three major national employer rating
awards, each of which puts a high emphasis on employee
engagement (Fortune's Best Companies to Work for,
the Gallup Engagement Index, and the Enterprise
Engagement Alliance awards). Broad-based employee
ownership included ESOPs where there was an average
account balance of $30,000 or more and companies
that provided equity grants to most or all full-time
employees.
For
the first year, the Employee Ownership Index has
a 30.3% return; the S&P 500 had a 15.5% return.
Research has overwhelmingly shown that companies
that have broad-based ownership and high employee
involvement in work-level decisions outperform other
companies. This is the first time, however, that
an index has been created that people can invest
in.
The
fund is available at Motif, an online trading platform
that allows users to create their own "motif," or
basket of stocks, to invest in. Investors can make
a motif an option for other users to buy. When you
buy a "motif," you are not buying a fund but rather
are investing in all the stocks and/or ETFs that
make up that motif. If you want to invest in the
Employee Ownership Index, you need to go to the
Motif website and open an account. Once you have
done that, you can trade the Employee Ownership
Index.
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