To qualify for the list, companies must be at least 50% employee owned through an ESOP or other qualified plan and at least 50% of full-time employees must be eligible to participate in the plan.
For 2013, three Ohio companies made the list:
Davey Tree Expert of Kent, OH with 7,400 employees
Davey Tree has been recognized many times as a leading employee-owned company. Earlier this year, Davey Tree expanded it’s company by acquiring a tree company in Minnesota, marking Davey’s 15th acquisition in the last five years. Davey established an ESOP in 1979 and is now the fourth-largest 100% employee-owned company in the United States/
Riesbeck Food Markets of St. Clairsville, OH with 1,300 employees
Riesbeck began as a small family-owned grocery in Woodsfield, Ohio in 1926. Since then the company has grown to include 16 stores and 6 pharmacies throughout Ohio and West Virginia. The company established an ESOP in 1986, and is currently 57% employee owned and the Riesbeck family is still actively involved in the company.
Zandex Health Care of Zanesville, OH with 1,200 employees
Zandex, a provider of independent living, assisted living, rehabilitation and senior care established their ESOP in 1988. Based in Zanesville, the company now has facilities in New Concord, St. Clairsville, and Shadyside and offers an in-home emergency response team in Muskingum County. The ESOP which now owns 51% of the company.
On April 17, Senator Ben Cardin (D-MD) and Senator Pat Roberts (R-KS) introduced bipartisan legislation based on a survey released by the Employee Benefit Research Institute stating that 28% of Americans worry that they won’t have enough money to retire. According to Cardin and Roberts, Employee Ownership offers a sound solution to this problem.
Far too many Americans are inadequately prepared for retirement. Our legislation is about helping workers save by giving businesses the tools they need to create jobs and promote adequate retirement savings. It will strengthen a structure that promotes employee-ownership and helps workers build secure retirements…
-Senator Ben Cardin
Alex Brill of the American Enterprise Institute and CEO of Matrix Global Advisors, argues that employee stock ownership plans have higher productivity and resilience. The bill introduced by Roberts and Cardin would encourage the formation of S-Corp ESOPs, because this type of ESOP has been particularly successful in terms of longevity, wages, and growth.
S ESOPs have also proven more resilient in the face of economic distress, outperforming other private U.S. employers during the recent recession.
Among the positive impacts of an S ESOP according to Brill are $77 billion in labor income, $246 billion in output, and $27 billion in tax revenue from 1.4 million jobs. More details on the Brill’s research can be found in his study, Macroeconimic Impact of S ESOPs on the U.S. Economy.
More information on the proposed bill, Promotion and Expansion of Private Employee Ownership Act of 2013 (S. 742):
Earlier this month, SS&G, an employee-owned accounting firm based in Montrose, Ohio, celebrated their 25th anniversary. SS&G began with only 2 employees, and since then the firm has grown to become the 41st largest accounting firm in the US with more than $70 million in revenue last year and more than 450 employees. To celebrate their anniversary, the firm hosted a luncheon program for the Greater Akron Chamber’s Young Professional Network members. Read more on this story from the Beacon Journal.
Business Wire recently announced the accomplishments of Neuberger Berman since they converted to employee-ownership three years ago. In their goal to become 100% employee owned, the company committed to and began payments on equit purchases from Lehman Brothers Holding in April 2012. Since March of 2011, they have acquired $11.5 in new institutional business and increased mutual fund assets by 11%.
Long Island Business News reported that the employees of Peerless Electronics have purchased 100% of the firm through an ESOP as of May 30. The executives agreed that an ESOP was the best way to “ensure the continued success of Peerless for the benefit of its employees, customers and suppliers.
This article appeared in the New South Chapter of the ESOP Association quarterly newsletter and was shared by Bradley Arant Boult Cummings LLP.
When considering, creating and administering an ESOP, there are some important issues that should be considered including valuation, diversification, the role of employee owners, and debt services.
Regardless of how an ESOP is used, there are some unique concerns that plan sponsors, trustees, and other fiduciaries of such plans should consider in connection with the creation and ongoing administration of the ESOP.
The ESOP Association’s annual Employee Owner Retreat will be held in Downers Grove near Chicago, Illinois August 9-11, 2012.
The Retreat is a three-day, off-site training seminar, staffed by the Ohio Employee Ownership Center, where non-managerial employee owners learn from and interact with their peers from other ESOP companies. The program, geared toward hourly and salaried non-managerial employees, will help participants develop team problem solving skills, become more knowledgeable about ESOPs and company financial statements, and gain a new perspective on employee ownership at their companies through structured exercises and informal discussions.
This interesting article appeared recently on the Economic Intelligence Blog of U.S. News explaining how Employee-Owned businesses are the key to a “more robust and sustainable economy.”
The article focuses on the success of John Lewis Partnership in England. A company that is 100% owned by its 81,000 employees, and boasted a $13.7 billion in 2011 revenues. While remaining profitable during the Great recession, the company also managed to provide fair compensation and give employees control over the business through a “generative ownership” model. U.S. companies likewise benefit from employee ownership, often out performing similar non employee-owned businesses with “lower staff turnover, higher trust, and greater shareholder value.”
Ohio’s Employee-Owned Network (a program of the OEOC) is sponsoring a CEO/CFO Forum & Dinner for leaders in employee-owned companies on Wednesday, May 16, 5:30 P.M. – 8:30 P.M. in Ashtabula. The Forum and Dinner is being hosted by Ric Selip, CEO, and Donny Chaplin, Vice President of Grand River Rubber and Plastics. The Dinner portion of the program is being held at the facilities of the Spire Institute in nearby Geneva, OH.
In addition to the Forum and Dinner, there is a 4:30 P.M. tour of the Grand River facility.
For questions, email Jay Simecek or call the OEOC at 330-672-3028.
The purpose of the film is more than entertainment. In conversations with your humble scribe, Executive Producer Mary Ann Beyster expressed the additional goal that the film be a tool for broadening the discussion and teaching of the concept of employee ownership in the nation’s universities and MBA programs (a goal that we at the OEOC certainly applaud and support).
Scheduled for release in Summer 2012, you can view the trailer at the site linked above or on YouTube.
The Foundation for Enterprise Development was founded in 1986 by Dr. J. Robert Beyster. The Foundation’s mission is to promote broad-based employee ownership and entrepreneurism.
If you’re interested in learning “a better way of doing business,” we invite you to attend the 26th Annual Ohio Employee Ownership Conference. The conference, titled Employee Ownership: A Better Way of Doing Business, will take place April 20 in Akron, Ohio, and will feature keynote speaker Joseph Blasi.
Joseph Blasi is a professor at the School of Management and Labor Relations at Rutgers University where he was named to the post of Robert J. Beyster Professorship of Employee Ownership.
Attendees will have the opportunity to learn about various aspects of employee ownership, and meet with other network members. If you’re interested in attending you can register and find more information on the OEOC Website.