An Employee Stock Ownership Plan (ESOP) is a benefit programme through which employees gain an ownership interest in the company they work for. In the United States, the term most commonly refers to a defined-contribution pension-like trust that holds company shares on behalf of employees, who accumulate shares over time and receive their vested balance when they leave the company or retire. Broader usage of the term refers to any structured scheme by which employees can acquire shares, including discounted share purchase plans and share grant schemes.
ESOPs serve multiple purposes: they align employee interests with long-term shareholder value, support retention of key staff, and, in privately held companies, provide a succession mechanism. Research by the OECD and academic institutions consistently finds that employee ownership correlates with higher productivity, lower turnover, and greater resilience during economic downturns.
In the Netherlands, the equivalent concept is often referred to as a "medewerker aandelenplan" or "werknemersparticipatie." Dutch tax law provides a favourable treatment for certain employee share schemes under Article 10a of the Wet LB 1964, allowing a discount on the purchase of employer shares up to an annual limit. Larger companies may also establish a participatiefonds to administer broad-based employee ownership.