Employee Ownership Promotion Goes Grass Roots

By Anthony Mathews

For much of its life, the employee ownership movement has focused on enhancing federal law and tax benefits to incentivize business owners to share ownership with their employees either as a tax favored incentive system or a form of profit sharing or, in its most far reaching sense, as a business succession strategy. Our focusing on federal law, and the good work of The ESOP Association, Employee-Owned S Corporations of America and others has created some of the most lavish federal tax and financial benefits afforded to anyone, and, in the process created several thousand employee ownership companies with billions in company stock assets being held for millions of employees – that is, for people who would not have it otherwise. We can all be proud of that accomplishment, I think, but we are also puzzled that the movement has not spread wider. In fact there are about as many employee owned companies today as there were a decade ago – considerably more wealth within them, but not much (actually any) growth in their numbers. We can and do speculate on a number of reasons for this, but the truth is, we are not sure why.

A logical idea is that the most likely inhibitor of the broader spread of employee ownership lies in the conjoined facts that: a) decisions to adopt employee ownership for whatever reason are not made for national reasons. They are made locally by individual business owners for their individual reasons; and b) still today, the vast majority of local advisors to those business leaders and entrepreneurs know very little or nothing about employee ownership or, more difficult to overcome, what they “know” is just not so.

This idea was bolstered by the fact that clusters of employee ownership companies exist in the few areas around the country in which local information and support groups had been in existence to back up the national effort. Ohio and Vermont, for example, both have had local promotion and support centers for employee ownership for many years and, we think as a consequence, both places seem to have larger concentrations of employee ownership than would be expected otherwise. So, following their success, a broader initiative was begun to test the hypothesis further.

Facilitated by the National Center for Employee Ownership (NCEO), the potential solution that was put in play was based on the idea that progress in the spread of employee ownership will be facilitated most efficiently through a network of local and regional centers devoted to the spreading of information to the audiences we need to reach in order to spread the practice. These centers being established on a state-by-state basis can and do serve multiple purposes, but for the most part focus on being a local source of information that can be delivered directly to business owners and their advisors to be sure they have what they need to even consider employee ownership as an alternative for their planning.

As part of this initiative, a new center was established on the beautiful campus of UC San Diego as a part of the Rady School of Management as the California Center for Employee Ownership (CCEO). The CCEO has taken up permanent residence at the Rady School of Management right next to its older sibling, the Beyster Institute.

The CCEO mandate is to provide up to date, useful information to local business leaders and their advisors so that employees are on the front line of alternatives as those leaders and advisors begin to evaluate their plans for incentive programs and, more importantly, as the legion of baby-boomer business owners begin to evaluate their retirement options. Our toolkit starts with an executive board of employee ownership company CEOs, spread from Truckee to San Diego, who are willing to share their experiences with employee ownership business to business. The CCEO supports the board and the effort by providing a wide variety of scalable programs that can be offered to local groups of business people through the many existing networking vehicles and working with other interested organizations within our state.

We are doing presentations to local Vistage (and similar) support groups as well as offering education and assistance through Chambers of Commerce and local economic development offices around the state. In short, there is nowhere we will not go within our state to get the right information in front of the right people to help spread the influence of employee ownership on the California economy.

The focus of this effort is decidedly local, so the CCEO is focused on providing information in California, but we are also part of a movement that is attempting to assure that wherever one might be within the U.S. a similar assistance vehicle will be there to help. To date, there is a growing number of centers beginning to develop operations as follows:


California Center for Employee Ownership (CCEO)
Rady School of Management, UCSD
9500 Gilman Drive #0553
La Jolla, CA 92093
Attn: Anthony Mathews, secretary – amathews@ucsd.edu
(858) 822-6010


Ohio Employee Ownership Center (OEOC)
Kent State University
113 McGilvrey Hall
Kent, OH 44242
Attn: Roy Messing, executive director – rmessin2@kent.edu
(330) 672-0336


Pennsylvania Center for Employee Ownership (PaCEO)
P.O. Box 1607
Havertown, PA 19083
Attn: Kevin McPhillips – kevin@paceo.org
(609) 922-1111


Rocky Mountain Center for Employee Ownership (RMEOC)
110 16th Street, #1300
Denver, CO 80202
Attn: Halisi Vinson, executive director – halisi@rmeoc.org
(303) 351-2003


Vermont Employee Ownership Center (VEOC)
286 College Street
Burlington, VT 05401
Don Jamison, executive director - don@veoc.org
(802) 338-7448

Next on the list and currently in development will be the New York/New Jersey Center for Employee Ownership – operating out of Rutgers University, School of Labor and Management. 


So, if you are looking for help spreading the word, or if you think an employee ownership center would be a good addition to the business resources in your area, let any of us know.  We are all working together to spread the word and we can only do that with all of the employee ownership community’s help and commitment.  

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