Employee Share Ownership Trust - ESOT

A program that facilitates the acquisition and distribution of a company's shares to its employees.




Taobiz explains Employee Share Ownership Trust - ESOT
ESOTs are trust accounts with which a company can sell its shares to employees. Some reasons to provide the ESOT include the following:

1. The ability for company to test out how an employee share ownership plan would work
2. The creation of a mini market for the transference of company's stock, which allows the company to obtain funds efficiently and educate their employees in share ownership
3. The provision of a tax incentive to shareholders should they decide to sell their shares in the company to the company's ESOT