Through ‘Ownership Trusts,’ Investors Can Help Employees Become Owners and Owners Retire
Employee-focused purpose trusts, or ownership trusts, could help address wealth gaps by cutting employees in on the wealth they helped create.
Common Trust is seeking to help meet the demand driven by a “silver tsunami” of owners over the age of 55 in search of a succession plan. As many as three in five U.S. businesses will seek a sale in the coming decade. Private buyers, such as private equity firms, are expected to meet only a fraction of that demand.
Employee ownership trusts are inexpensive to execute, flexible in design, and free of fiduciary issues that sometimes arise with employee stock options plans, another popular employee ownership tool. That makes them useful to companies with as little as 10 employees