Levitt welcomes employee share ownership results

There is news that companies with a significant level of employee share ownership produce higher returns on investment than does investment in more standard portfolios, says ESOP, the Employee Share Ownership Centre. ‘This shows that innovative methods of owning and managing companies can produce greater levels of employee engagement which, in turn, produce more financially sustainable businesses,’ says the writer and consultant and author of ‘Welcome to GoodCo’, Tom Levitt.

A theoretical portfolio of the 60 or so FTSE companies in which more than 3% of shares are owned by employees, ESOP demonstrates, would have outperformed the FTSE benchmark by +5.8% in 2014.

By comparison, the FTSE All Share Index under performed by -17.5%, the FTSE Small Capital Index (excluding Trusts) by -5%, the FTSE 100 by -2% and the FTSE All Share (excluding Trusts, based on total shareholder return) had a comparative figure of +1%.

‘It’s not just Employee Share Ownership,’ Mr Levitt continued, talking to Share Radio on 25th January 2015, ‘but companies with good CSR records and companies which comply with the UN Principles of Responsible Investment also perform above the norm. Why would you want to invest long term in anything else?’ Mr Levitt’s interview is in the first few minutes of the 30-minute ‘Shop Floor’ programme here.

More details on the ESOP web site.