S corporation ESOPs Have a Strong Culture of Ownership Which Breeds Success

March 7, 2013

Home News S corporation ESOPs Have a Strong Culture of Ownership Which Breeds Success

Two ESCA member companies based in Kansas City, Burns & McDonnell and HNTB were recently celebrated in an article published last month in the Kansas City Star.  The article noted what many around the employee-owned community have known for years: employee-ownership, breeds success.

Both Burns & McDonnell and HNTB emerged out of 2012 with record sales. Burns & McDonnell led the way with a 46 percent increase in sales from the previous year, while HNTB’s sales grew by approximately 20 percent. These companies are experiencing impressive growth in a period when much of the private sector is still reeling from the most recent recession. Scott Smith, director of corporate development at HNTB, expects the trend to continue into 2013.

“(HNTB is) budgeting for double-digit revenue growth in 2013,” and “Our leading indicators also have us positive looking forward,” Smith said.

The unique culture of ownership seen among employee-owned companies is brought about by each worker having personal stake in the company and is a key component to the notable growth. In a study, Alex Brill, a former tax advisor to the Bowles-Simpson Commission, points out that, “Employee commitment has been found to be a driver of job satisfaction, motivation, and attendance.” HNTB and Burns & McDonnell are superb examples of 100% employee-owned companies that have developed strong employee-commitment among their workers, which ultimately has benefited their bottom line and makes these companies such great places to work.

The Alex Brill study also examined the growth of S ESOPs over the past decade and found that the unique strengths of employee ownership drove company gains and jobs, while helping insulate S-ESOP businesses from the adverse effects of the recent recession.

We congratulate HNTB and Burns & McDonnell on their continued success and look forward to watching them grow through 2013!

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