Your annual ESOP statement gives you a terrific opportunity to make the most of employee ownership. Seize it by implementing these seven practical suggestions to increase understanding of your ESOP, strengthen your company’s culture, and promote employee ownership as a powerful tool for improved performance and employee retention.
1) Focus on WII-FM
Most of the time, we’re all dialed into the same radio station: WII-FM (i.e., what’s in it for me?). Take advantage of that singular focus by utilizing concrete, specific examples that illustrate what someone received from your ESOP in 2022. As you do that, show them where things like contributions, vesting and stock value appear on their statement. Because someone who cannot read and understand their statement is unlikely to recognize the ESOP’s tremendous value.
2) Share need to know information
As busy adults tuned to WII-FM, we seek out “need to know” information. We’re not as interested in things we ought to know or items it would be nice to know. As you communicate about your statements, make sure you share need to know information like why you have an ESOP, its value to employees and the company, how it’s an additional benefit (usually provided at no cost), how people earn ownership, and, of course, when do I get the money.
3) Make the connections between individual performance, company success and ESOP stock value
Many ESOPs use their statements to build the Golden Triangle of Employee Ownership. First, linking people’s daily actions with company success. Second, showing how business success enables the company to make the annual ESOP contribution. And third, how those two drive ESOP account value. Most people want to know the big picture (i.e., how is our company doing) and how they affect company performance/success in their daily jobs. The statement distribution process is an excellent time to discuss both, building tighter connections between individual performance and company success.
4) Use multiple channels
Take advantage of different channels to communicate your statements. You, for example, can hold in-person or virtual meetings and provide people with customized written materials, like our read the statement handout. You can also create a read-the-statement video that people can watch multiple times, and view at home with their spouses. Text or email employees performance highlights and statement information. People learn in different ways, so deploy as many channels as possible to send your message. Because more frequent communications about your ESOP’s value will enhance your ownership culture.
5) Get others involved to refresh your message
Been there, done that with your statements? Maybe it’s time for a new approach. Get others at your company involved in the process. If you have an ESOP Communications Committee, ask for their help. Contact us for new ideas and approaches – we have a number of practical activities and hands-on events to make your ESOP real to participants and build excitement and enthusiasm for its valuable benefits.
6) Remember that it’s more than just the money
We recommend that clients talk about wealth building when they discuss the ESOP, rather than retirement. Many young people believe they are never going to retire, but most of them are keenly interested in building wealth. Make the ESOP benefit’s potential real by utilizing our practical ESOPConnection account projection tool to illustrate what someone’s account could be worth.
Your ESOP isn’t just a wealth-generation tool though. Many companies implemented an ESOP as an ownership-transition strategy to maintain their operations, locations, employees, culture and values. Remind people that, without the ESOP, another buyer might have changed all that. In addition, the ESOP means that everyone is working for each other’s benefit, rather than an outside, often absent, shareholder. When you discuss your statements, don’t overlook the power of the cultural benefits of employee ownership. Those are happening right now, every day in your business, not just when employee owners receive a payout.
7) It’s a journey, not an event
With their statement in hand, people pay attention; they want to know what happened to their account and why. The statement distribution process provides you with a fantastic opportunity to scratch the ESOP itch. As you communicate your statements, remember that statement communications ought to be part of your ongoing process to build and strengthen your ownership culture, not a one-time event.
Implement these suggestions to seize the “statement day”. Because making the most of the annual ESOP statement will help you build an engaged, informed workforce that appreciates and understands the power and potential of employee ownership.
Let your Blue Ridge Administrator know if you’d like more information about our additional services like fun engaging presentations and written, electronic, text and video materials to make the most of the communication opportunity your ESOP statement provides. Our new communication team has more than 30 years of practical, field-tested experience serving ESOP leaders and committees. To learn more about how additional communication and ownership culture services can benefit your company, please visit https://workplacedevelopment.com.
