Let’s Talk About SHifT
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In this episode of SHifT, I have the pleasure of speaking with John Stevens from Camilla Advisory Group about the successful use of Employee Ownership SHifT Trusts in Succession Planning.
John explored the differences between employee share ownership and an employee ownership trust, and the criteria for choosing between the two. The conversation also highlighted the positive impacts of employee ownership on company culture and community development, and the potential for tax incentives and financing through banks.
Employee share plans are typically restricted share plans or share purchase plans, which can be used as a retention tool and create a culture of employee ownership. In contrast, an employee ownership trust automatically makes all employees beneficiaries after one year of service, with benefits distributed based on a formula that can include salary, hours, and years of service.
John highlighted that employee share plans offer more flexibility, but do not provide the same tax incentives as Employee Ownership SHifT.
John emphasized that trusts work best for mature businesses with stable cash flows and established management, while share plans are more suitable for growing companies. Also noted is that the tax incentive is a key factor in choosing trusts as well as being administratively simpler for companies with high turnover.
This is why we all need to talk about this SHifT. Strategic, consistent conversations with experts will assist professionals and entrepreneurs alike to improve their business practices through interactive conversations inclusive of communication, leadership, culture, consulting, wellness, compensation, community, growth, and connection which creates actionable ideas for sustainable growth.
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