At this giving time of the year, I am especially proud of how employee-owners strive for the shared good of the communities where they live and work. You don’t find many Ebenezer Scrooges among them. With over two decades steeped in employee ownership-related knowledge, I maintain that ESOPs and their participants overwhelmingly orient their business goals to the benefit of their communities.

So, again this Christmas, employees of Allen Insurance and Financial, an ESOP in Camden, Maine – who pay $1 into a fund to dress casually on Fridays – are distributing gifts and needed items for families bought from the fund.

This community-mindedness pays off for the companies as well as their localities. Purpose-led companies experience higher market share gains and, on average, grow three times faster than their competitors while achieving higher employee and customer satisfaction, research shows.

As Kimberley Jones, CEO of Butler/Till, an employee-and-woman owned marketing agency based in Rochester, N.Y., puts it: “Employee ownership is perhaps the best-kept secret of our economy. It strengthens communities, fosters a financially savvy workforce, increases resiliency during recessions, and offers big benefits during economic booms.”

In what ways do community-minded ESOPs make a big difference? Consider Sundt Construction Co. a general contractor based in Tempe, Ariz. The Sundt Foundation is 50% funded by employee-owners, and since 1999 it has contributed $14 million to 200 grants in 11 giving areas where employees decide what organizations get funds.

And in the Foundation’s first 23 years through 2022, employees have donated over 25,000 hours of volunteering. Among recent recipients: the Friendly Center’s The Power of Me after-school program in Irvine; St. Mary’s Food Bank in Tempe, Ariz., and in San Antonio, Texas, the Children’s Shelter and K9 for Warriors that provides service dogs to military veterans with post-traumatic stress disorder.

Giving back to its communities is also a distinctive part of Durham & Bates Insurance, a Portland, Ore., ESOP that won a Portland Business Journal Corporate Philanthropy Award for its community service and corporate giving. The company supports dozens of organizations, and its associates dedicate hundreds of hours and donate needed resources to organizations that feed families, provide clothing and shelter, and boost the arts and combat diseases. As the century-old company explains it, “Supporting others is a natural instinct for every one of our associates.”

Hypertherm is another standout ESOP. The New Hampshire maker of industrial cutting systems and software has a long-standing commitment to make a positive contribution to the regions where its 1,800-plus Associates live and work. It backs it up with 40 paid hours of community service time each year, whenever and anywhere its Associates choose.

Nearly two-thirds of Hypertherm’s Associates take advantage of the offer, in 2021 volunteering an average 21 hours of service that delivered nearly 25,000 hours of global volunteer time. Company Associates sit on nonprofit boards, coach sports teams and help at local family centers – whether they are work at headquarters, in the Minnesota office, or at Hypertherm’s small Italian factory, or at its Singapore and China facilities.

Giving back by ESOPs takes many forms. Consulting firm DK Pierce & Associates, a Zionsville, Ind., women-owned business, organizes the annual DKP Olympics, a series of games that raise funds for the fire and sheriff’s departments. Wiley/Wilson, a Lynchburg, Va., architecture-engineering firm employee-owned since 2004, specifically supports children and youth programs and was named the ESOP Association’s Mid-Atlantic Chapter Company of the Year for 2022. And Acadian Companies, a Lafayette, La., supplier of ambulance and emergency services 80% owned by employees, established 20 Explorer Scout posts throughout Louisiana, Texas and Tennessee.

Of course, employees of countless non-ESOP companies also volunteer their time and talents to helping their communities. But, for ESOPs, giving back to their community also helps their employee participants as owners. In addition to enjoying productivity, profitability, and growth rates that are greater than comparable firms, as documented by the National Center on Employee Ownership, the higher job creation and preservation translates into more income and tax revenues for their communities as well.

Another study funded by the Employee Ownership Foundation suggests ESOPs are more likely to remain in their communities for the long-term, something I’ve long suspected. The study also found that employee ownership contributes to a sense of stability and commitment to the local community.

This holiday season, when so many challenges abound, giving back and purpose aren’t merely business buzzwords to me. They are one of the secret reasons that successful companies flourish over the long-term.

From all of us at Verit Advisors, we wish you happy holidays and a happy, healthy, successful and prosperous new year.