Printed from the Field Fisher Waterhouse web site
Web address: http://www.ffw.com/latest-news/2009/oct/employee-owned-companies.aspx

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Employee owned companies continue to outperform the FTSE All-Share as third quarter of 2009 sees employee owned company

29 October 2009

Employee owned companies outperformed the FTSE All-Share Index in the third quarter of 2009 according to the UK Employee Ownership Index (EOI) published by law firm, Field Fisher Waterhouse LLP.

Employee owned companies’ share prices were up 27.6%, performing better than FTSE All Share companies’ share prices which were up 21.3% over the quarter.

The EOI, compiled by the firm’s Equity Incentives team, monitors the share price performance of listed companies, comparing the performance of FTSE All-Share companies with companies that are over 10% owned by employees.

Employee owned companies have consistently outperformed the FTSE All-Share over the course of 2009, a trend that is also seen over the long term.

Over the last 17 years, employee owned companies have outperformed FTSE All-Share companies each year by an average of 10%. Over successive three year periods they have outperformed by 41% and over successive five year periods by 78%.

An investment of £100 in the EOI in 1992 would at the end of September 2009 have been worth £663 whilst the same investment in the FTSE All-Share Index would be worth £212.

 

EOI versus FTSE graph

Graeme Nuttall, head of the Equity Incentives team at Field Fisher Waterhouse says:

“Throughout 2009 we have seen employee owned companies outperform the FTSE All Share. This reflects the long term view – in 17 years of monitoring their share price performance we have seen that despite short term fluctuations employee owned companies are more successful.”

The Equity Incentives team at Field Fisher Waterhouse produces quarterly reports on EOI performance which are regularly referenced by the media, most recently Radio Four’s Today programme and Scotland on Sunday. The team advises on employee ownership solutions for a variety of business structures as well as incentive plans for UK and overseas listed and private companies and has had detailed and broad ranging input into Government share plans policy.

For further press information please contact:
Louise Eckersley, PR Manager, on +44 (0)20 7861 4120.