The NY Times opinion page has an op-ed today urging retiring baby boomers to sell their companies to their employees, as New Belgium Brewing Company has. The article doesn’t mention this but New Belgium Brewing recently converted to a public benefit corporation under Colorado’s new law. What do ESOPs and social enterprise have to do with each other? I describe the connection in my forthcoming article Representing Social Enterprise (a recently revised version is found here). An excerpt:
A. How They Do It: Pluralist Ownership Business Model
A second model of social enterprise that turns on employing internal governance structures and practices to create a positive social or environmental impact is the pluralist business model. Advocates of this model argue that “sustainable social organization evolves out of equitable relationships” where distinctions between capital and labor are not “inevitable” and the employer-employee relationship is replaced by a pluralist ownership model.
[T]hese models challenge the prevailing views on who controls the enterprise and how surplus value should be distributed amongst stakeholders. They also challenge the reliance [in corporate law] on ‘independent’ directors to make ‘rational’ judgments to protect shareholder interests and favor internalization of conflicts and socio-economic thinking guided by corporate debate.
In the United States, the business models that align most with the pluralist ownership business model are so-called “democratic workplaces,” the most common of which are the employee stock ownership plan (ESOP) and worker cooperatives. Consider Publix Super Markets, an employee-owned supermarket chain in the southern United States. Publix Super Markets has more than 1000 stores and had net earnings of approximately $1.4 billion in 2011. The company’s stock is not traded on any securities market. Publix’s common stock is only available to its current employees (and their beneficiaries) through an ESOP and the company’s 401(k) Plan. Publix stock is owned entirely by its employees and its non-employee directors. ESOPs are implemented in companies for a variety of reasons: as a source of retirement funds for employees, to provide employees with a means of participation in company decisions, to maintain company culture or mission, and to align employee and management interests.
Although it is unclear whether this pluralist ownership model is the cause or an effect of Publix’s exceptional corporate social responsibility (CSR) initiatives, it is evident that Publix is a mission-driven company. Publix publishes a Social and Environmental Stewardship Report each year, highlighting its socially and environmentally-friendly business operations pertaining to recycling and waste management, resource and water conservation, greenhouse gas emissions management, sustainably-sourced products, salvage food program to feed the hungry, and LEED-certified stores. In 2011, Publix ranked first on the Corporate Social Responsibility Index produced by the Boston College Center for Corporate Citizenship and the Reputation Institute. The CSR Index bases its rankings on the perception of a company to the public in three areas: “citizenship” (i.e., socially and environmentally responsible impact on surrounding community), “governance” (i.e., fair, transparent, and ethical business practices), and “workplace” (i.e., fair employee treatment and investment in employee careers).
Worker cooperatives fully embrace the pluralist ownership model, perhaps to a greater extent than companies with ESOPs. The distinguishing characteristics of a worker cooperative are twofold: “(1) workers invest in and own the business, and (2) decision-making is democratic, generally adhering to the principle of one worker-one vote.” Governance rights are not tied to equity participation—each worker has one vote. Worker cooperatives are often employed as part of a larger community economic development and poverty reduction agenda, and as a means of establishing an equitable relationship between the capital and labor of a business.
Equal Exchange is an example of a worker cooperative. Equal Exchange builds long-term trade partnerships with sustainable farmers cooperatives and distributes fair trade products such as coffee and tea. Equal Exchange has a “one-worker, one-vote” governance structure with a board elected by co-op employees, a president that has the same single share as the other co-op members, and a maximum executive-to-worker compensation of 4-to-1. Daniel Fireside, the Capital Coordinator at Equal Exchange explains the connection between social enterprise and the pluralist ownership business model: “for social enterprises to claim the mantel of being socially responsible, you’ve got to do more than make a great product or treat your workers with respect. To make profound changes to the economy, you’ve also got to change the way you think of ownership, investment, and power.”
 Ridley-Duff, supra note 31, at 383-384, 386 (citing studies that support the idea that “sustainable companies (and economies) are built slowly by groups of people who collaborate over many years and not through deliberate agency of visionary leaders or charismatic entrepreneurs.”).
 Id. (using some United Kingdom companies as examples of companies that have embraced pluralist business models).
 Under ESOPs, employees own the stock of the company. Whether those employee-stockholders can truly be considered “owners” of the company is up for debate. Generally, stockholders are not considered “owners” of a widely-held corporation. As stockholders, they only have a residual interest in the firm’s assets. They do not have decision-making rights over the firm’s day-to-day activities, nor can they unilaterally dissolve the firm.
 Publix Super Markets, Inc., Annual Report (Form 10-K) (2012).
 There are numerous research reports that have found that ESOPs enhance corporate and worker performance, and others that find no such effect. See generally, Research on Employee Ownership, Corporate Performance, and Employee Compensation, National Center for Employee Ownership, http://www.nceo.org/articles/research-employee-ownership-corporate-performance (last visited Jan. 10, 2013).
 Publix Super Markets, Inc., Social and Environmental Stewardship Report (2011).
 Id.; Boston Coll. Ctr. for Corporate Citizenship, The 2011 Corporate Social Responsibility Index (2011), available at http://www.bcccc.net/pdf/CSRIReport2011.pdf.
 Boston Coll. Ctr. for Corporate Citizenship, supra note 46. Publix has been on Fortune’s list of the “100 Best Companies to Work For” since 1998. See Publix Super Markets, Inc., supra note 45.
 About Worker Cooperatives, U.S. Fed’n of Worker Coops., http://usworker.coop/aboutworkercoops (last visited Jan. 10, 2013); see also Puget Sound Plywood v. Commissioner, 44 T.C. 305 (1965) (defining cooperatives in a similar manner for tax purposes). For a thorough legal description of cooperatives, see Orsi, supra note 16, at 181-203.
 See, e.g., Gowri J. Krishna, Worker Cooperative Creation as Progressive Lawyering? Moving Beyond the One-Person, One-Vote Floor, 33 Berkeley J. of Emp. & Lab. L. (forthcoming 2013).
 Equal Exch., Annual Report (2011).
 Daniel Fireside, Equal Exchange’s Radical Approach to Corporate Social Responsibility, in Practicing Law in the Sharing Economy: Helping People Build Cooperatives, Social Enterprise, and Local Sustainable Economies, supra note 16, at 190-92.