According to the Employee Ownership Index (EOI) published by our Equity Incentives team, companies in the UK EOI continue to outperform FTSE All-Share companies over the long term.

Although employee owned companies underperformed in the second quarter of 2012, dropping 9.1% whilst the FTSE All-Share was down 3.7%, EOI companies in the UK have continued to outperform FTSE All-Share companies by an average of 10% each year since the EOI began.

Graeme Nuttall, head of the Equity Incentives team at law firm Field Fisher Waterhouse, and the Government's independent adviser on employee ownership, says:

"The Employee Ownership index continues to demonstrate that in the long term employee owned companies perform better and continue to be a successful business model.  The Government supports employee ownership and is committed to acting on recommendations put forward in the Nuttall Reviewwhich provides a framework to move this model into the mainstream of the economy."

Jo Swinson, Minister for Employee Ownership says:

"The Government has welcomed the excellent report by Graeme Nuttall and we will publish a full Government response to Graeme's recommendations this Autumn.  We have already published a call for evidence on the right to request employee ownership. There are many great examples of employee ownership in Britain and we wish to promote this business model more widely."

The EOI 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. Click here to view and for further information on the EOI.

10% EOI versus FTSE All Share from Jan 1992 to Jun 2012

Click here to view chart.