Inštitut za ekonomsko demokracijo


We regularly organise online workshops and conversations with enterpreneurs. IED is also one of the main co-organizers in the Slovenian Congress for Economic Democracy.

On this page, you will find information about upcoming events, as well as a rich archive of recordings of past events.


By introducing innovative models of employee ownership and participatory leadershipgovernance, we promotefoster social justice, economic efficiency, social and environmental sustainability, workers’
dignity, and community-anchored business ownership.

European ESOP


With thousands of successful cases and millions of workers turned into co-owners, the Employee Stock Ownership Plan (USA) and the Employee Ownership Trust (UK) are two of the most successful employee-ownership models today. sloESOP is based on the European ESOP, which builds on that rich experience. Pioneered by the Institute for Economic Democracy under mentorship of David P. Ellerman, European ESOP takes the best features of both models while addressing their problems.

What's worth keeping?

– Leveraged buyout

– Individual ownership through individual capital accounts (ICAS)

– Possibility of gradual and partial conversion

– Sustainable ownership inclusive of all permanent employees

Our improvements

– Shares are continuously repurchased to provide better incentives, avoid repurchase liability, and ensure a more equitable distribution of risk

– The legal entity of the ESOP trust is a cooperative, which guarantees democratic representation – improving accountability and productivity – and makes the process of distributing ownership and voting rights among employees automatic.

How does the European ESOP work?

There are three step to the European ESOP transatios

1. Initial transaction

First, the value of the company’s shares is estimated.* After that, the seller of the shares (or an external creditor, who provides debt capital for the purchase of shares) receives a Note Payable from the company, which guarantees that dedicated contributions will be made to pay off the debt. Finally, the shares are transferred to the employee ownership cooperative (EOC), which now owes to the seller/creditor the agreed amount.

The valuation of shares is a crucial part of the ESOP transaction. The valuation for an ESOP buyout is different from a valuation done for a sale to an outside party. This is because in the former the shares are paid for through profits of the company and valuations are made on an annual basis.
For these reasons, we strongly encourage the use of net-asset valuation, which is the simplest and most transparent method.
ESOP valuations are likely to be lower than offers from external buyers. Nevertheless, sellers should consider the additional advantages of the ESOP sale:
1. Rewarding the employees that helped to build the company
2. Keeping the business and the jobs it provides anchored in the community and ensuring wages and taxes are respectively spent and paid in the community
3. Maintaining the organisational culture that the selling owner worked hard to establish
4. Increasing the likelihood of keeping the business alive and the entrepreneur’s legacy intact for many years to come.
5. Tax breaks may bring the net pay out closer to what the seller would receive with an external sale.

2. Paying out the seller

The company makes regular contributions to the EOC, which in turn transfers them to the seller/creditor to pay off the outstanding debt. As the loan gets paid off the shares are gradually allocated to individual capital accounts (ICAS) based on a pre-determined rule of share distribution (e.g., in proportion to salaries, on an egalitarian basis). It is only when the debt to the seller/creditor is fully repaid that all the shares will have been moved from the EOC to ICAs. The end of this stage marks the completion of the transfer of ownership.

3. Roll-over

The company continues to make contributions to the EOC even after the external debt is paid off. After the transfer of ownership is completed, the contributions are used to finance a program of continuous repurchase of shares from ICAS (on a “first-in, first-out” – FIFO basis), with oldest shares being bought from members and redistributed back to all the active members (those currently employed) on the basis of the chosen distribution rule. Liquidity is essential for this model to function.