Systematic dierences in employee stock ownership plan contributions: some evidence Elaine G. Mauldin 1 School of Accountancy, 320 Middlebush Hall, University of Missouri-Columbia, Columbia, MO 65211, USA Abstract Under current federal law, ESOPs are intended to provide an employee bene®t and also meet corporate ®nancial objectives. These dual purposes may not always be compatible. This study examines total retirement plan contributions, using data from Department of Labor Form 5500s, and demonstrates systematic dierences in those contributions between companies establishing the ESOP for dierent reasons. A signi- ®cant increase in bene®ts after the ESOP is implemented is found in those ®rms using the ESOP primarily as an employee bene®t with no apparent ®nance objectives, while a signi®cant decrease in bene®ts is found in those ®rms using the ESOP primarily for corporate ®nance reasons. The dierence in bene®ts suggests that the reason an ESOP is adopted may make a dierence to the employees of the ®rm. Further analysis links total retirement contributions to a measure of ®rm productivity. ESOPs with positive in- creases in total retirement bene®ts are associated with increases in sales per employee. Ó 1999 Elsevier Science Inc. All rights reserved. 1. Introduction The Employee Stock Ownership Plan (ESOP) has been commonly promoted as an employee bene®t plan that can also provide a signi®cant source of cor- porate ®nance (Kaufman, 1997, p. 43; Flesher, 1994, p. 45; Szabo, 1989, p. 41). Legislated as part of the 1974 Employee Retirement Income Security Act (ERISA, 1974), ESOPs are retirement plans that also change the corporate Journal of Accounting and Public Policy 18 (1999) 141±163 1 Tel.: 1 573 884 0933; fax: 1 573 882 2437; e-mail: mauldine@missouri.edu 0278-4254/99/$ ± see front matter Ó 1999 Elsevier Science Inc. All rights reserved. PII:S0278-4254(98)10016-9