Stephanie Silverman is the President and CEO of ESCA. Stephanie helped to found ESCA after she worked as an advocate for the federal laws that first allowed for the creation of S corporation ESOPs in 1996. Today, ESCA is the Washington, DC voice for more than 200 employee-owned S corporations whose mission is to advance and protect S corporation ESOPs, and which support and sustain employee ownership in every state in the nation.

A frequent speaker on federal public affairs and political strategy, she is also a recurrent guest lecturer in the law and policy departments of the University of Pennsylvania, Georgetown University Law Center and the George Washington University. She holds an MBA from the Wharton School of Business and an undergraduate degree from Duke University.

Interview Highlights:

1. Origins of ESCA and ESOP Legislation (00:31–02:56)

• In the 1990s, tax reforms disadvantaged pass-through companies (like S corporations), prompting the idea of transitioning ownership to employees.
• Stephanie Silverman worked on changing federal tax laws to allow S corporations to be owned by ESOPs. These changes became effective in 1998.

2. Founding and Growth of ESCA (03:19–03:50)

• ESCA started in 2001 with 10 member companies. Today, it includes nearly 220 member firms, primarily run by the companies themselves rather than trade staff.

3. Cultural and Economic Benefits of ESOPs (04:16–06:38)

• ESOPs align management and employee interests, foster engagement, and significantly boost retirement savings—often 1.5x to 3.5x more than 401(k)s.
• Most ESOP companies also offer other retirement plans, increasing employee financial security and retention.

4. Community Stability and Long-Term Vision (06:56–07:35)

• ESOP-owned companies are more likely to stay in local communities and avoid dismantling by outside buyers, like private equity or foreign entities.

5. Policy Advocacy and Legislative Defense (08:01–10:44)

• ESCA educates Congress and the administration on the technical complexities of ESOPs to prevent unintended consequences during policy shifts.
• For example, post-Enron reforms almost jeopardized ESOPs by limiting employee stock ownership.

6. Legislative Challenges and Wins (11:50–14:09)

• Every major tax reform poses risks to ESOPs. ESCA advocates to protect existing ESOP structures and ensure retirement limits don’t harm employee-owners.

7. Relevance in Modern Economy (14:35–17:20)

• With baby boomers retiring, ESOPs offer a viable succession strategy that preserves company culture and jobs.
• ESOPs provide stability, especially in uncertain economies, with lower bankruptcy rates than peers.

8. Increased Recognition of ESOPs (15:29–15:59)

• Well-known brands like Wawa and Clif Bar adopting ESOP structures have raised public awareness and demonstrated the model’s success.

9. Advantages Over Private Equity (17:59–19:10)

• While private equity can streamline and consolidate, ESOPs consistently outperform both private equity-owned and public companies in employee wealth and productivity.

10. Scalability and Economic Impact (19:10–19:33)

• Many ESOPs have grown from hundreds to tens of thousands of employee-owners, making a substantial impact on communities and the broader economy.

Connect with Stephanie on LinkedIn

ESCA, the Employee-owned S Corporations of America, is the voice in Washington, DC that speaks exclusively for employee-owned S Corporations (“S ESOPs”). Since 1998, ESCA’s membership has grown to represent more than 270,000 employee-owners across the country. ESCA company members engage in a broad spectrum of business activities and are a variety of sizes – from 25-person businesses to companies with 22,000+ employee-owners – but all have one thing in common: a commitment to protecting the S corporation ESOP structure and promoting it so that more working Americans can become employee-owners.

As an organization that is both company-sponsored and company-directed, ESCA is a reflection of the members it represents. ESCA’s government affairs efforts are led by a team of highly-regarded political and legal professionals who work at the direction of ESCA’s leadership, comprised of member companies.

Recent News: https://esca.us/newsroom/

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