The New Jersey Economic Development Authority (NJEDA) has announced partnerships with Onyx Partners Group and Lazear Capital Partners to aid New Jersey businesses in creating Employee Stock Ownership Plans (ESOP). These agreements, approved by the NJEDA Board, are part of the upcoming ESOP Assistance Program. The program aims to connect businesses with vendors for feasibility studies and technical assistance, which are crucial steps in establishing employee ownership models.
Governor Murphy's Executive Order No. 262, issued in 2021, established the Wealth Disparity Task Force to address wealth disparities affecting Black and Hispanic or Latino communities in New Jersey. ESOPs are seen as a tool to generate generational wealth for employees and provide succession plans for business owners.
NJEDA CEO Tim Sullivan stated that under Governor Murphy's leadership, New Jersey is building a stronger economy. "As part of ensuring equitable economic growth, ESOPs serve as a resource for New Jersey companies that want to craft sustainable business transition plans," said Sullivan. He emphasized that the program will help companies assess the feasibility of adopting an ESOP model by removing technical and financial barriers.
In collaboration with Rutgers School of Management and Labor Relations since July 2024, NJEDA has been working on educational programming to increase ESOP adoption among New Jersey businesses. Currently, there are 88 ESOPs in the state holding $64.9 billion in plan assets for over 423,000 employees and retirees.
Michelle Bodden, NJEDA Chief Diversity, Equity, and Inclusion Officer highlighted the significance of promoting employee ownership among people of color: "By promoting employee ownership models...we aim to build generational wealth and reduce economic disparities." She noted that converting businesses to employee ownership could significantly benefit Black workers by increasing household income up to 92 percent.
William Castellano from Rutgers expressed pride in partnering with NJEDA: "Together we are continuing our work to promote the many benefits of employee ownership throughout the State."
Onyx Partners Group and Lazear Capital Partners were chosen following a Request for Proposals process initiated in September 2024. The final approval of NJEDA’s ESOP Assistance Program is anticipated at an upcoming board meeting in March with applications expected to open soon after.
