CEDAR FALLS, Iowa – The Ford Foundation has approved a grant of $315,000 to the University of Northern Iowa Foundation to support the Iowa Center for Employee Ownership (IA-CEO) program, situated within the Wilson College of Business's economic outreach arm of Business and Community Services. 

There is an impending retirement cliff for Iowa’s privately-held business owners in the next five to ten years, set to disrupt local economies and the small communities that rely on their businesses' success. These leaders have a few options: transition ownership to a trusted leader, sell the business to a competitor or overseas investor or transition the company to an Employee Stock Ownership Program (ESOP).

“ESOPs are a proven alternative to selling a business and moving its operations,” said Stacy Mullinex, program manager of IA-CEO. “This conversion circulates the financial benefit of businesses back into the communities, increases wages, retains workers and enables employee wealth creation. In other words, ESOPs are a verified strategy to remove the financial inequalities often witnessed in rural and underserved populations.” 

However, five midwestern states (Arkansas, Iowa, Kansas, Missouri and Nebraska) underperform in ESOP metrics compared to other states per a 2021 study completed by Rutgers University. Without shifting economic practices in Iowa, residents will be adversely affected.

“The Ford Foundation’s support will allow IA-CEO’s team to generate awareness, provide resources and walk alongside companies who can benefit from the ESOP model,” said Deborah Giarusso, program manager at IA-CEO. “We are grateful to the Foundation for recognizing this need and supporting Iowa’s economic needs at such a critical time.”

In Waterloo, VGM Group is an example of a successful transition to employee ownership.

“VGM has thrived under employee ownership,” said Mike Mallaro, executive chairman at VGM Group. “The selling shareholders did extremely well in the sale. Employees who worked for the company earned life-changing wealth in the next decade and the community retained all the jobs. Big wins all around.”

IA-CEO will utilize the Ford Foundation funding to expand use of the ESOP model through education – in-person presentations, speaking engagements, webinars, and annual conferences—all on employee ownership. Individuals and organizations interested in exploring the power and potential of employee ownership are invited to save the date for the second annual Employee Ownership Conference on Wednesday, Oct. 16, in Ankeny. 

UNI’s IA-CEO and the Wilson College of Business will capitalize on this opportunity by collaborating with the Institute for the Study of Employee Ownership and Profit Sharing at Rutgers University to include Wilson College faculty in the institute's ongoing research fellowship programs, academic research conferences, Curriculum Library on Employee Ownership and other programs which the Institute has developed over the last three decades.

Learn more about IA-CEO, the conference, and how employee ownership might benefit your company at https://ia-ceo.org.