Final answer:
An Employee Stock Option Plan (ESOP) is a program that allows employees to purchase shares in their employer's company, potentially at a discount, making them part owners and incentivizing their interest in the company's success.
Step-by-step explanation:
The type of plan that involves employees purchasing shares in a company is known as a Employee Stock Option Plan (ESOP). This plan allows employees to buy stock in their employer's company, often at a discounted price, as part of their employment benefits. As part owners, employees with stock gain a vested interest in the success of the company. Shareholders, which can include both individual and employee investors, vote for a board of directors, who then oversee the company's management. The board of directors is responsible for making major decisions and hiring top executives to manage the company on a daily basis. This structure is typical of a public company where there may be thousands or millions of shareholders. ESOPs can be seen as a way to align the interests of the employees with those of the shareholders, as they all have a stake in the company's performance.