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Stock-ownership plans based on organizational performance are an example of a(n)

A) Profit-sharing plan
B) Employee stock ownership plan (ESOP)
C) Bonus plan
D) Deferred compensation plan

1 Answer

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Final answer:

Stock-ownership plans based on organizational performance are an example of an Employee stock ownership plan (ESOP). ESOPs are retirement plans in which the employer contributes company stock to the employee's retirement account based on the company's performance.

Step-by-step explanation:

Stock-ownership plans based on organizational performance are an example of Employee stock ownership plan (ESOP).


ESOPs are retirement plans in which the employer contributes company stock to the employee's retirement account. The amount of stock allocated to each employee is based on the company's performance. As the company's performance improves, the value of the stock increases, providing a financial incentive for employees to work towards the company's success.


ESOPs are often used as a way to motivate employees, promote employee loyalty, and align their interests with the company's success. It gives employees a sense of ownership in the company and allows them to benefit directly from the company's profits.

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