EQ’s Shareholder Voice survey sample revealed that 50% of all shareholders in the U.K. and U.S. are aged between 18 and 40, and 18% are between 18 and 24 – the so-called Generation Z.
The oldest millennials were in their late 20s at the time of the 2008 recession. They saw their parents affected by the plummeting stock market or struggled themselves to find adequate employment while tackling student debt.
With that said, your company’s employee stock purchase plan (ESPP) could be a tool younger generations need to catapult them toward greater financial security. Furthermore, providing education about the importance of long-term investing, and how an ESPP fits into that puzzle, could have a positive impact to your company.
Bolster ESPP participation – start before day one
Don’t resort to simply sending an email before the enrollment period or just once a year to recruit participants, but create a meaningful campaign around it.
Communicate to employees year-round to increase ESPP participation. It’s especially important to take the time to educate employees who are new to either the workforce or your organization.
Some ideas to engage Millennials and Gen Z about your ESPP:
- Partner with a financial advisor to host webinars or lunch-and-learns on the importance of investing.
- Engage your ESPP provider to educate employees specifically on your unique offering and why it’s an important component of their benefit package.
- Feature Gen Z testimonials who are plan participants, sharing their experience with your stock plan.
- Create short tutorial videos covering a range of “Investing 101” topics, including explanations of your plan’s lookback provision, stock match, or purchase discount features.
Use ESPPs as an attractive recruiting and retention tool
Don’t assume that your ESPP offering, or long-term investing in general, is easy to understand or common practice.
It makes sense to take time to highlight how your employee stock plan is complementary to retirement savings. While they seem similar, ESPPs provide an additional savings option that can easily be liquidated down the road. Providing context around the long-term value of your ESPP could be the deciding factor for a recruit who’s weighing multiple employment opportunities.
ESPPs also offer an opportunity to engage with younger investors who follow stories and themes. Building narratives in digital channels can gain the engagement of these potential shareholders, especially by keeping them aware of things they care about, like environmental, social and governance (ESG) processes and results.
Make sure that your ESPP is presented alongside benefits like medical and dental insurance and 401k.
ESPPs increase employee engagement and retention
ESPPs can help retain top talent, turning employees into shareowners who have a vested interest in organizational performance.
Offering an ESPP demonstrates a company’s investment and pride in its employees. Make sure you’re spotlighting it to the generation that will benefit from the education you provide for the rest of their careers.