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BDO USA Stewards Transformative Next Chapter With ESOP
Purpose-driven strategy gives participating U.S. employees shared stake in firm’s success.
CHICAGO, AUGUST 2023 − BDO USA, one of the nation’s leading accounting and advisory firms, today announced its intention to establish an Employee Stock Ownership Plan (ESOP), providing a broad base of our employees the benefit of ownership and a new model for the firm’s continued investment, growth, and long-term sustainability. When effective, BDO would be the first large public accounting firm to implement an ESOP. With more than 10,000 participating employees, BDO would be among the largest ESOPs in the country.
“An ESOP is the realization of our purpose of helping people thrive, every day. It is a game-changer for our people, clients and communities, designed to improve lives for generations to come,” said Wayne Berson, CEO of BDO USA. “Amid the changing landscape of our profession, the ESOP unlocks the value of our firm today and embodies our strategy to sustain a strong, caring and resilient business for tomorrow. We are proud to establish this ESOP to invest in each other so everyone who contributes to our success has the opportunity to benefit from it.”
“Today’s talented professionals have many options in choosing where to start and build their careers,” shared BDO USA Chief People Officer Cathy Moy. “BDO has long been distinguished by a culture which puts people first with a commitment to thriving together. The ESOP will be unique and innovative in our profession and supports our goal to be an employer of choice.”
An ESOP is a qualified retirement plan established as a trust, where current and future employees receive beneficial ownership in the company over time. Through the allocation of company stock, participating BDO USA professionals will be able to access a retirement plan that requires no out-of-pocket contribution, helping them plan for their future financial well-being.
“The ESOP also has material benefit to the firm,” notes Steve Ferrara, Chief Operating Officer of BDO USA. “It allows for continued investment in quality, as well as operations and growth strategies, while maintaining continuity in leadership and commitment to a longstanding vision and purpose.”
Establishing BDO’s ESOP involved some of the leading ESOP advisors in the country. Stout, a global investment bank and advisory firm, acted as exclusive financial advisor and debt placement agent on the transaction. Global law firm, McDermott Will & Emery provided legal counsel. In addition, BDO has engaged an experienced, independent Trustee to represent the interests of ESOP participants. The debt financing to support the transaction was arranged by Apollo Capital Solutions and will be anchored by certain funds managed by affiliates of Apollo (NYSE: APO). The ESOP and related transactions are expected to become effective August 31, 2023. In conjunction with the effective date, BDO USA’s fiscal year end will change to December 31. Terms of the transaction are undisclosed.
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ESOP Fundamentals
- An ESOP is a qualified retirement plan that provides all participating employees with an ownership stake in a company.
- In 1974, Congress created the legal framework to encourage ESOPs because its members believed ESOPs would create a broader distribution of wealth.
- Congress also expected ESOPs to improve company performance and to provide a way for owners of closely held companies to preserve their business legacy.
Today’s talented professionals have many options in choosing where to start and build their careers. BDO has long been distinguished by a culture which puts people first with a commitment to thriving together. The ESOP is unique and innovative in our profession and supports our goal to be an employer of choice.
Cathy Moy
Chief People Officer
Building a new model for our firm of the future.
The ESOP reflects the realization of our core purpose and commitment to helping people thrive, every day. Benefits include:
- Bringing shared success to all participating employees
- Providing access to a retirement plan that requires no employee out-of-pocket contribution, helping our people plan for their future financial well-being
- Helping to fuel continued investment in quality, as well as operations and growth strategies
- Positively positioning us to recruit and retain talent
- Allowing us to preserve our 113-year-old history and culture
- Honoring our past and positioning us for the future
Read more about this transformational moment in BDO’s history
- Forbes
Mammoth Accounting ESOP Thrusts Professional Services Firms To Center Stage - The Wall Street Journal
BDO to Establish Employee Stock Ownership Plan as Part of U.S. Restructuring - Bloomberg Tax
BDO Launches Stock Plan Giving 10,000 Workers Part Ownership - Accounting Today
BDO to create ESOP with $1.3B credit deal - CPA Practice Advisor
What Accountants Had to Say About the CPA Firm Business Model—and Why it Needs to Evolve
Together, we thrive.
Everything we do is rooted in our core purpose to help people thrive every day. It’s not only the right business thing to do; it’s the right human thing to do. This starts by putting our people at the center of our work and extends to how we treat and value our people, our clients and our communities. With a dedication to quality and a purpose-driven culture, BDO offers a powerful choice both for clients and those seeking rewarding professional careers.