In addition to its use to attract and hold key personnel, ESOPs can also:

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ESOPs can provide business owners with a way to sell their ownership stake in the company and cash out, either partially or completely, while still maintaining control over the business. This makes it a beneficial option for owners who want to retire or attain liquidity without selling to an outside party. A is incorrect because ESOPs do not give employees veto power over management decisions. B is also incorrect because ESOPs do not give employees a share of liability. D is incorrect because ESOPs provide an incentive for managers to improve the company's financial performance, but not at the expense of labour costs.

In Addition to Its Use to Attract and Hold Key