As a qualified retirement plan (QRP) under Section 401(a) of the Internal Revenue Code, an employee stock ownership plan (ESOP) is required to have a trustee. The trustee of any QRP is not legally required to be independent, but it is highly recommended they be so for any ESOP transaction (e.g., purchase of company stock, sale of company stock to a third party, etc.) or if they plan on being an ongoing trustee. Independent or not, a trustee’s duties are the same. And as a fiduciary, they are required to act solely in the best interests of the participants and their beneficiaries.

Let’s learn more about the role of the Employee Stock Ownership Plan Trustee.