Profit-sharing foundation - a way to engage and reward employees

A profit-sharing foundation is a separate legal person to which the employer, according to calculation bases adopted by the company, transfers profits when established targets and results are achieved.

The allocation is managed according to the investment decisions taken by the foundation's board of directors. The participants - employees or former employees of the employer - can then, within the framework of the rules of the foundation, request distribution from the foundation (for example, in the form of a pension contribution). Upon death, the shares accrue to the decedent’s estate or beneficiaries of the estate.

Unlike individual bonus and reward schemes, the allocation covers all or the majority of employees (pursuant to tax rules, at least one-third must be covered). This should create the conditions for greater employee engagement because they are given the opportunity to share in the profits they help create. 

PRI currently administers approximately one hundred profit-sharing foundations with approximately 175,000 individual participants. We are an independent administrator with a focus on administration, but we do not offer asset management services. The client is free to choose who it will use for asset management. 

This means that PRI handles all general administration, accounting, and communication with the participants, which preferably takes place via an on-line service with a banking login. Thus, we reduce the company’s workload and save time while providing board of directors’ support, as well as order and structure.

Our strengths include our wide-ranging expertise and long-term experience, combined with established routines. 

Feel free to contact us with your questions! 

PRI Pensions- och stiftelsetjänst
Phone +4631-778 30 40