Employee share ownership and performance: golden path or golden handcuffs?

Sengupta, Sukanya; Whitfield, Keith; McNabb, Bob

doi:10.1080/09585190701502620

Cited by 81 publications

(84 citation statements)

References 65 publications

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“…Other papers have found employee share ownership has effects which are conducive to training, such as lower labour turnover (Fakhfakh, 2004;Sengupta et al, 2007). By and large, this research has assumed that there is a sequential and temporal dimension to complementarity between training investments and employee share ownership plans but this has not been well developed in the work published to date.…”

Section: Introductionmentioning

confidence: 93%

Do investments in human capital lead to employee share ownership? Evidence from French establishments

Guery

Pendleton

2016

Economic and Industrial Democracy

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Investments in human capital can create a hold-up problem whereby both employers and employees exploit the bargaining weaknesses of the other. Employee share ownership (ESO) can mitigate this hold-up problem because it can align interests, develop loyalty, signal good-will and lock in employees. Previous studies have shown positive relationships between company investments in human capital and the use of ESO consistent with this argument but have been unable to identify the direction of causality. Using panel data from the French REPONSE survey, the findings indicate that significant and continuous investments in human capital take place prior to the implementation of ESO.

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Section: Introductionmentioning

confidence: 93%

Do investments in human capital lead to employee share ownership? Evidence from French establishments

Guery

Pendleton

2016

Economic and Industrial Democracy

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“…Even though there is much debate about the precise mechanisms through which these schemes impact on performance, there is strong theoretical support and empirical evidence to suggest that ESO schemes are associated with higher labor productivity (Freeman, Blasi & Kruse, 2010; Kim & Ouimet, 2014; Park & Song, 1995) and performance in organizations (Bryson & Freeman ; Blasi, Freeman, Mackin, & Kruse, 2010; Fernie & Metcalf, ; Kruse et al, 2010b; Long, ; McNabb & Whitfield, ; O’ Boyle et al, 2016; Pendleton, ; Sengupta, ; Sengupta et al, ). In a meta‐analysis of 27 studies, Kruse and Blasi (1995, p. 26, in O'Boyle et al, ) concluded that studies on employee ownership and firm productivity or profitability frequently “indicate better or unchanged performance.” A more recent meta‐analysis of 102 studies representing 56,984 firms from around the world found that employee ownership had a small but a positive and statistically significant relationship with firm performance (O'Boyle et al, ).…”

Section: Theory and Hypothesesmentioning

confidence: 99%

Moderating effect of pay dispersion on the relationship between employee share ownership and labor productivity

Sengupta

Yoon

2018

Human Resource Management

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The moderating effect of pay dispersion on the relationship between employee share ownership (ESO) and labor productivity is examined in an unbalanced panel sample of 533 organizations (1,156 organization‐year data points) in Korea. Pay differential between job levels (vertical pay dispersion) is theorized to negatively moderate the ESO–productivity relationship. On the other hand, pay differential within a job level (horizontal pay dispersion) is theorized to positively moderate the ESO–productivity relationship. These predictions are partially supported. Consistent with the prediction, vertical pay dispersion negatively moderates the ESO–productivity relationship in that the relationship is more negative when vertical pay dispersion is high. However, we found no support for the moderating effect of horizontal pay dispersion in this relationship. The results challenge the simplistic view that pay dispersion per se can be detrimental to the ESO–productivity relationship.

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“…Bayo‐Moriones and Larraza‐Kintana () found that ownership increased commitment when other participation opportunities were limited, but commitment decreased when employees were able to participate in other ways. Sengupta et al () found that while ownership does not improve commitment, it appears to bolster performance by lowering turnover.…”

Section: Ownership Effectiveness: An Overviewmentioning

confidence: 99%

What does employee ownership effectiveness look like? The case of a Canadian‐based firm

2016

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Drawing on agency theory, we explore how 30 employees defined ownership effectiveness in a 100 % employeeowned Canadian-based firm. Using a qualitative case-study, remarkable similarities were found in the factors employees themselves believed contributed most to ownership effectiveness. Despite differences in job roles, employees emphasized confidence in the ownership program, participative decisionmaking, ownership identity, and their organization as a family unit. In light of these findings, we discuss how a broader conceptualization of employee ownership effectiveness can be applied for a more comprehensive understanding of how such programs may develop and manifest. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.Keywords: employee ownership effectiveness, qualitative case-study, agency theory Résumé Dans cet article, nous utilisons la théorie de l'agence pour examiner comment 30 employés définissent l'effectivité de la propriété dans une firme canadienne dont la totalité des actions est détenue par les employés. L'analyse qualitative des cas révèle des similarités remarquables dans les facteurs auxquels les employés eux-mêmes attribuent l'effectivité de la propriété. Quels que soient leurs rôles professionnels, ils évoquent la confiance dans le programme d'appropriation, la participation aux décisions, l'identité de la propriété et l'organisation de l'entreprise en forme de cellule familiale. Nos résultats nous permettent d'examiner comment on peut appliquer une conceptualisation plus large de l'effectivité de la propriété par les employés pour mieux cerner le mode de création et de fonctionnement des programmes d'appropriation.

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Employee share ownership and performance: golden path or golden handcuffs?

Cited by 81 publications

References 65 publications

Do investments in human capital lead to employee share ownership? Evidence from French establishments

Do investments in human capital lead to employee share ownership? Evidence from French establishments

Moderating effect of pay dispersion on the relationship between employee share ownership and labor productivity

What does employee ownership effectiveness look like? The case of a Canadian‐based firm

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