Can employee share-ownership improve employee attitudes and behaviour?

This source preferred by Dermot McCarthy

Authors: McCarthy, D., Reeves, E. and Turner, T.

http://eprints.bournemouth.ac.uk/20407/

Journal: Employee Relations

Volume: 32

Pages: 382-395

ISSN: 0142-5455

DOI: 10.1108/01425451011051604

Purpose: To examine the outcomes of a substantial broad-based employee share-ownership scheme for employee attitudes and behaviour in a privatised firm.

Methodology: Results are based on a survey of 711 employees in Eircom, an Irish telecommunications firm, which is 35 percent employee-owned.

Findings: The ESOP has created sizable financial returns and has had extensive influence in firm governance at the strategic level. However, findings show only a limited impact on employee attitudes and behaviour. This is attributed to a failure in creating a sense of employee participation and line of sight between employee performance and reward.

Originality: Little research has examined the impact of a large employee shareholding on attitudes and behaviour within a public-quoted firm. The substantial and unparalleled size of the Eircom ESOP presented a unique opportunity to conduct such a study.

Policy implications: The aim of employee share-ownership often includes aligning employee objectives with those of other shareholders, and thus improving labour performance. The findings in this study highlight a need to provide employees with a sense of ownership and control. Findings also question the assumption that where employees have a substantial shareholding, they will focus on securing the long-term prospects of the firm.

This data was imported from Scopus:

Authors: McCarthy, D., Reeves, E. and Turner, T.

http://eprints.bournemouth.ac.uk/20407/

Journal: Employee Relations

Volume: 32

Issue: 4

Pages: 382-395

ISSN: 0142-5455

DOI: 10.1108/01425451011051604

Purpose: The purpose of this article is to examine the outcomes of a substantial broad-based employee share-ownership scheme for employee attitudes and behaviour in a privatised firm. Design/methodology/approach: Results are based on a survey of 711 employees in Eircom, an Irish telecommunications firm, which is 35 percent employee-owned. Findings: The ESOP has created sizable financial returns and has had extensive influence in firm governance at the strategic level. However, findings show only a limited impact on employee attitudes and behaviour. This is attributed to a failure in creating a sense of employee participation and line of sight between employee performance and reward. Practical implications: The aim of employee share-ownership often includes aligning employee objectives with those of other shareholders, and thus improving labour performance. The findings in this study highlight a need to provide employees with a sense of ownership and control. Findings also question the assumption that where employees have a substantial shareholding, they will focus on securing the long-term prospects of the firm. Originality/value: Little research has examined the impact of a large employee shareholding on attitudes and behaviour within a public-quoted firm. The substantial and unparalleled size of the Eircom ESOP presented a unique opportunity to conduct such a study. © Emerald Group Publishing Limited.

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