A recent article in Wired described employee ownership as one of the U.S. economy’s “best kept secrets.” Typically, these arrangements are done through Employee Stock Ownership Plans (ESOP), a retirement plan that allows employees to own part or all of their company. Employees participating in ESOPs , owning a piece of the pie, make a stronger connection between their day-to-day activities and their impact on the broader company. Susi Mudget, former president and CEO of Chemonics and now their Chair of the Board, is quoted in the article describing how their ESOP helps with recruitment and retention.
One of the challenges of employee ownership is extending the benefit to non-U.S. employees. Chemonics and Black & Veatch are two cases in a study conducted by Rutgers University’s Institute for the Study of Employee Ownership and Profit Sharing that identified the benefits of employee ownership, including enhanced employee engagement and productivity, recruitment and retention, and corporate reputation. One of the keys was active efforts to strengthen an ownership culture or mindset. There are multiple legal, regulatory and cultural challenges of global ownership – tax, labor and stock ownership laws, varying wage scales and different understandings of retirement and stock ownership. Nonetheless, many firms in the development sector are employee-owned, including DAI, Abt, Panagora, Mott MacDonald, in addition to Chemonics and Black & Veatch mentioned above.
Read the Wired article here.
