Employee participation through share holding

Employee participation can be exercised at a number of different levels. For instance, worker representation on supervisory boards provides the means of workers influencing the top direction and policy‐forming arrangements with a company. On the other hand, works councils form a mechanism through which workers influence those day‐to‐day management decisions which affect conditions at the workplace. There is also a wide choice of ways in which employees may participate in the joint decision‐making process at each of these different levels. Of late, the public discussion has tended to assume — quite wrongly, as it happens — that employee participation can come about only through legally‐required institutions such as two‐tier management or works councils. Two‐tier management after the German model gives the worker the means of influencing ‘board decisions’ as of legal right. But, theoretically, it has always been possible for a group of workers to secure a significant voice at board level by the simple process of acquiring a sufficiently large proportion of the voting shares of the company. It is, of course, necessary, in this context, to be careful to include the word theoretically, because the practical problem of where they are to get the cash from, with which to buy the shares, is of over‐riding importance. But it is worth making the point that it is not necessary to make changes in the law to bring about this form of employee participation in the decision‐making process. Provided employees can be helped over the hurdle of acquiring a significant joint holding, there is available in this approach, a form of participation which stems from employees having the feeling that they have a real stake in the business as part‐owners. How effective is this form of joint‐ownership in influencing attitudes at work? What conditions have to be met to make joint‐ownership an effective motivator?