Module Aims & Objectives

This module provides the essential background knowledge needed by anyone working in the field of employee share ownership schemes. It is concerned with why firms introduce schemes and the benefits likely to accrue to the various stakeholders.

Learning outcomes

On the successful completion of this module, the student should be able to:

1

Discuss with an employer the likely costs and benefits of introducing an ESO scheme;

2

Explain to an employee what happens when a business offers employees the opportunity to join an ESO scheme; and

3

Critically review the long run development of ESO schemes in the UK.

Synopsis of content

1

The market for shares, buying and selling, profits, prices and dividends. Shareholder rights and meetings.

2

Historical background to employee share schemes in the UK, with references to US (Russell Long and Kelso) and EU experience (the social model). Why a trust?

3

What schemes are available in the UK? Definitions and patterns of adoption of various employee share schemes.

4

CASE STUDIES of successful employee share schemes.

5

Other models - Employees as owners and financial stakeholders; producer co-operatives, Mondragon, partnerships.

6

Significance of approved and unapproved tax regimes to employee share schemes, political issues – such as SAYE and options expensing.

7

Business case for introducing an employee share scheme – productivity retention, incentives and rewards, corporate ‘glue’. The Place of employee share schemes in high performance companies.

8

Do they work? - statistics and summarised reports, discussion. Who benefits?

9

Shareholder value, creativity and innovation, meeting needs of customers and markets, investment in human capital, employee relations, community relations.

10

Financial education in the workplace – links between pensions and employee share schemes. Stakeholder communication issues – role of HRM and other departments (payroll, finance, marketing/public relations). Stakeholder communication issues – role of HRM and other departments (payroll, finance, marketing/public relations).