Race and gender wealth equity and the role of employee share ownership

Abstract

Purpose

The paper discusses the relationship between systemic inequity and wealth disparity and advocates for expanding employee share ownership as a strategy to address divides in income and wealth by race and gender. It targets diverse actors including policymakers, philanthropic leaders and social investors and presents a set of policy proposals and practice ideas that seek to advance a broader understanding of employee share ownership and build the capacity of key organizations to support employee-owned businesses.

Design/methodology/approach

This paper draws on data indicating positive outcomes from employee share ownership programs (ESOPs) related to job quality, economic stability and wealth-building, as well as widespread political support for ESOPs.

Findings

This paper suggests that employee share ownership can help to strengthen job quality and address race and gender income and wealth gaps. It argues that there is both public support and a range of different strategies actors can implement to expand awareness and access to different forms of employee share ownership.

Research limitations/implications

Additional research focused on other forms of employee share ownership (beyond ESOPs) is needed to deepen understanding of how each form can play a role in addressing racial and gender wealth inequities. The paper acknowledges that despite the potential of employee share ownership to mitigate racial and gender wealth gaps, additional simultaneous strategies are required to address the range of systemic barriers that have disproportionately limited women and people of color's participation in ESOPs.

Practical implications

Policymakers are actively seeking new proposals, while philanthropic leaders, social investors and others are also eager to build awareness and understanding of employee ownership models and develop the institutional capacity necessary to support strong employee-owned businesses. This paper directly responds to these needs and contributes to a broader collaborative effort to spread employee share ownership policies and practices that support economic recovery and lay the foundation for a more equitable and resilient economy.

Social implications

Employee share ownership is not yet a strategy that is well understood among policymakers and the public, but it connects to and supports outcomes that are top of mind for many, including increasing local ownership and bolstering local economies, helping small business owners retire in ways that preserve local jobs and businesses, strengthening job quality and workforce development, addressing racial inequity and economic inequality and providing workers greater voice and agency. This paper seeks to connect employee ownership to these high-priority issues and support efforts by a range of organizations to implement policy and practice solutions.

Originality/value

This paper fulfills an identified need to aggregate recent research on the relationship between employee share ownership and wealth inequities on the basis of race and gender. It also offers a timely argument that employee ownership strategies can play an important role in responding to the challenges facing communities and workers – particularly women workers and workers of color – as we rebuild from the COVID-19 pandemic.

Citation

Weissbourd, J., Conway, M., Klein, J., Chang, Y., Kruse, D., Hoover, M., Leverette, T., McKinley, J. and Trenholm, Z. (2021), "Race and gender wealth equity and the role of employee share ownership", Journal of Participation and Employee Ownership, Vol. 4 No. 2, pp. 116-135. https://doi.org/10.1108/JPEO-08-2021-0008