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Overcoming barriers of employee ownership in France, Italy, Spain, the UK and the US

Niels Mygind (Department of International Economics, Government and Business, Copenhagen Business School, Copenhagen, Denmark)

Journal of Participation and Employee Ownership

ISSN: 2514-7641

Article publication date: 17 October 2023

Issue publication date: 21 November 2023

197

Abstract

Purpose

The purpose of this paper is to give an updated overview over the development of employee-ownership in Italy, France, Spain including Mondragon, the UK and the US with relatively many employee-owned firms. How have the barriers for employee-ownership been overcome in these countries?

Design/methodology/approach

The overview is based on updated descriptions of the development of employee-ownership included in this special issue. The analysis follows the structure of overcoming five barriers: the organization problem; the problem of entry and exit of employee-owners; the startup and takeover problem; the capital- and the risk problem.

Findings

Italy, France and Spain have overcome the barriers by specific legislation for worker cooperatives, this includes rules for entry and exit of employee members. Cooperative support organizations play an important role for monitoring and managing the startup problem and for access to capital. The Mondragon model includes individual ownership elements and a group structure of cooperatives. The EOT and ESOP models are well suited for employee takeovers, financing are eased by tax advantages and they are all-employee schemes. While the EOT has no individual risks, the ESOP model has the possibility for capital gains for employees but also the risk of losing these gains.

Originality/value

Comprehensive and updated overview of the development in employee-ownership in the five countries to identify successful formats of employee-ownership for implementation in countries with few employee-owned firms.

Keywords

Acknowledgements

The first version of this article was developed in relation to a project on Democratic Enterprises financed by the Danish Government.

Citation

Mygind, N. (2023), "Overcoming barriers of employee ownership in France, Italy, Spain, the UK and the US", Journal of Participation and Employee Ownership, Vol. 6 No. 3, pp. 230-263. https://doi.org/10.1108/JPEO-10-2022-0026

Publisher

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Emerald Publishing Limited

Copyright © 2023, Emerald Publishing Limited

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