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Employee share ownership in
times of pandemic
ALL
REACTIONS AND SUPPORTS
Izaskun Bilbao Barandica, Member of
the European Parliament, Renew Europe, Spain - Gracias
por su correo, les adjunto
algunas de las noticias relativas a la participación
de los empleados en las empresas que se han puesto
en marcha
en Euskadi por si fuera de su interés. En el año
2018 el Parlamento Vasco aprobó una iniciativa con
el acuerdo de todos
los
grupos para avanzar en este modelo.
Jan
Pravda, Czech Republic - I am a fund manager and
investor, and agree 100% that this is a good opportunity
to implement this long missing feature of capital
structure.
Jorgen
Pedersen, Vice President Compensation & Benefits
and International Mobility, Saint-Gobain, France
Juan
Manuel Sinde, President of Arizmendiarrieta Foundation,
Spain - Thank you very much, it is a very interesting
initiative!
Jean-Marie
Peretti, Professeur ESSEC Business School, France
Better
Finance, the European Federation of Investors and
Financial Services Users urges to put Employee Share
Ownership
at the core of efforts to tackle the Corona-induced
financial crisis - Press
Release
Heinrich
Beyer, Bundesverband Mitarbeiterbeteiligung – AGP,
Germany - Thank
you for your initiative to promote employee
share ownership in Europe. Of course we also support
your proposal - "An employee share ownership fund
to help companies
tackle the crisis". We also approached the German
federal government with the proposal to better promote
employee
participation as "emergency aid" in the corona-crisis.
And thank you for the concept paper "A generic European
ESOP model".
This is also very interesting for the discussion
in Germany, although we hardly have the entrepreneurial,
political and legal
requirements. But we will continue to take care
of the topic.
Gabriela
Cretu, MP, European Affairs Committee Chairperson,
Romanian Senate, Social Democratic Party, Romania
I support the proposal !
Cibrán
Fernandez Silva, Cabinet of the President of the
European Council Charles Michel - Many thanks for
the input.
We will take it into consideration.
Corey
Rosen, Founder of the National Center for Employee
Ownership, USA - I think this is a very well-done
paper, and I agree
with most of it. I would agree with others that
it is not really a key issue to have employees vote
the shares or
elect
the trustee. Many business owners will not be comfortable
with allowing that, so you will have far fewer ESOPs.
The research on this issue is clear-voting rights
do not significantly change how employees feel about
being owners and
in
companies that do have voting rights, the rights
don't lead to much change anyway (I was on the board
of one and each year
we
all got nominated by ourselves and reelected without
opposition). Voting rights are not at all correlated
with company
performance. What is correlated (highly) is work-level
decisions (teams, ad hoc groups, open book management,
etc.), but it is
not possible to legislate that-it has to grow organically
in the employee ownership community, as it has here.
David
Binns, ESOP Services, USA - In my opinion, this
updated draft is a dramatic improvement on the prior
version.
It
does a much better job of explaining the basic structure
and dynamic of the US ESOP while offering possible
innovations
for its adoption in the European context. While
I would still quibble with some of the assumptions
(the one-person, one-vote
concept is problematic in my view), it's an excellent
basis for stimulating discussion of the potential
for incorporating
the principles of the ESOP for restructuring European
SMEs.
Michael
Keeling, Past President of the Employee Ownership
Foundation, USA - I think your goal of moving forward
to expand
broad
based ownership among EU members is more important
than the details of any proposal as some of my good
friends
in the U.S. sent to you in responding to your
proposal. I want you to succeed.
Hugh
Donnelly, Director Co-operative Education Trust
Scotland, UK - I would not claim to have fully digested
the entire paper
but the use of a co-op vehicle is certainly one
which would have appeal in Scotland and the UK.
At both levels, discussions
are
developing on new forms of economic organisations
and the point made by Kris below that it might not
appeal to banks,
equity
or VC operations would be an added attraction for
many who want to see a new form of organisation
after this pandemic,
new
ways of organising society and new ways of financing.
Kris seems to assume that nothing will change in
the world of
venture
capitalism and, unfortunately having seen how things
didn't progress after the financial crash of 2008,
he may well
be
correct. I think there will be an even greater demand
this time round as to how we organise economic,
social and cultural
activity
and certainly more employee ownership has to be
to the fore in that discussion and the co-op option
suggested
in
your paper opens up another genuinely democratic
way to achieve the same.
Kris
Ludwiniak, President, Forum for Employee Share Ownership
Develoment, Poland - In
our legislation proposals for
employee ownership programs, we are recommending
three options of capital formation for developing
employee ownership.
Two of those are internal and similar to ESPP and
the third one is based on credit financing from
banks or other financial
institutions.
It is very similar to ESOP financing, if not identical.
Of course, combination of all three is possible.
In our proposals employees and companies have flexibility
in deciding which formula of employee ownership
financing is
the best for them. Moreover, in our legislative
proposals are specific regulations that are protecting
broad share ownership
as well as paragraphs that prevent concentration
of capital. As far as COOP - ESOP idea, I think
this is complicated approach
to capital formation and can create unnecessary
managerial problems. The COOP concept is not very
adaptable to mix with
idea of corporation. It is also marginally popular
in industrial sector of economy. I suspect banks
and especially private
equity and venture capital firms will have limited
interest in financing COOPs as a vehicle that suppose
to build employee
ownership in corporations.. Consequently it would
not rise too much of interest especially among start-ups
and SMS
companies. In my opinion the foundations similar
to those functioning in Austria or perhaps modernized
labor unions
at company levels (like in Gazolina) are better
options for acting as a trust institutions then
COOPs.
Jean-Philippe
Debas, President, Equalis Capital, France - Thank
you very much for sharing this very interesting
work.
As
you may imagine, I totally support the propositions
that are outlined in the document as they resonate
both with my beliefs
and
the inner workings of SMEs. I have only one suggestion
to offer : maybe the authors should consider the
Fonds Commun
de
Placement d'Entreprise (FCPE) as a candidate for
the Generic ESOP. It is the dominant vehicle for
employee ownership
in
Europe both for listed and privately-held companies.
As an alternative investment fund it is already
regulated under
a European
Directive (the Alternative Investment Fund Managers
- AIFM - Directive). At Equalis Capital we have
set-up many
FCPEs
on a pan-European level and it did work seamlessly.
I am slightly surprised that the FCPE is not even
mentioned
in the
Position Paper. Us Europeans should perhaps leverage
our own know-how rather than necessarily looking
up to the US
for solutions.
Tej
Gonza, President, Institute for Economic Democracy,
Slovenia - Governments should seriously consider
structuring
government aid so that it translates into sustainable
and inclusive employee ownership in the receiving
companies.
Here
is our appeal to Slovenian Government
Fred
Freundlich, Profesor, Area de Personas en Cooperación
y Ownership, Mondragon Unibertsitatea - Many thanks,
Marc.
Best
of luck with this proposal. I enthusiastically agree
that an ESOP-like mechanism is crucial for Europe,
especially for
the thousands
of SMEs who are or will soon be facing retiring
owner/ownership succession situations. If memory
serves,
more
than half of American ESOPs were born under these
circumstances. I think the tax benefits do not have
to be as
generous
as they are in the US for retiring owners (full
deferral of capital gains taxes); they just have
to be substantial enough
to get
retiring owners (and their lawyers' and accountants')
attention and substantial enough to make it more
beneficial
than
a conventional exit strategy: selling to a competitor
or liquidating or whatever. The ESOP certainly has
had its problems
and challenges,
but the basic idea, especially the idea behind the
LEVERAGE ESOP, is brilliant: it allows ordinary
working
people
to, in effect, use the assets of the owner's company
to guarantee a loan that permits them to buy a substantial
%
of the
company, a loan that they would almost certainly
not be able to obtain by themselves (they just do
not have enough assets,
income
or credit history) and THEN it allows these same
ordinary employees to use the company's capacity
to generate revenue
to repay
the loan. Of course the owner benefits greatly too,
so it is a giant WIN-WIN. And if the ESOP saves
the company from
being
liquidated or sold to another party (usually a party
not concerned about local employment) then the local
government
and local
economy also WIN. I'm sure you know all this already,
but it deserves emphasis. I'm glad Tej and David
and other
experts
are also involved. They have a lot of experience
and have given this much thought. Best of luck again.
I hope
Europe responds. You surely have all my support.
Frédéric
Huignard, CEO, Sowise, France - Le Covid19 nous
ouvre une opportunité de soutien aux entreprises
qui accélère
notre roadmap. Nous avons nous-mêmes envoyé une
note au Ministère des Fianances français. Nous allons
faire suivre
la vôtre qui va exactement dans le même sens.
Employee
Shareholders Association of ING, Belgium
Christophe
Quintard, Président, AASR (Association des Actionnaires
Salariés Renault), France
Eero
Kokko, Owner, Optimal Training Oy, Finland
Vytenis
Andriukaitis, Deputy Chairman of the Parliament
of the Republic of Lithuania and Chairman of the
Committee
on
European Affairs, Lithuania - I am just supporting
this appeal.
José
Remus, Professor, Universidad Autonoma de la Ciudad
de Mexico (UACM), Mexico.
Centro
Studi Sociali Pietro Desiderato, Federazione Autonoma
Bancari Italiani (FABI), Italia
L'azionariato dei dipendenti in tempi di pandemia.
La
EFES rivolge un appello a tutti i Governi ed
Istituzioni europee affinchè
la leva fiscale e le politiche pubbliche non ostacolino,
ma promuovano ed agevolino l'azionariato e la partecipazione
dei dipendenti.
Christopher
Mackin, Ownership Associates, USA - Congratulations
on taking this initiative. Now is a time where it
should be clear
to
all regardless of ideology that no working person
should have to rely upon wages alone. It is time
for broad-based share
ownership.
We are pursuing similar initiatives in the United
States, see why
the coronavirus crisis is an opportunity to
reshape
the relationship
between workers and their employers.
KSLP
- Ceská spolecnost pro zamestnaneckou participaci,
z.s. tuto Výzvu signovala.
Arnaud
Cagnard, France
Maurice
Hadet, France
Nicolas
Aubert, Professeur des Universités, Directeur du
CERGAM, IAE Aix-Marseille, France - C'est une super
initiative!
Eric
Lafon, LCL, France
Bertrand
de Cugnac, Président, LCLAS, France - Je signe l'appel
en cette période de crise à promouvoir le développement
de l'actionnariat salarié et la reprise d'entreprises
par les salariés.
Tej
Gonza, President, Institute for Economic Democracy,
Slovenia - Full-hearted support to the initiative.
Governments should
seriously consider structuring government aid so
that it translates into sustainable and inclusive
employee ownership in
the receiving companies. At our institute we have
already appealed to the gov crisis group about this
issue.
Here
is a recent op-ed dealing with the proposal in a
general way.
David
Ellerman, Visiting scholar at the University of
California/Riverside and at the University of Ljubljana,
Slovenia - We are
thinking along the same lines about building some
EO into COVID-19 Govt aid. See
this preprint of our paper coming out
in a journal Intereconomics.
Fred
Freundlich, Profesor, Area de Personas en Cooperación
y Ownership, Mondragon Unibertsitatea - I forwarded
your
message
to some contacts, various of whom I know are working
ideas similar to the ones in the "Appeal...". In
the message
below,
is a
link to a pre-print of a new paper "COVID-19:
Government Aid that also promotes Employee Ownership"
by
David
Ellerman and Tej Gonza from Slovenia.
Ioan
Lucian, President, National Union of Romanian Employers
- We sign, and will be together with you on your
special initiative.
Andrej
Mertelj, CEO, Datalab Slovenia - We're a middle
aged (23 y.o.) software company from Slovenia. Roughly
200 people
with
all our subsidiaries. We're encouraging employee
share ownership since 2003 when we distributed first
shares among
employees.
We listed on Ljubljana stock Exchange in 2008 and
started a formal ESOP/MSOP program in 2010
It is
sometimes hard to convince employees about the value
and we're hindrered by the taxation policy in Slovenia
severely
limiting
the shares under ESOP program. We agree strongly
with your appeal!
Thanks
for your initiatives and Good luck to everybody,
Jean-Pierre
Paelinck, Secretary General, World Federation of
Investors - Encouraging employee ownership is an
excellent
opportunity
to provide the much needed capital that businesses
need at this time. In addition, it creates an environment
where
workers
can closely appreciate the risk-reward of investing.
There are many very successful employee ownership
examples
in
the US.
Xavier
Fontanet, HEC Paris, France - Voir
mon blog Et si nous repensions le contrat
de travail? ...Sans compter qu'il y a là
une des solutions au problème de la retraite dans
le cas d’une rémunération sous forme d’actions,
puisque le collaborateur
se constitue au fil des ans un capital qui permet
de l’augmenter dans des proportions considérables,
comme le démontrent
les entreprises qui ont pratiqué l’actionnariat
salarié depuis longtemps.
Aldo
Sicurani, Délégué général, Fédération des Investisseurs
individuels et des Clubs d'investissement (F2iC),
France
Je
signe cet appel bien volontiers. Nous allons l'intégrer
dans notre webzine.
Georges-Louis
Bouchez, Président, Mouvement Réformateur,
Belgium - Je vous remercie pour l'appel de votre
fédération que j'ai
bien
reçu. Celui-ci a retenu toute mon attention et fera
l'objet d'un examen approfondi dans le cadre des
mesures de relance qui
seront évaluées par l'ERMG et le gouvernement. Merci
encore pour cette proposition et ces informations.
Myriam
Biot, Cultures Plurielles, Belgium - L'actionnariat
salarié est un outil pour sortir de la crise
actuelle. Ne passons pas à côté.
László
Miskéri, Waterworks Trade Union, Hungary
Association
des Actionnaires Salariés d'ING, Belgium
David
Faber, OGBL, Luxembourg
Jérôme
Touchard, BNP Paribas, France
Vic
Thorpe, Just Solutions Network, UK - As you rightly
indicate, this is a major opportunity to increase
the impact of ESOP and
cooperative structures to build on social solidarity
and to counter the destructive nature of greed-based
capitalism.
Alexander
Remesch, Parlament, Republik Österreich
BETTER
FINANCE - European Federation of Investors and Financial
Services Users
Fédération
Européenne des Épargnants et Usagers des Services
Financiers
Walter
Vogt, IG Metall, Germany
Brigitte
De Wolf-Cambier, Rédactrice en chef EH21, Repenser
l'entreprise autour de l'homme, Belgium
Jorgen
Pedersen, Saint-Gobain, France
Xavier
Collot, Amundi, France
Stefan
Fritz, mit-unternehmer.com, Germany
Heinrich
Beyer, Bundesverband Mitarbeiterbeteiligung – AGP,
Germany - Call
for support to German initiative
ALSO TO HIGHLIGHT
Michel
Bon, Président de Fondact, France - La cause
de Fondact est d'encourager la réussite collective,
au-delà de la
performance individuelle. La lutte contre le Coronavirus
fait appel au même ressort. C'est le comportement
efficace de
tous (ici, le confinement) qui, seul, nous fera
gagner le combat ; et c'est le jeu personnel qui
nous le fera perdre.
Mettons à profit l'évidence actuelle de cette idée
pour l'utiliser massivement au sortir de la crise.
En particulier, vous
avez sûrement noté que la "prime Macron" peut aller
jusqu'à 2000 € dans le cadre d'un accord existant
ou conclu
avant le 31 août. Et que la loi Pacte permet un
abondement unilatéral allant jusqu'à un peu plus
de 800 € pour ouvrir
à tous l'actionnariat salarié.
Daily
Mail and General Trust, UK - DMGT, parent organisation
of DMG Media offers 2,400 employees shares
to avoid pay cuts. More
NOT
INTERESTED
Martin
Kamp, Member of the European Parliament, European
People's Party, Germany
Norbert
Lins, Member of the European Parliament, European
People's Party, Germany
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