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Joseph R. BlasiĀ 

by: Blasi, Joseph

J. Robert Beyster Professor of Employee Ownership
School of Management and Labor Relations
Rutgers University
New Brunswick, New Jersey

Employee stockownership for many years was relegated to quaint discussions of worker cooperatives or a 300 worker ESOPs, Today, all of that has changed. Many executives at major corporations across the spectrum have decided to use meaningful broad-based employee stock ownership in a variety of new and creative forms in order to align the interests of employees with those of shareholders. A large number of the 100 Best Companies to Work For in America have some form of employee equity. The major technology firms that are driving innovation, Google, Facebook, Twitter, as well as historic contributors to innovation such as Cisco, Microsoft and others are strongly committed to employee equity. Many of the firms with whom Americans come into contact on a daily basis use broad-based employee ownership and various forms of shared capitalism. Just to go down the Fortune 500, the second and third largest companies like Exxon Mobil and Chevron have had a long history of broad-based employee ownership plans although it is not trumpeted. Procter & Gamble was one of the first major U.S. corporations to try cash profit sharing and broad-based employee ownership in the late 1880's and these have remained central to the firm's culture ever since. The restructured General Motors -- whatever one thinks about the bailout -- now has broad-based stock options and cash profit sharing. Microsoft has a long-standing history of broad-based stock options from its founding and now has broad-based restricted stock plans. Most of the firm's equity plans to employees way below the top five executives. United Parcel Service has a unique plan of employee ownership. Goldman Sachs group has significant staff ownership. Intel has had broad-based employee stock ownership for most of its history and is a firm deeply committed to the concept, as is Cisco Systems and Morgan Stanley.

I use the materials in CLEO to make students familiar with what is now a spectrum of approaches to employee ownership large publicly-traded companies such as these, medium size privately-held companies, start-ups, signal tech firms, and worker coops. I particularly find the cases on Southwest Airlines, Starbucks, and Microsoft useful. For smaller closely-held companies, the excellent cases by Professor Frank Shipper are really very well done. I also like to recommend the case of Namaste Solar, Reflexite, King Arthur Flour, and SRC Holdings. Sometimes in my classes I like short 5-10 minute cases and the capsule 'case-lets' of the National Center for Employee Ownership and 'mini-cases' from the British Employee Ownership Association and the Beyster Institute are quite useful for this.

The videos are of particular high quality such as Michael Keeling's discussion of the future of these issues, Dr. Corey Rosen's discussion on how employee ownership works and the Beyster Institute's videos with a range of scholars.

For the more serious student, CLEO is very special since it has a quite extensive of serious research papers on the subject so that it is possible to start with a case and move into some empirical research. A great overview of empirical research is Employee Share Plans: A Review by Dutch scholar Dr. Eric Kaarsemaker and his colleagues. Professor Steven Freeman of the University Pennsylvania has a detailed analysis of Federal policy for S corporation ESOPs.

Recently, I added a policy paper that I wrote with my colleagues Richard Freeman of Harvard and Douglas Kruse of Rutgers called Inclusive Capitalism for the American Workforce. This is a Center for American Progress Policy Paper that was written to be accessible to students and laypersons a like. It discusses Federal policy on tax deductions of narrowly based equity and profit sharing plans, how much that costs the U.S. Treasury and taxpayer in tax expenditures and whether research really substantiates and backs up such a tax expenditure on narrowly-based plans. We then suggest an alternative policy. I hope you will take a look at it. If all of us make regular contributions and suggestions for additions to CLEO it can continue to be what it is today, namely, the best accessible, useful source of materials for professors on this changing subject.

At Rutgers, in recognition of the increased interest across the spectrum of American business, with the leadership of the Foundation for Enterprise Development and the Employee Ownership Foundation and others we have established a Fellowship program for professors and pre-doctoral candidates who wish to pursue original research in the area. About 10-20 fellowships are offered each year. I am hoping that as professors use CLEO they will also consider if they wish to do some serious research in the area and apply for one of the fellowships. The entire program and all the fifty past fellows can be seen at:

This has been my area of research now for almost forty years. I will be delighted to help colleagues who are interested in research on the subject.

While I follow the field and have done so for many years, CLEO still surprises me with new, original, and cool cases, videos, and papers.

Thanks for being here.


Link: None
Publication Date: 2011-10-27
Pages: 0