Employee Ownership: Implications for the Organizational Distribution of Power  - CLEO Skip to main content


Theorists and researchers in organizational behavior have a continuing interest in the distribution of power and control among members of work organizations. Of particular interest is the ownership-control relationship when workers without previous ownership rights gain substantial amounts of stock in the company in which they are employed. It can be hypothesized that the larger the number of shares an employee owns in the organization, the more he views himself as an owner of the firm. In addition, the more capital a worker has invested, the more he should view himself as a partner with management in the enterprise. Further, he will want to exercise more control over decision making without losing the power he previously had over other issues. It can also be asserted that members of the nonmanagerial unionized white-collar workforce in employee-owned firms will not want a distribution of control in decision making in which employees participate as a group to a system of control based on collective bargaining, but unionized blue-collar workers will prefer union control over employee participation external to collective bargaining. Workers’ and managers’ views of their roles as employee owners, financial partners, and co-decision makers were examined in a furniture factory bought by its employees through a corporate divestiture. Worker owners generally viewed management as the true owners of the firm, did not perceive themselves as partners, and preferred to favor management over power equalization.

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