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Employee ownership is a proven answer to known problems; I saw it in my own research

In the 2024 Legislative Session, House Bill 24-1157 codified the  and established a new $1.5 million annual tax credit program to support Colorado businesses that are in their first seven years of employee ownership. Why? Because there is proven power and possibility in shared ownership.

Andrea Steffes-Tuttle

The impact of shared ownership is well-documented but often overlooked as a governance model.  show that companies where at least 30% of the shares are broadly owned by employees are more productive, grow faster, and are less likely to fail. Recent research by the  indicates that employee-owners have higher wages and net worth, receive better benefits and are less likely to lose jobs to cuts and outsourcing compared to workers without ownership stakes.

We are in a moment of serious inequality. Wealth is increasingly concentrated at the top, and businesses have an important role to play in distributing that wealth. However, governance models like employee ownership aren’t often taught in business-school curricula. As a result, business schools aren’t preparing future business leaders to address one of the primary crises of our time.

A job market in flux

In the wake of the COVID pandemic, there was a national reckoning about work. More than 4.4 million Americans voluntarily quit their jobs in September 2021 as part of “,” in response to poor labor conditions and burnout. For a moment, the power was in the hands of workers, and wages were rising, but that power has swung back to corporations. 

The rise in wages has been followed by economic strain, and droves of workers have been laid off, creating a crowded labor market. This forces workers to accept employment at reduced wages and in a weaker position. The insecure footing of today’s workers, combined with  is the source of significant stress and puts . The job market needs to be stabilized, but how?

A proven solution

Employee ownership is a proven answer to these issues. I saw it in my own research. I was drawn to my research by my experience as a worker and a business owner. When running a company, I felt trapped by the norms for managing and rewarding workers. It felt imbalanced that one person, the business owner, should receive almost all of the benefits of the work of others. 

Through my study, as part of my graduate work in the Department of Anthropology at the �鶹��Ƶ, I researched alternative ways of managing a business that might offer more equitable environments for workers. My research focused on B Corp-certified companies. B Corp certification is a designation that verifies that a for-profit company meets standards of social and environmental performance, accountability and transparency according to the certification requirements of the nonprofit B Lab. 

In interviews with 50 employees across 15 B Corps in the United States, I found that while the certification influences company policies and creates a community of companies that want to do good, it falls short of truly improving working conditions and worker equity.

Instead, the employees I encountered who were most satisfied and engaged worked at companies that had adopted shared ownership models of corporate governance. One of the companies in my study, Namaste Solar, operates as a worker cooperative. The employees at this firm were highly engaged, clearly communicated the organization's mission and purpose, and expressed high levels of job satisfaction. 

They participated in professional and team-development activities, and many acknowledged they could find higher-paying jobs elsewhere but preferred to stay at Namaste Solar. This engagement and satisfaction were largely attributed to the ownership, agency and respect inherent in the worker-cooperative governance model. This was one of the most meaningful findings in my research.

Shared ownership models as core business curriculum

One of the barriers to corporate adoption of shared ownership is awareness. I attended a graduate business program at CU Denver and participated in several leadership trainings as a professional. And yet, when I started my own business, I didn’t consider setting up a shared-ownership model because it wasn’t something I’d been taught.

As far as I can tell from my own graduate studies across the Leeds School of Business, the concepts of employee ownership are barely discussed. The solution of shared ownership is proven to be a powerful lever in redistributing wealth, increasing financial security and stabilizing families and communities. Why isn’t it a core part of business school studies?

A few universities offer curricula on employee ownership, including Rutgers University’s School of Management and Labor Relations, the Beyster Institute at UC San Diego's Rady School of Business, and the Baker Center of Excellence for Employee Ownership and Business Transformation at Montgomery County Community College in Pennsylvania. However, at most institutions, individual faculty decide whether and how to introduce the concept.

In a time of deep inequality and climate crisis, the prevailing business-school teachings that prioritize status-quo business governance have the potential to exacerbate these issues. Higher education needs to holistically incorporate diverse business approaches. Future leaders need to know their options. Many young leaders are seeking tools, models and guidance for creating a better future. Shared ownership is a powerful tool.

The government is starting to support and incentivize the adoption of shared ownership, both in  and at the  level. Universities should pay attention and seize the opportunity to rethink their curricula and incorporate education and training on more equitable governance models. The benefits are well documented, unlike many new policy proposals or novel ESG models. 

Widespread adoption of employee ownership could have profound effects. If universities are truly committed to equity, they must include wealth distribution in their efforts, and a proven method for distributing wealth is through ownership. The adoption of shared ownership starts with awareness, and business schools are central to this awareness chain.

Andrea Steffes-Tuttle, who holds an MA in anthropology from CU Boulder, is an anthropologist of work, an entrepreneur, and an organizer for economic justice. She has 20 years of professional experience starting in nonprofit event management and fundraising, moving to marketing leadership in software startups, and on to entrepreneurship and business ownership. Most recently, she completed an anthropological study focused on worker satisfaction and corporate accountability.