Should all employees be given the opportunity to own shares in the company? That was the main question in the BNR Leiderschap radio program in which I recently was a guest, together with Leen Zevenbergen (CEO Qurius) and Pascale Nieuwland from Stichting Nederlands Participatie Instituut. The interview with BNR Deputy Editor Rens de Jong was triggered by a study carried out by Radboud University Nijmegen, which showed that a share purchase plan that covers the entire company has a positive effect on the company and the productivity of its employees.
While many large companies have a share plan for their senior executives, only a few have one for all employees. Accenture is a good example of a company that gives all its employees the option to become a shareholder. In fact, we go further: employees can buy shares at a discount of 15% and when they get promoted they are entitled to a share package. The main reason we introduced this is to encourage commitment. Naturally, it’s highly motivating to be a shareholder of a company that’s doing well.
Nevertheless, in my view, the value of a share purchase plan for employees should not be overestimated. At Accenture, we also try to reward our employees in many other ways as well. In terms of pay, there are several other schemes in place. For instance, all Accenture employees have a personal annual target: if they achieve it, they receive a salary raise or a bonus.
However, many of our younger colleagues also feel the need for other types of compensation for their achievements rather than just financial. Take corporate citizenship, for example. Accenture makes it possible for employees to spend part of their paid working hours making a personal contribution to the society we live and work in. This gives them the chance to apply their ambition and knowledge in a practical way in less privileged areas. They can do that in many different ways – both far away and nearby. Also when it comes to flexible working hours, we offer a lot of freedom.
But I strongly believe that as a company you should offer your employees good opportunities to grow in their career. And that’s exactly what Accenture is very good at. We’re even able to offer them an international career. Getting the best out of ourselves in an inspiring environment – that’s what it’s all about. Whether we’re a shareholder or not.
Anja Groenewoud, Managing Director Accenture Netherlands
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I actually listened to the BNR interview, very nice to read a follow-up in text for a bit more clarification. Nice to see a Dutch CEO writing on a blog as well by the way, don’t know of many others that do.
I personally believe the benefits of stock sharing options for employees are overrated. Especially in firms with a high percentage of internally motivated employees – people who are motivated by the challenges of the job and the opportunities the job holds to grow professionally – the effect of establishing a share purchase plan may even be to negate the positive internal motivational factors.
Moreover, there is quite often a gap between short term behaviors, and long term strategies. Stock options seem to me to be promoting a short-term focus with your employees, whilst most companies are looking for a long-term vision and commitment from their employees.
I expect job seekers in the current economic climate to be focusing more on immediate benefits and certainty (i.e. financial rewards). For the long term, I expect that other factors, like opportunites to learn and grow in your job, will become more important again. Perhaps we will see a merge between the two in the future, whereby companies set up some sort of CSR fund for special projects in which employees can participate financially.