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Briefing Paper 2: Enron and Employee-Ownership provides talking points addressing the questions employee-owners will have about risk and retirement following the Enron collapse. [PDF Download]

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Responding to Enron: Resources for Employee-Ownership Companies


The bankruptcy of Enron Corporation and its political effects may be the greatest threat to employee-ownership legislation in the United States in the last three decades.

At Ownership Associates, we believe that those of us who have experienced the benefits of employee-ownership have an obligation to make sure that our legislators understand that employee-ownership is good for Americans and good for America. This page provides information, draft letters, and talking points that highlight the benefits of employee-ownership and respond to the common arguments against it.

Research Evidence on Prevalence and Effects of Employee Ownership

This document contains the testimony of Dr. Douglas Kruse, one of the nation's foremost experts on employee-ownership, before the Subcommittee on Employer-Employee Relations of the House Committee on Education and the Workforce (February 15, 2002). It covers:
  • Prevalence Of Employee Ownership
  • Employee Attitudes and Behavior
  • Firm Performance
  • Employment Stability, Growth, and Firm Survival
  • Employee Wealth and Wages
  • Implications For Public Policy

An Open Letter to the Massachusetts Congressional Delegation

This letter was sent by Ownership Associates to all Senators and Representatives from Massachusetts. It can be used or adapted to create your own letters to our elected officials and the media.

Notable Quotations

  • "In conclusion, employee-owners represent a substantial portion of the U.S. workforce, and 25 years of research shows that employee ownership often leads to higher-performing workplaces and better compensation and worklives for employees. Given the potential economic and social benefits of employee ownership, public policy should seek to ensure that employee-owners have standard perquisites of ownership such as good information to enhance workplace and financial decision-making, but should not substantially restrict employees’ ability to own company stock."
    Dr. Douglas Kruse, Research Evidence on Prevalence and Effects of Employee Ownership, February 15, 2002.

  • "Ownership of a business is not stock trading, nor is it portfolio management of assets. It is what every owner of a private business lives with--good years and bad years... The basic premise of employee ownership is to develop an ownership view, not a stock trader view... There are, and always have been, basic philosophical issues over company stock and the laws that guarantee that an individual employee faces as little risk as possible. Ownership is a risk, but it carries with it rewards that are worth the risk, as proven by the overwhelmingly positive track record of employee ownership in this country."
    Michael Keeling, Executive Director of The ESOP Association, Frequently Asked Questions

  • "A comprehensive study of all private company ESOPs [which are 95% of ESOPs] by Douglas Kruse and Joseph Blasi of Rutgers, completed in 2001, shows that ESOP companies are much more likely to have other retirement plans than matched comparable non-ESOP companies... [In addition] a major study by researchers affiliated with the state of Washington in 1998 found that the average value (per participant) of all retirement benefits in ESOP companies (in 1995) was approximately $32,000, whereas the average value in the comparison companies was about $12,500. The diversified portion of ESOP accounts was about the same as the total account value for the non-ESOP employees."
    Corey Rosen, Executive Director of the National Center for Employee Ownership, Questions and Answers About Enron, 401(k)s, and ESOPs

  • "Employee ownership is one of the fundamental strengths of the American free enterprise system. It has become essential to an entrepreneurial business environment, which gives U.S. businesses a competitive edge, rewards our workforce for their efforts, and contributes to our nation’s prosperity. It is important, therefore, that any response to the events at Enron be the result of thoughtful and careful deliberation rather than a rush to 'do something.'”
    The Foundation for Enterprise Development, Retirement Security and Employee Ownership: Policy Reform After Enron

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