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Workers with a stake in their company's success are less likely to leave for another job. New research from Asia shows that offering equity to employees can be an effective strategy when recruitment and retention are top of mind for employers.
"When employees have a sense of ownership, they share in the organization's success," according to a report from Computershare, which provides equity plan services. "It gives them a voice within the organization as a shareholder and as a result, they experience greater commitment, develop greater trust in the organization and have a stronger motivation to practice accountability in the workplace. By increasing employee ownership, companies give employees a sense of belonging, creating feelings of loyalty and ensuring their goals and values are aligned with those of the organization."
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More than 8 in 10 equity plan participants don't consider quitting, according to the study. Among other benefits, participants:
- More strongly view themselves as a member of the organization;
- Experience a greater sense of unity with the company's values;
- Develop a greater sense of loyalty and commitment;
- Feel an increased sense of workplace accountability;
- Are more likely to recommend their organization as a great place to work; and
- Are more satisfied with their jobs
"Employee equity plans punch above their weight when it comes to keeping the people you want during tough times, because they strengthen the connection between a worker and their company, especially if that connection is digital, because the employee can physically see their equity increase over time," says Sheila Frierson, president of Employee Share Plans NA for Computershare. "Our client companies are increasingly asking how they implement the 'super-benefit' of employee equity plans to support employees who battled through the pandemic on their behalf and who are now taking the brunt of its financial aftermath."
The study finds that across Asia, companies are using employee share plans as a tool to help achieve their goals by aligning employee interests with those of the organization's shareholders, as well as positively affecting employee attitudes and behaviors. As the popularity of employee share plans increases across Asia, companies are looking to better measure the return from this investment.
U.S. employers may be able to use the same strategy to reward employees and reduce turnover in a turbulent economy. "This research makes it clear that with continued investment in employee share plans, companies are benefiting from a greater positive impact on employee attitudes such as job satisfaction, commitment and accountability, and employee behaviors such as turnover intention," the report concludes.
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Alan Goforth
Alan Goforth is a freelance writer in suburban Kansas City. In addition to freelancing for several publications, he has written a dozen books about sports and other topics.
