16 Jan 2012
Clegg's employee share push is nothing new
Following Deputy Prime Minister Nick Clegg urging more companies to offer shares to employees, Lawrence Graham's head of employment, Yvonne Gallagher, commented:
"Share participation and ownership schemes have been around for a long time and are widely used already. They undoubtedly do give employees a sense of ownership and involvement.
"The practical problem for private companies arises out of finding a way for employees to turn their shares into money. This is easily done for quoted companies but less so for privately held companies and cash flows won't always allow the provision of benefits in the John Lewis mould of shares of annual profit. This is particularly the case for start-up companies where the owners are investing money rather than taking it out.
"It is perhaps worth noting that politicians have been very quick to criticise gains made by senior employees from share schemes which were designed precisely to provide a sense of ownership and to align shareholder and investor interests. Truly nothing new under the sun!"