EFES: FW: ESOPs and Regulation

["Daryl.DArt" <Daryl.DArt@ul.ie>]

-----Original Message-----
From: Marc Mathieu [mailto:marcmathieu@marcmathieu.be]
Sent: 31 March 2005 17:48
To: Daryl.DArt
Subject: Re: ESOPs and Regulation


Dear Daryl,
Thank you very much for this.
Would you please send it to efes@cog.kent.edu, I think it is of interest for
all.
With best regards
Marc

----- Original Message -----
From: "Daryl.DArt" <Daryl.DArt@ul.ie>
To: <marcmathieu@marcmathieu.be>
Sent: Thursday, March 31, 2005 6:56 PM
Subject: ESOPs and Regulation


> Dear Marc
> I have read with interest the ongoing debate on regulation versus self
> regulation or laissez faire regarding employee stock ownership plans. I
have
> to admit it find it some what depressing that there should be any debate
at
> all concerning state regulation of these schemes.  The long history of
> employee ownership and profit sharing schemes points to the neccessity for
> regulation if the participants in these schemes are to enjoy any real
> participation, empowerment or security.  There have been numerous
historical
> examples, particularly in the US where these schemes were used primarily
to
> benefit the company rather than employees. (General Accounting Office
Report
> see page 115 in my book).  The most recent example was ENRON.  The ESOP
> association claims it favours participation and empowerment for employees
> yet to my knowledge may still oppose any obligation to pass on voting
rights
> to employees.  The argument of government regulation versus self
regulation
> is an old one but was heard again in the aftermath of ENRON - same old
self
> serving stuff.
> Finally many schemes in the US are not additional benefits for employees
but
> subsitutes for standard wages or pensions - and as pensions are a very
> uncertain benefit.  It is likely that the European Trade Union movement
will
> not support these schemes in the absence of fairly strict regulation to
> protect employee interests.  In the US of course trade unions are of
little
> account due to their weakness and can be safely ignored.
> A brief glance at Chapter 3 Employee Stock Ownership in the US - Worker
> Capitalism would not go amiss and indeed might clarify the arguments
> regarding regulation.  See D.D'Art 'Economic Democracy and Financial
> Participation; A comparative Study  Routledge London 1992.
> Regards
> Daryl D'Art
>
>
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