Rutgers Awards Fellowships to Study Contributions of Employee Ownership, Profit-Sharing to Business Success

NEW BRUNSWICK, N.J. – It is well-documented that companies in which workers have a financial stake through profit-sharing and employee stock ownership can benefit from higher economic performance and productivity than otherwise comparable firms that do not follow those practices. To study the role that shares can potentially play in the success of firms, as well as the evolving social and economic structure of the corporation and the future of American business, Rutgers’ School of Management and Labor Relations (SMLR) has appointed 18 new research fellows.

“The goal of our fellows program is to build a new generation of scholars to study workplace issues and focus on how employees at all levels can share in the benefits of a company’s success by considering the relevance of equity and profit-sharing,” said Dean Susan J. Schurman.

Schurman noted that more than 17 percent of American workers own some share in the companies where they work, about 9 percent hold company stock options and about one-third have some form of profit-sharing, according to a recent Rutgers analysis of the national General Social Survey of Employed Adults. She added that the idea of employee stock ownership has been widely disseminated in small businesses through the Employee Stock Ownership Plan and in large corporations, especially such high-tech companies as Google, through a variety of broad-based equity plans.

“Broad-based employee ownership and profit-sharing are generally associated with better firm performance and individual commitment at work with a supportive corporate culture,” said Joseph R. Blasi, a sociologist and the J. Robert Beyster Professor of Employee Stock Ownership at SMLR. The named professorship is part of the school’s J. Robert Beyster Fellowship Program established with a major endowment and series of gifts from J. Robert Beyster and Mary Ann Beyster of the Foundation for Enterprise Development.

By bringing together as fellows economists; finance, legal and policy experts; human resource and industrial relations scholars; anthropologists; historians; philosophers; political scientists; psychologists; sociologists; and others, SMLR aims to gain new interdisciplinary insight on corporations and the responsible roles that workers can play in the business community.

Besides the gifts from the Beysters and the Foundation for Enterprise Development, additional program contributions have been from other foundations, including the Employee Ownership Foundation, and numerous individuals. With assets of more than $400,000, the fellowship program is one of the largest at Rutgers. Fundraising for fellowships has been one of the top priorities in Our Rutgers, Our Future, the university’s historic $1 billion campaign.

Blasi is director of the fellowship program. He is joined in the program by SMLR Professor Douglas L. Kruse, an economist and J. Robert Beyster Faculty Fellow who has led some of the seminal econometric studies on employee stock ownership, and Professor Richard Freeman of the Department of Economics at Harvard, who serve with other senior scholars as faculty mentors to the fellows. The trio’s forthcoming book, The Citizen’s Share, will be published by Yale University Press in the fall of 2013.

The program hosts two annual national conferences for the entire assembly of fellows – a summer Beyster Fellows Symposium and a mid-year fellows workshop in honor of Louis O. Kelso, supported by investment banker John Menke of Menke and Associates, to bring researchers together to present their studies and develop a community of scholars and a cross-generational, interdisciplinary network of researchers.

Rutgers’ School of Management and Labor Relations is the leading source of expertise on the world of work, building effective and sustainable organizations and the changing employment relationship. The school comprises two departments, one focused on all aspects of strategic human resource management and the other dedicated to the social science specialties related to labor studies and employee relations. In addition, SMLR offers many continuing education and certificate programs taught by world-class researchers and expert practitioners.