Reinventing profit sharing

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Michel BON

President, Fondact (Association which encourages participatory management of savings in companies and employee shareholdings)

Seminar Economy and meaning | Thursday May 24, 2012 - 9h - 11h30

Each of the three stakeholders in a company – the employees, share-holders and clients – would like to obtain the majority of the added value produced by the company. Clients and share-holders are able to make their voices heard, however it is much more difficult for employees to take part in a profit share scheme. Profit sharing and employee incentive schemes have progressively lost their clarity and effectiveness because of the increasingly complex legal framework and rising taxation linked to numerous objectives which are sometimes contradictory. Reinventing profit sharing for employees would help companies during this difficult economic period especially with regard to strengthening employee motivation, stabilising at least part of the company capital, encouraging saving, and helping create social peace. However, politicians who are always looking for new financial resources do not seem to be very open to these ideas.

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