Employee Share Ownership Plans: Evaluating the Role of Tax and Other Factors Using Two Case Studies

29 Pages Posted: 17 Jul 2006

See all articles by Ian Ramsay

Ian Ramsay

Melbourne Law School - University of Melbourne

Andrew Barnes

University of Melbourne - Melbourne Law School

Tanya Josev

University of Melbourne - Law School

Jarrod Lenne

University of Melbourne - Faculty of Law

Shelley D. Marshall

RMIT University

Richard Mitchell

Monash University - Department of Business Law & Taxation

Cameron Rider

University of Melbourne - Law School

Date Written: June 2006

Abstract

Employee share ownership (ESO) has been the subject of significant public policy debate. In these debates, ESO plans are usually said to be implemented for a variety of reasons including alignment of employer and employee interests, increased employee productivity, improved workplace harmony, and increased employee remuneration. This study explores, through case studies of ESO plans at two Australian companies, three key issues relevant to the implementation of ESO plans and the policy and regulation applicable to ESO plans. These issues are: (1) whether ESO plans better align the interests of employees with those of their employer, leading to better enterprise performance; (2) whether the objectives of companies in implementing ESO plans are primarily "ownership objectives," "remuneration objectives" or "workplace change objectives;" and (3) whether the concessional taxation treatment of ESO plans provides an incentive for the implementation of plans in a way that leads to improved enterprise performance.

Keywords: employee share ownership, corporate governance

JEL Classification: G32, H20, J33, J54, K22, K31, K34, M52

Suggested Citation

Ramsay, Ian and Barnes, Andrew and Josev, Tanya and Lenne, Jarrod and Marshall, Shelley D. and Mitchell, Richard James and Rider, Cameron, Employee Share Ownership Plans: Evaluating the Role of Tax and Other Factors Using Two Case Studies (June 2006). U of Melbourne Legal Studies Research Paper No. 151, Available at SSRN: https://ssrn.com/abstract=917065 or http://dx.doi.org/10.2139/ssrn.917065

Ian Ramsay (Contact Author)

Melbourne Law School - University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 5332 (Phone)

HOME PAGE: http://law.unimelb.edu.au/about/staff/ian-ramsay

Andrew Barnes

University of Melbourne - Melbourne Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

Tanya Josev

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

Jarrod Lenne

University of Melbourne - Faculty of Law ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

Shelley D. Marshall

RMIT University ( email )

Melbourne Campus
Building 13
Melbourne, Victoria 3000
Australia
+613 99251382 (Phone)

HOME PAGE: http://www.rmit.edu.au

Richard James Mitchell

Monash University - Department of Business Law & Taxation ( email )

Caulfield Campus
Sir John Monash Drive
Caulfield East, Victoria 3084
Australia

Cameron Rider

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

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