Not long ago, the main appeal for owning something was a combination of freedom and control.
Owning a car meant you had the freedom to travel wherever the road took you. (And some places where the road didn’t even exist.) It also meant a level of control over how and when you traveled, and how you treated your car. (By comparison, try painting your rental car metallic umber or replacing the steering wheel with a fuzzy one and see how far you get.)
Owning a home meant greater control over your monthly expenses, since you were no longer at the mercy of a landlord who could jack up your rent. It also meant the freedom in your “castle” to do as you pleased, when you pleased—including keeping strangers out of your home, if you wished.
These benefits of owning personal property, though, run counter to the reality of owning a business—as many employee owners can attest.
Owning a business means you take on responsibility for your product, your customers, your brand—everything. And that responsibility never takes a vacation. That doesn’t exactly mesh with the idea of driving your car off whenever you please, the breeze blowing through your hair, does it?
This disconnect between the ownership of personal property and business property often causes people to stumble when they first learn of employee ownership. They expect employee owners to have the freedom to do what they want, and to control day-to-day aspects of the business. But that is not how most employee owned businesses operate.
As a result, when some people are introduced to employee ownership, their outsized expectations can lead to crushing disappointment. As many in the ESOP community have noted, this disconnect is a fundamental challenge to explaining and expanding employee ownership.
But concepts of ownership are shifting, which may provide a new opportunity to help spread the word on ESOPs and shared capital more easily.
Today, people are far more willing to let strangers drive their cars and live in their homes—for a limited time, and for a fee. The notions of freedom and control are no longer absolute; owners of personal property are now willing to forego both freedom and control. In return, they are tapping the unused capital in their cars and homes.
In short, they are treating their personal property like business property—like something that should provide a return on investment.
There are parallels here to owners who share with employees the capital locked in their businesses. Like those who rent their homes and cars, these business owners are tapping their capital to get tangible returns. Those returns include greater participation from employee owners, who respond by investing more of themselves in the company.
These parallels are not perfect, but they don’t need to be. It is enough to note that the longstanding, fundamental, and emotional connections we have regarding ownership are starting to shift, and in ways that may make it easier for a larger audience to grasp the notion of shared capitalism.
Perhaps we are seeing the beginning of a new period, in which it gets just a little easier to have conversations about ESOPs and employee ownership. That would be a great thing—and a great thought on which to begin this year’s celebration of Employee Ownership Month.