Managerial approach to financial participation in Poland
Maciej Kozłowski
Abstract
Purpose: The major purpose of this article is to analyse the most important employee financial participation (EFP) programs in Poland in order to show the occurring relations between the programs applied and the socioeconomic results of enterprises. The focus lies on collecting data and information about financial participation programs among Polish listed companies.
The choice was made due to the data availability on listed companies. Through the collected data, the multidimensional relationships between employee financial ownership and economic results are illustrated, as well as indicating that the relationship mechanisms of employee ownership on productivity are complex interactions by nature. Additionally, it has also helped to separate crucial characteristic features of the applied forms of EFP. This empirical approach concentrates on quantitative research.
Methodology: The research has been based on a questionnaire which was send via the electronic mail. Choosing the elements for the sample was conducted in a way which allowed for selecting out of the listed companies only those which have at least one out of three major financial participation programs, namely the share ownership, profit-sharing or stock option scheme.
Findings: The results of the empirical study conducted in the period of 2010-2011 indicate the existence of some particular regularity. In Polish public companies the vast majority of schemes are aimed at participation of the management personnel. These programs are narrow-based and rather hermetic with a high concentration of stocks or shares in the hands of the management.
Conclusion: EFP programs generally have a positive influence on the functioning of the enterprise. However, the effects are more social than economic. The paper provides a contribution to foster the debate about workers financial participation and aims to take action to popularize these programs on a wider scale.
Keywords: workers’ ownership; financial participation; profit sharing; stock option; workers’ attitude.
1. Introduction
In recent years, complex studies have been carried out considering the impact of financial participation schemes, such as employee ownership, profit sharing, or pension plans, on the economic performance of European companies. They have suggested that financial participation does have an impact on the economic performance of companies (Mathieu, 2010). However, the results are not as satisfying as expected. It is also officially acknowledged that EFP is in accordance with state policy (in the European Union in general) because it has positive influence on efficiency and employment and accelerates fulfilment of other goals of state policy, such as redistribution of wealth or broader participation in creating welfare and overcoming in-company conflicts (Fakhfakh & Pérotin, 2002). The mechanism of a relationship may be as follows: Participation in shares or profits subliminally leads to increased willingness and involvement to better work performance, and at the same time highly contributes to the success of the parent company. Additionally, the efficiency of work increases because there is no overtime. To some extent the employees become more connected with the company, which in turn helps raise profits.
However, gaining information and finding convincing arguments and straightforward evidence about the schemes and their effectiveness is troublesome for companies that want to implement EFP schemes (Pendleton, 1997; Robinson & Wilson, 2001). The commonly shared belief is that through implementation of participatory solutions, companies want to motivate their staff to work better and more efficiently and to convince them to stay with the company. However, the evidence suggests that in companies operating employee participation schemes, work efficiency does not radically change (Pérotin & Robinson, 2002). Therefore, it can be assumed this is not a direct reason for their implementation and the schemes are simply part of a set of employee participation tools (Jirjahn, 2002, pp. 148-178; Kato, 2002, pp. 214-235; Long, 2002, pp. 52-89).
In turn, the analyses conducted in over 20 EU countries, comprising several thousand enterprises, show evidence that EFP has had a positive or at least neutral impact on efficiency. The achieved results are in favour of the higher influence of participation in profit sharing on work efficiency over the influence arising from employee share ownership (Braam & Poutsma, 2010, p. 3; Kruse & Blasi, 1997, p. 114). This might be a result of the differences in conditions in which those schemes are implemented, which in turn cause trouble with measuring the absolute effects achieved in different studies in various countries.
The study focused on the analysis of EFP programs in Polish listed companies in order to increase knowledge on the subject and demonstrate relations between the programs applied and the socioeconomic effects of enterprises. Efforts were made to systematise the forms of participation presented here; although, due to their multitude, occasional lack of clear dividing criteria, and their different interpretation, the results appear dissatisfactory. Nevertheless, due to the shortage of literature concerning EFP issues, this article attempts to fill in the gap to some extent and aims to increase interest in the above solutions. Additionally, some crucial characteristic features of the applied forms of EFP were separated.
It may be surprising that large listed companies were chosen as objects of analysis. Some are privatised and domestic, while foreign private firms represent the rest. Therefore, one could expect some significant remains of employee ownership after the privatisation process. The intention of the author was to deal with existing large companies, regardless of their origin, and to check if they offer EFP programs. In addition, the choice was on the availability of information on listed companies.
2. Theoretical Background – results of the privatization process in Poland
Participation schemes based on company profits and employee share ownership are immensely popular in the European Union. In the four largest countries (France, UK, Germany, Spain), these schemes have covered around 17 million workers (19% employees from the private sector). This is due to earlier experience and traditions with blue-collar worker ownership in France and the UK, cooperatives in Spain or widespread decision-making processes in Germany as a source of EFP. The most popular financial programs are: profit sharing and share ownership in France, varieties of profit sharing in the UK and share ownership in Germany. Countries with a significant number of EFP schemes are Italy, France, Ireland, Spain and Austria; however, post-Soviet states have a less significant number (Mathieu, 2013).
It should be noted that from the national point of view only some types of EFP schemes will be preferred, mainly those which to a great extent will contribute to the achievement of macroeconomic goals. Activities promoting implementation of participatory solutions are conducted in different countries in a varied manner and with a diverse intensity; therefore, one should bear in mind that their spread in particular countries will differ. Nevertheless, there is a constant, yet undynamic growth in the number of employees taking part in EFP schemes. Research conducted by specialists in the EU and US provides us with a large amount of significant information on the nature of these schemes and their achieved results (Caramelli, 2010; Fakhfakh & Pérotin, 2000, pp. 93-111; Freeman, Blasi, Kruse & Mackin, 2010; Hashi, Lowitzsch, Uvalic & Vaughan-Whitehead, 2006; Kalmi, Pendleton, & Poutsma, 2004; Pendleton & Poutsma, 2004; Robinson & Wilson, 2006). In the EU there are organizations involved in EFP, such as the European Federation of Employee Share Ownership (EFES), International Association for the Economics of Participation (IAFEP) and others. Their reports and books are extremely valuable in finding new ways to implement EFP programs.
The data is obtained from, for example, surveys sent to enterprises listed on the stock exchange and to other large companies whose capital is estimated to be at least €200 million (Mathieu, 2009, p. 10).
Nowadays the most prominent form of employee financial participation in Poland is share ownership. The restructuring program in Poland was characterized by key incentives for employee participation, especially in firms transformed into so-called employee-owned companies. The ownership structure in these companies, in general, is relatively stable, and employees who do not hold any executives posts still maintain a substantial number of shares. The research conducted in the late 1990s on a group of 110 employee-owned ‘leasing’ companies, privatized between 1990 and 1996, show that the average participation in ownership of employees who do not hold any executive posts decreased from 58.7% right after the privatization to 31.5% in 1999 (Lowitzsch, Hashi & Woodward 2009, p. 138). Over time, more and more shares belonged to persons outside the company, although it was easy to notice that there were no external strategic investors (Lowitzsch 2006, p. 237). The following years did not bring any improvements with respect to the setting up of employee-owned companies; in fact the situation became worse. This was caused by, inter alia, a lack of interest on the part of politicians and trade unions . The buyout was also hindered due to a clause included in the Transformation Law of 1996, which stated that at least 20% of the shares of a leased company must be purchased by people who are not employed in the company.
The success of the deep restructuring changes in the Polish economy mostly depended on the effectiveness of the reforms concerning the restructuring of ownership in all sectors. This required a new approach to the concept of private property and defining the new role and place of employees in the process of the ongoing changes. Employee companies were formed as a result of direct privatization, so-called liquidation, when the equity of the enterprise is handed over for use with the right to the repurchase by the majority of employees of the established company (see: Bogdanowicz-Bindert & Czekaj, 1997, pp. 329-330). Prior to this privatization it was necessary to convince employees to purchase shares.
One should keep in mind that this method turned out to be effective with respect to small and medium-sized enterprises, which didn’t require the great financial outlays which were necessary for the privatization of larger companies. However, the motives for buying shares can be different from the motives determining their willingness to hold on to them in the future. Therefore it can initially be stated that the conditions for introducing new solutions aimed at increasing the share of employees in ownership or participation in other financial schemes are not very favourable. One can even formulate a thesis that among workers in Polish companies, especially those holding lower posts, there is a subliminal barrier hindering the process of further ownership changes or even the introduction of new forms of economic democracy aimed at the development of a new type of responsibility for the company. Overcoming this barrier may be possible only after some time, when the employee, already being an owner, begins to understand the economic gist of dividends and develops a habit of contemplating on how to increase the value of a company, realizing that this in turn is directly reflected in the value of his or her shares of stock.
It can be said that the structure of law in Poland provides the opportunity to implement different forms of financial participation schemes, including share ownership, profit sharing and the creation of employee-owned companies through transformation processes. However, politicians have not provided incentives for development of such schemes and have not given proper support yet. The most widespread EFP schemes embrace share ownership and profit-sharing programs, although the latter is considered to be a broad-based type of scheme related to company results and in Poland is described as a ‘bonus’, yet it does not have a legal basis. Over the last few years the matter of employee-owned companies and financial participation schemes has been revisited as a result of the extended research and the increased interest by EU institutions.
In comparison to other EU states, the situation in Poland does not appear optimistic and the level of employee ownership in large enterprises is substantially low, as is the dynamics of this development.
The aim of the detailed analysis was to provide an answer to the key question which, unfortunately, constitutes a gap in the existing literature on the topic, namely: What type of personnel structure exerts the most influence on employee opinions concerning the effects of EFP? Four groups of employees were included in the study: managerial, white-collar, blue-collar and administrative personnel. The predominance of one group over another yields different results according to financial effects, and raises additional questions: Does the date when participation was introduced influence employee opinion on the effects of implementing one of three forms of participation? What factors (considered either as barriers or facilitations) determined the percentage of employees covered by a participation program (making allowances for employee structure and the type of program)? The crucial factors were tax incentives, costs of social insurance, company culture, accountancy regulations, and the level of knowledge of the program.
3. Research Method
The study was based on an online survey sent via e-mail. This is an ideal method due to the nature of the community analysed, the situational context and most of all the specificity of the issues examined. This method is based on respondents providing written answers. The drawback is the possibility of conducting the survey only with those who have access to the Internet. The elements for the sample were selected out of the listed companies, which had at least one out of three major financial participation programs, namely the share ownership, profit-sharing or stock-option scheme.
Respondents were provided with limited general information on who conducted the study, topic and purpose. Anonymity was guaranteed, especially if the subject was sensitive and required providing company-internal information.
It was assumed the surveys were filled in by top managers or CEOs. The survey form was divided into three parts and contained 51 questions. The first part concerned information on the company, the second information on financial programs, and the third assessment of employee participation in the programs of EFP. A small number of questions were closed questions; the others were multiple-answer and multiple-choice questions.
The survey was prepared based on numerous similar surveys used by international companies and organizations to study the same problems (i.e. Slovenian and Dutch companies, CRANET data), yet their scope and analyses are broad-based. Two Slovenian surveys helped to prepare the survey for Polish companies: VPRAŠALNIK za MENEDŽERJE (the questionnaire for managerial staff) and VPRAŠALNIK za predstavnika SINDIKATA (the questionnaire for trade unions), to learn the different attitudes to EFP . The general four-page ‘Questionnaire for Survey complementing the CRANET data on employee financial participation’ was also used to prepare questions for Polish companies. Some questions and study problems were taken from a Dutch report (Poutsma, 2006). The survey prepared for Polish companies was slightly modified to be suitable for Polish conditions. Each question had additional sub-clauses that described the precise analysed issues. The Polish survey was divided into three parts: general information about the company (activity of the company, employee structure, ownership structure, salaries, etc.), EFP programs implemented and offered in companies to different groups of employees (employee ownership plans, profit-sharing plans, stock options, percentage of employees covered by these programs, barriers and facilitations to implement EFP programs, etc.), as well as employee opinions about EFP programs (economic results, worker cooperation, worker attitude, law regulations, etc.). The study was conducted on a sample of Polish companies listed on the Warsaw Stock Exchange. The total number of companies covered by the analysis was 645.
Companies that had at least one out of three major EFP programs, namely a share ownership, profit-sharing or stock-option scheme, were chosen for the sample. In order to single out companies with financial participation programs, the companies were contacted to identify if they had any such program.
Finally, 121 companies were chosen and sent the questionnaire via the Internet. Monitoring the return rate was difficult due to a high number of firms and frequent necessity to remind the companies to return the form. In many cases, the interviewers had to visit the company in order to help fill in the survey. The survey was primarily conducted from 3 November 2010 to 31 October 2011, but was extended for some companies . Five people collected information. Twenty-eight companies did not return their surveys. Before the start of the statistical analysis, those entities that provided incomplete data of more than 50% were removed from the survey. Consequently, further analyses were based on the information collected from 73 companies (response rate 60%). This was enough data to explore certain relationships in companies where any of the participatory programs were implemented.
Due to a significant number of variables, it is reasonable to explicitly explain some. Generally, there are independent variables that have an influence on financial programs implemented in the companies, including size of the company, sector of activity and the employee structure, ownership structure, job seniority, etc. Some of the dependent variables are share of employees covered by the program, company financial indicators (productivity), willingness for higher involvement, efficiency of work, better profits, and social benefits.
4. Management share in employee participation programs – results
A significant group of questions concerned the correlation between the percentage of managerial staff or of managerial staff and another group of personnel of Polish companies covered by financial participation programs with such aspects as, among others, obtaining benefits, identification with the company, and types of implemented programs (share ownership, profit sharing) . Another question asked referred to defining factors that may influence realisation of each of three programs: share/stock ownership, share/stock options and profit sharing. The interactions have been classified as: barriers, facilitations, and no effect. In the last part of the text the effects of introduction of all participation solutions are presented.
4.1. Descriptive statistics – levels and types of financial participation
This part focuses on the relationships between the questions and describes in detail the level of the contingency coefficients, i.e. Pearson’s C and Kramer’s V, together with the accompanying levels of significance. The analysis divides the division of enterprises into three groups. The first group includes companies in which up to 25% of the managerial personnel took part in participation programs. In the second group are firms in which the share of the managerial staff ranges from 25-75%, and the third group is represented by firms in which at least 75% of the management was covered by different programs.
At the beginning of the analysis it became apparent that in companies where the managerial staff was covered by an employee share ownership program, there was a directly proportional relationship between the payments resulting from using programs that contributed to achieving financial benefits for the company and the percentage of the management covered by such a scheme. Simultaneously, over 60% of all respondents declared that financial participation programs aimed at the managerial personnel are connected with the general results of the firm.
Investigating the relationships between the percentages of the managerial personnel covered by a scheme and their attitude toward their own company resulted in the answers in Table 1.
Table 1. Attachment of the managerial personnel to the company according to the percentage of this employee group covered by a share ownership program in percentage (N=49)
Attachment to the company Managerial personnel covered by employee financial participation programs – Stock/share ownership Total
100-75% 75-25% 25-0%
Very high 53.1 26.5 6.1 85.7
High 0.0 0.0 14.3 14.3
Total 53.1 26.5 20.4 100.0
Source: Survey among Polish listed companies 2010/2011, own calculations.
A strong correlation has been observed (Kramer’s V = 0.806) between the percentage of managerial personnel covered by a stock/share ownership program and their attachment to the company. Respondents taking part in the survey indicated the higher the number of managerial staff participating in a stock/share ownership program, the stronger the bonds with the company for which they work. This regularity is statistically significant. However, there were no significant relationships between the number of white-collar workers covered by the scheme and the strength of relationship between them and the company.
Another point to be analysed was the question of whether the year when participation was implemented had influenced the results, i.e. higher identification with the company and better relations among workers. The selected correlation is presented in Tables 2-3. A division into two periods was introduced – up to 2004 and from 2005 to 2011.
Table 2. The influence of the time when a share ownership/profit-sharing program was implemented on the attitudes characterising identification with the firm according to investigated companies in per cent (N=47)
Introduction of employee financial participation Identification with the company –
Stock/share ownership Total
Positive No effect Negative
Up to 2004 47.0 21.0 0 68.0
2005 to 2011 32.0 0.0 0 32.0
Total 79.0 21.0 0 100.0
Source: Survey among Polish listed companies 2010/2011, own calculations.
A detailed analysis of the results of using a share ownership program indicated a significant relationship between the scheme and the time when it was introduced in the company (Pearson’s C = 0.335). In firms where the programs were introduced in 2005, all respondents expressed a positive opinion of the scheme’s impact (stock/share ownership) on identifying oneself with the company. Among respondents who said that in their enterprises the programs were introduced up to 2004, 47% shared a favourable belief in their positive influence, while others stated that implementation did not have any impact on identification with the company.
Table 3. The influence of the time when a share ownership/profit-sharing program was introduced on the relations between employees in companies in percentage (N=47)
Introduction of employee financial participation Relations between employees in the company – Stock/share ownership Total
Positive No effect Negative
Up to 2004 21.3 23.4 23.4 68.1
2005 to 2011 19.1 12.8 0.0 31.9
Total 40.4 36.2 23.4 100.0
Source: Survey among Polish listed companies 2010/2011, own calculations.
The relations between the workers in companies, which implemented the schemes up to 2004, are evaluated differently by various firms (Pearson’s C = 0.367). The results show that 21 – 23.4% of the investigated companies mentioned the positive influence of the program, no influence or a negative impact on interpersonal relations, which means that on the basis of 23.4% of the firms in which the program had been introduced earlier, the scheme exerted a negative influence on relations between employees. This may stem from a disproportional distribution of the program among the employees. In firms that implemented a stock/share ownership programs after the year 2004, the situation looks completely different. In these companies, almost 20% of respondents indicated the positive impact of the scheme on relations between employees, while the others were of the opinion that relations did not change. This is indicative of a qualitative improvement in the functioning of the schemes, which contributes to better relations between employees.
Considering the frequently antagonistic relations between the management and other workers (mostly blue-collar), respondents were asked a question on whether implementation of the scheme contributed to improving relations between these groups of personnel (Table 4).
Table 4. The influence of implementing a share ownership/profit-sharing program on the relations between workers and the management in the investigated companies in percentage (N=47)
Introduction of employee financial participation The relations between workers and the management Total
Positive No effect Negative
Up to 2004 23.4 6.4 38.3 68.1
2005 to 2011 19.1 12.8 0 31.9
Total 42.5 19.2 38.3 100.0
Source: Survey among Polish listed companies 2010/2011, own calculations.
Analysing the questionnaires displayed a moderately strong (Kramer’s V = 0.565) relationship between the year when the program was launched and its influence on the relations between blue-collar workers and the management. Respondents from firms that started their stock/share ownership program from the year 2005 did not notice any difference between the impact of the scheme on the relations between blue-collar workers and the relations between these workers and the management. These differences are noticeable in the case of firms in which the program was implemented earlier. Over half of the respondents (56.2%) observed negative influence of the scheme on the relations between blue-collar employees and the management, and only one third noticed a positive impact on the relations between them. It appears that employee relations in firms which introduced the programs later seem to be more improved than in those companies where the schemes had been in operation for a longer time. This situation may be surprising because firms with greater experience in using participation programs should be characterised by a lower level of conflicts between these groups of personnel, but the study did not confirm this. Perhaps the above-mentioned promotional and educational campaign has made everyone aware that only mutual support and cooperation can contribute to the success of the program.
The analysis of the responses also showed mutual relationships between the percentage of the managerial personnel covered by a stock/share ownership program and the factors that may also affect implementation and realisation of the scheme. These factors were the level of employees’ interest (Pearson’s C = 0.541) and the level of owners’ interest in a particular scheme (Pearson’s C = 0.707). In firms where over three quarters of the management was covered by a stock/share ownership program, all respondents claimed that the interest level of both employees and owners has a significant influence on realisation of the program itself (54% of all the respondents in this group of the managerial staff). Only in enterprises where less than 25% of the management is offered this ownership program did respondents think the level of interest on the part of owners hindered realisation of the scheme (15% of all respondents and 78% of companies in this group). Such a small percentage of managerial personnel participating in the program is a result of the low engagement of firm owners who are not interested in implementing the schemes and do not see any benefits. In the other two groups, the owners were much more interested in introduction of financial programs, possibly because the management personnel had a high or very high level of participation in these programs.
4.2. Perceived factors influencing the introduction of financial participation schemes
The aim of the detailed analysis was to provide answers to, among others, the following question: what factors (considered as barriers and facilitations) influence the percentage of employees covered by a participation program, allowing for the employee structure and the type of program?
The analysis showed significant correlations between the percentage of the management in the company covered by a stock/share ownership program and other factors, which may affect its realisation. Therefore, it is advisable to list the most crucial of them (tables 5-14).
Table 5. Regulations concerning accountancy (Pearson’s C = 0.615) in percentage (N=48)
Stocks/shares owned by managerial personnel (in %) The regulations concerning accountancy as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 25 29.15 0 54.15
75-25% 4.15 6.25 16.7 27.1
25-0% 14.6 4.15 0 18.75
Total 43,75 39.55 16.7 100
Over 16% of respondents representing companies in which 25-75% of the management is covered by the program think that accounting regulations facilitate realisation of the scheme. For more than 14% of the respondents in companies where less than 25% of the management is able to participate in the scheme and for over 25% of respondents from firms where more than 75% of the management is covered by the scheme they represent a barrier.
Table 6. Administration/bureaucracy (Pearson’s C = 0.746) in percentage (N=48)
Stocks/shares owned by managerial personnel (in %) The administration/bureaucracy as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 0 54.15 0 54.15
75-25% 0 10.4 16.7 27.1
25-0% 14.6 4.15 0 18.75
Total 14.6 68.7 16.7 100
All respondents from firms in which over 75% of managerial staff take part in a share ownership program believe that this factor does not have any influence on realisation of the program. Administration/bureaucracy is seen as an obstacle by 14.6% of respondents from firms where less than 25% of managerial personnel were covered by the scheme and over 16.0% of respondents representing companies in which 25-75% of top-level employees are offered the scheme say this factor makes introduction of the program easier.
Table 7. The level of knowledge about the programs (Pearson’s C = 0.362) (N=48)
Stocks/shares owned by managerial personnel (in %) The level of knowledge about the programs as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 9 17 0 26
75-25% 3 10 0 13
25-0% 7 2 0 9
Total 19 29 0 48
This aspect was not mentioned as facilitating realisation of the program. Four in ten respondents think of this factor as a barrier to realisation of the scheme (40.0%), while the highest percentage was observed in firms in which less than 25% of the management is covered by the scheme (77.8%). At the same time, as many as 35.0% of companies in which 75-100% of the management take part in financial participation programs say the level of knowledge does not exert any influence on implementation and realisation of the program. This may be a group of companies in which the management has sufficient knowledge allowing them to administer these schemes, yet a large number of representatives think the opposite. It seems this opinion is crucial if one wants to adequately prepare the company for introduction of the program and achieve the necessary level of knowledge.
Table 8. The level of political support/interest from the government (Pearson’s C = 0.578) (N=48)
Stocks/shares owned by managerial personnel (in %) The level of political support/interest from the government as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 9 7 0 26
75-25% 3 2 8 13
25-0% 0 7 2 9
Total 12 26 10 48
Only respondents from companies with the highest percentage of management covered by the program consider this factor as a barrier to its realisation (35%), while almost two thirds of this group believe that it does not have any influence on introduction of the scheme. It can be assumed that the first group (75-100%) perceives the level of political interest as too low, and as such, treats this factor as a barrier hindering implementation of schemes.
Table 9. Requirements on securities (Pearson’s C = 0.466) in percentage (N=48)
Stocks/shares owned by managerial personnel (in %) The requirements on securities as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 25 10.4 18.75 54.15
75-25% 4.15 16.65 6.25 27.05
25-0% 14.6 4.2 0 18.8
Total 43.75 31.25 25 100
Almost 44% of all the people taking part in the survey believe that the requirements on securities are a barrier to the realization of a stock/share ownership program and 1/4 consider this factor helpful. It is difficult to provide a reliable interpretation of so many skeptical answers because, in the case of examined companies which do not have foreign branches, this percentage should be lower. The smaller the number of managerial personnel participating in the schemes, the more negative opinions about the influence of this factor on the realization of the programs.
Table 10. Corporate culture (Pearson’s C = 0.597) in percentage (N=48)
Stocks/shares owned by managerial personnel (in %) The corporate culture as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 0 10.42 43.75 54.17
75-25% 16.66 0 10.42 27.08
25-0% 0 4.15 14.6 18.75
Total 16.66 14.57 68.77 100
Considering the impact of corporate culture on realisation of the program, the opinions vary. Although 68.8% of all the respondents treat this factor as a form of facilitation, 16.66% of the companies’ representatives, in which 25-75% of the management are covered by the program, believe that corporate culture is an obstacle to fulfilling the scheme. This factor is frequently mentioned by authors who work on, among other things, the conditions of implementing participation solutions as one of the major determinants facilitating or inhibiting fulfilment of programs.
Table 11. The company structure (Pearson’s C = 0.536) (N=48)
Stocks/shares owned by managerial personnel (in %) The company structure as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier Facilitation No effect
100-75% 0 21 5 26
75-25% 0 5 8 13
25-0% 0 0 9 9
Total 0 26 22 48
More than half of respondents (54.2%) believe that a proper company structure may facilitate realisation of a stock/share ownership program, while other respondents do not see the influence of company structure on implementation of the program (45.8%). However, it is possible to notice regularity – the higher the number of managerial personnel taking part in the schemes, the more of them perceived the structure of the company as a facilitating factor in realisation of the program. This may also be connected with personnel structure in the examined companies.
Table 12. Market conditions (Pearson’s C = 0.536) (N=48)
Stocks/shares owned by managerial personnel (in %) The market conditions as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier Facilitation No effect
100-75% 0 21 5 26
75-25% 0 5 8 13
25-0% 0 0 9 9
Total 0 26 22 48
Among firms with the highest percentage of management covered by the scheme, over 80% declared that market conditions make realisation of an ownership scheme easier. Consequently, once again there is a clear correlation – the more managerial personnel covered by the scheme, the higher the number of those who express a favourable opinion of the influence of market conditions on fulfilling the program.
Table 13. Cross-border harmonization of systems (Pearson’s C = 0.398) (N=48)
Stocks/shares owned by managerial personnel (in %) The cross-border harmonization of systems as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier Facilitation No effect
100-75% 0 0 26 26
75-25% 0 0 13 13
25-0% 2 0 7 9
Total 2 0 29 48
A little over 22% of the representatives from firms in which less than 25% of managerial staff were covered by an ownership program, or every twenty-fifth person surveyed, consider cross-border harmonization of systems to be a barrier to fulfilling the scheme. The vast majority (95.8%) of the respondents regard this factor as unimportant for the realization of the program. This should not be surprising considering the absence of branches in other countries.
Table 14. Restricting programs to particular groups of personnel (Kramer’s V = 0.860) (N=48)
Stocks/shares owned by managerial personnel (in %) The restricting programs to particular groups of personnel as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier Facilitation No effect
100-75% 0 0 26 26
75-25% 0 0 13 13
25-0% 0 7 2 9
Total 0 7 41 48
In firms where less than 25% of the management was covered by a stock/share ownership program, over 7/10 of the respondents claim that limiting the use of schemes to particular groups of employees makes the realization of the scheme easier. Such an opinion was expressed by almost every seventh person in the survey.
Interesting (though rather controversial) results were achieved when asking about the influence of legal regulations on realisation of ownership programs in companies. The previously mentioned lack of legislation and legal solutions regulating the preparation and implementation of financial participation programs may, on one hand, act to facilitate, or on the other hand, become a significant barrier to their realisation (Table 15).
Table 15. The legal framework as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs (N=48)
Stocks/shares owned by managerial personnel (in %) The legal framework as a factor affecting realisation of financial programs in companies according to the percentage of managerial workers covered by share ownership programs Total
Barrier No effect Facilitation
100-75% 0 54.2 0 54.2
75-25% 0 10.4 16.7 27.1
25-0% 14.6 4.1 0 18.7
Total 14.6 68.7 16.7 100
Source: Survey among Polish listed companies 2010/2011, own calculations.
The results indicated strong and significant correlations (Pearson’s C = 0.746). All respondents from firms where more than 75% of the management is covered by a stock/share ownership program declared that legal regulations do not affect realisation of the scheme. However, they are seen as a barrier by 77.8% of respondents in firms where less than 25% of the managerial personnel take part in the program. Over 61% of the respondents representing companies in which 25-75% of top-level employees participate in the programs are of the opinion that