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The impact of employee shareholding on corporate governance: the employee shareholder director in France


Employee share ownership offers the workforce an opportunity to participate in the growth of their company via two mechanisms: profit sharing and power sharing. Profit sharing has been widely studied in the academic literature. Power sharing, on the other hand, has received little attention—notably in the form of the presence of a director representing the interests of employees who own shares on governance bodies. We study 10 French companies with employee shareholder representation on governance bodies, and our findings reveal the dual nature of the role. On the one hand, the participation of employee shareholders in governance bodies seems to have an influence on the disciplinary, partnership, cognitive and behavioural levels. On the other hand, it can be a source of entrenchment, as tensions that are specific to this little-known mandate reflect tensions within the company itself.

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Data availability

Data can be supplied upon request.


  1. National Opinion Research Center (2018).

  2. Annual Economic Survey of Employee Share Ownership in European Countries (2019).

  3. French law provides for two corporate structures: either a board of directors and a chairman/CEO, or a board of directors and a supervisory board. The board of directors defines strategy and, together with general management, takes managerial decisions. The supervisory board is exclusively responsible for monitoring the company’s general course of affairs a posteriori, together with a priori powers of co-decision-making, notably the authorisation of certain operations provided for by law, or under the company’s articles of association.

  4. Annual Economic Survey of Employee Share Ownership in European Countries (2019).

  5. Since 22 October 1999, this has been known as the Euronext FAS IAS index (FR0003999598). FAS: French Federation of Employee and Former Employee Shareholders. See:

  6. The report presented by the board of directors or the management board to the annual general meeting includes data regarding the employee shareholding as it stood on the last day of the financial year. It sets out the percentage of capital held by the company’s employees, by employees of related companies under the company savings plan, and by employees and former employees in mutual funds.

  7. The Annual Economic Survey of Employee Share Ownership in European Countries (2018) considers that a rate below 1% is ‘insignificant’; 1–6% is ‘significant’; 6–20% is ‘strategic’; 20–50% is ‘decisive’; and above 50% is ‘controlling’.

  8. The Copé–Zimmermann Law (2011) on the balanced representation of women and men on boards of directors and supervisory boards.

  9. Auberger-Barré & Bouchet (2007).

  10. Annual Economic Survey of Employee Share Ownership in European Countries (2019).


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The authors wish to thank FAS and Fondact for their help throughout the process.


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All authors, HC and TPR, contributed to the study conception and design. Material preparation, data collection and analysis were performed by HC. The first draft of the manuscript was written by HC and TPR. All authors read and approved the final manuscript.

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Table 2 Characteristics of the companies that took part in the case study and interviewees (mandate/function)


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Cardoni, H., Poulain-Rehm, T. The impact of employee shareholding on corporate governance: the employee shareholder director in France. J Manag Gov (2022).

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  • Employee shareholding
  • Board of directors
  • Employee shareholder director
  • Corporate governance
  • Participation in decision-making