ESSAY : Employee Stakeholder Advantages

In Germany, under the model of “stakeholder capitalism”, employee representatives sit on company boards of directors. In the German model of business, it is assumed that both labor (employee representatives) and capital (shareholder representatives) have important stakes in the enterprise and should work in harmony with each other. In the United States, the board of directors usually represents only the owners of the business. What advantages are there to employees as stakeholders in Germany that are not provided to employees in US companies? In the United States, how do employees let management know their stakeholder concerns?

SAMPLE SOLUTION

Questions of whether an employee should be included as part of a company’s board of directors have always been raised owing to the role such boards play in organizations. Just how will employees raise their concerns if they are not made part of the decision making organ? On the contrary, why should organizations involve employees in their board yet they (employees) are mostly a center of a board’s discussion? Isn’t it a conflict of interest? Germany, under the model of “stakeholder capitalism” is an example of a country that embraces the first case scenario while the US is a typical example of the…