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Financial Participation

In Norway various forms of participation in the enterprise are possible for employees. The incidence of profit-sharing and employee share ownership schemes is slightly above-average by European comparison and related to the size and nature of the company.

The structure of profit-sharing and employee share ownership schemes in Norway is not uniform. Companies can set up employee share ownership schemes with different conditions.1 Such schemes can apply to all employees in a company or only to certain groups. Employee share ownership in Norway is widespread primarily among top management and in start-up firms with low capitalisation.2 In smaller companies in the high-tech sector, for example, profit-sharing schemes are offered to many employees as part of remuneration packages to attract highly qualified staff.3 The incidence of profit-sharing and employee share ownership schemes is related to the size of the enterprise. The findings of the Annual Economic Survey of Employee Ownership in European Countries 2012 show that workers’ financial participation schemes are widespread in Norway, especially in large companies.4 According to this study 54.6% of the largest Norwegian companies offer broad-based (employee share ownership) participation schemes to the whole staff. Around 95.9% of the largest Norwegian companies offer at least some of their employees a form of financial participation. In other words, practically all large Norwegian companies implement workers’ financial participation schemes. With regard to the incidence of broad-based (employee share ownership) participation schemes large Norwegian companies are slightly above the European average.

 

The findings of the employee survey undertaken by Eurofound within the framework of the fifth European Working Conditions Survey (EWCS 2010) show that the incidence of profit-sharing schemes in Norway is 9% and that of employee share ownership schemes is 2.7%.5 According to these figures Norway lies somewhere in the middle of the companies investigated, by European comparison, as regards profit-sharing schemes and in the upper third as regards employee share ownership. In both cases Norway is below the European average, however. These values are of only limited reliability, however, due to individual statistical outliers in the countries concerned.

 

For the Cranet study in 2011 HR managers in 29 countries were surveyed on the incidence of workers’ financial participation schemes in their firms. This study concludes that in Norway there are profit-sharing schemes in 26% of the relevant companies (with 1oo employees or more).6

Example: The employee share ownership scheme of the Norwegian company Orkla

 

The Norwegian company Orkla is the leading manufacturer of brandname consumer goods in Scandinavia and employs around 28,000 people. Orkla is thus one of the largest Norwegian companies. Since 1999 the company has offered its employees an employee share ownership scheme.7 The employees can buy shares at a preferential price, substantially below the market price. The scheme is intended to enable the employees to participate in the company’s profits and to boost their loyalty and motivation.8 Around 35% of Orkla’s employees took part in the first scheme in 1999 and bought shares.9 The company regards the scheme as a success. In 2013 – 14 years after the launch of the scheme – the company offered the employees more shares at a preferential price (30% below the market value).10

Wilke, Maack and Partner (2014) Country reports on Financial Participation in Europe. Prepared for www.worker-participation.eu. Reports first published in 2007 and fully updated in 2014.