Participative management, employee participation in the wealth of mining companies : an employee share ownership participation scheme focus

M.B.A.The importance of a free market in a post apartheid South Africa has been acknowledged. The benefits should be spread so that all individuals may be able to share in the wealth generated by the people within the country. Privatisation is one mechanism for redistributing the wealth ofthe State, and the use of an Employee Share Ownership Participation Scheme (E.S.O.P.S.) is a way in which the wealth can be spread over a large proportion ofthe population. This was a basic policy of Thatcher's Government in the U.K. The same rationale is apt for the South African situation. An E.S.O.P.S., is similar to a profit sharing or a pension plan, and may be grouped with various holistic empowerment strategies. There are however two fundamental differences from these two traditional plans: 1. It invests only in the equity ofthe employer 2. The E.S.O.P.S., provides the organisation with an increased finance tool, through an increased ability to borrow. One of the business trends, in the U.S.A. and the U.K. and more recently in South Africa has been to extend the ownership of shares to employees. This secures a stake in the company, an avenue for retiring owners, and as protection against hostile takeover bids. Other motives that have been used are, as an educational experience and also as a part of participative management philosophy. The author has made a study of the acceptance of E.S.O.P.S., schemes in the South African Mining Industry and the impact of this concept on the workers through an attitude survey. The author headed the Department of Mining Engineering in the new University of Johannesburg, Faculty of Engineering and the Built Environment. He lectures the subjects Mineral Engineering Management, Coal Mining and Coal Services to candidates for the National Diploma (NO) and Bacculareus Technologae (B Tech) in Mining Engineering