Employee Ownership at Chobani: Telling a Different StoryOn April 26, the yogurt maker Chobani announced that members of its 2,000-person workforce would be receiving an ownership stake worth around 10% of the company. The extensive press coverage struck a chord with the public, and that's because this story is the opposite of the stories we have become used to hearing.
Chobani CEO Hamdi Ulukaya's generous decision to provide stock to the workers comes as most headlines are about income inequality, outsourcing, fights over the minimum wage, and deindustrialization. When Mr. Ulukaya says that he is giving ownership to workers because he "cannot think of Chobani being built without all these people," it speaks of a sense of respect, idealism, and community. When one of Chobani's new employee-owners says "it's the best thing because you're getting a piece of something you helped build," it makes all of us realize that businesses could be very different than they usually appear in the news these days—and, quite likely, very different from our own employers.
Mr. Ulukaya's decision to share ownership of Chobani with the workers is bold, but it is not new. Employee ownership makes Chobani part of a "shared capitalism" tradition in the United States that predates the founding of the country and now includes thousands of companies and millions of employee-owners in industries from food to manufacturing and construction to engineering and retail.
As with many other business owners who gave or sold shares to their employees, Mr. Ulukaya's decision is not just an act of generosity: it is also a savvy business strategy. Decades of research show that employee-owned firms are more productive, more durable, and faster growing than their non-employee-owned peers. Many business leaders who shared ownership with their employees found the increased value of the company more than made up for their reduced stake in percentage terms. Owning part of something huge is better than owning all of something small.
When all the employees have a common interest in the health of their company, why wouldn't they work harder and smarter? As Mr. Ulukaya told Chobani workers, "we used to work together; now we are partners."
The National Center for Employee Ownership is a nonprofit organization that provides objective, reliable information on employee ownership. To learn more about employee ownership, see the links below.
- A Brief Overview of Employee Ownership in the U.S.
- A Statistical Profile of Employee Ownership
- The Employee Ownership 100: America's Largest Majority Employee-Owned Companies
- Key Studies on Employee Ownership and Corporate Performance
- Infographics at ESOPinfo.org
- Article in the New York Times, "At Chobani, Now It's Not Just the Yogurt that's Rich," by Stephanie Strom (April 26, 2016)
- Coverage by NPR, "Why Chobani Gave Employees a Financial Stake in Company's Future," by Yuki Noguchi (April 28, 2016)