Which term refers to giving employees ownership stakes in the company?

Which term refers to giving employees ownership stakes in the company?

• A. Share ownership scheme
• B. Profit Sharing
• C. Commission
• D. Bonus

Answer: (A)

Giving employees ownership stakes means they own part of the company through shares, which ties their interests to the business’s success and can include a chance of dividends or value from share price. The term for this is a share ownership scheme (often called an employee stock ownership plan). This is different from profit sharing, which simply distributes a portion of profits to staff without giving them actual ownership; from commission, which is pay based on sales performance; and from a bonus, which is an extra payment not tied to ownership or long-term stake. So, the share ownership scheme best describes giving employees ownership stakes.

Giving employees ownership stakes means they own part of the company through shares, which ties their interests to the business’s success and can include a chance of dividends or value from share price. The term for this is a share ownership scheme (often called an employee stock ownership plan). This is different from profit sharing, which simply distributes a portion of profits to staff without giving them actual ownership; from commission, which is pay based on sales performance; and from a bonus, which is an extra payment not tied to ownership or long-term stake. So, the share ownership scheme best describes giving employees ownership stakes.