Industrial Policy for a Sustainable European Economy: Toward Ownership that Works for People 


This text was drafted as the conclusion of the Conference “Transforming Ownership in Times of Overlapping Crisis”, held in Amsterdam, 5-6 October 2023. We are preparing a longer white paper on the basis of the conference contributions. Hence, any reactions to the text below are welcome. Please send them to: and

Marija Bartl, University of Amsterdam & Rutger Claassen, Utrecht University

I. Introduction

There is broad agreement that Europe needs to create an industrial policy for a more sustainable economy. Even if the EU aims at an “economy that works for people” – an economy that is resilient, inclusive, fair, sustainable and innovative[1] – it has so far failed to unlock the potential of sustainable ownership forms that favor sharing and reinvestment. In Europe, a long tradition of more sustainable ownership forms has already contributed to resilience and wellbeing: cooperatives, enterprise foundations, social economy enterprises, have helped Europe weather great financial crises, and ensure inclusion and wellbeing even in difficult times.[2] These ownership forms enable companies to focus on long-term value creation. And yet, many of these entities constantly have to swim upstream: unlike ‘mainstream’ enterprises, they do not enjoy ready-made enterprise forms, or easy access to financing, public and private. In order to create a level playing field for these organizations, while giving Europe a chance to reap the benefits of ownership forms that favor sharing and reinvestment, we call for new industrial policy for a sustainable and social economy.

II. Sustainable Ownership Forms

We call upon the European Union to create an industrial policy which facilitates the emergence and the transition toward more sustainable ownership forms:

a) Steward-ownership, separates economic rights and voting rights over the company, making sure that profits and value created is not distributed among the shareholders but serves the company’s long-term development and purpose (capital or asset lock).[3]  Many successful companies in Europe – such as Novo Nordisk, Mærsk, Carlsberg, Ikea, TBI Holding etc. – are steward owned. In Germany, a new legal form for steward-ownership is a part of the current coalition agreement.[4] While it is crucial that the EU supports national initiatives, internal market concerns may complicate national experimentation. We thus call for the creation of a ‘European non-extractive legal add-on’,[5] a set of European rules that would enable the transition of companies toward a non-extractive ownership model (with a binding and irreversible capital lock), Europe-wide. Such a legal device would provide a credible signal to public institutions and third parties about the long-term orientation of a company and enable the designing of policies around it.[6]

b) Employee-owned enterprises. Based on EC estimates, every year a third of 450,000 enterprises transferred are threatened because of ownership succession challenges. To keep local knowledge and employment, direct technological progress in a labor enhancing direction, boost companies’ performance, reduce layoffs in recessions, safeguard local communities, and achieve other positive social externalities, employee-ownership needs to be made more widely known and there need to be easily available legal templates for workers to acquire their companies.[7] Various models are available, such as the ESOP-model (Employee Stock Ownership Plan), in which workers gradually gain ownership over the company.[8]  The European Union should facilitate thetransition of SMEs to employee-owned enterprises, as was also recommended by the 2018 EP resolution on this issue.[9] Next to creating a legal template, financial support is crucial for successful ESOP’s. This can take the form of loan guarantees, subsidies and fund guarantees.  

c) Public investment must come with public voice. Too often, public investment today only socialises the risks and privatises the benefits, while diverting public investment to shareholders’ pockets. We therefore call on the European Union to make sure that public investment is at least connected to public voice (by having shares held by the state, or otherwise having say over the level of investment and the distributions to shareholders) and to investigate when public ownership is an option. State-owned enterprises (SOE’s), despite widespread prejudice, will, if well–equipped, provide high quality essential services in many sectors. State-owned utilities in the European Union are also more inclined to invest in renewables, promoting the energy transition.[10]

d) Cooperatives: Cooperatives have a tradition dating back into the 19th century in many member states, providing services like housing, affordable food or, more recently, energy. Cooperatives tend to re-invest within their community, providing services where multinational enterprises or the state are less present. In the energy sector, cooperatives make an essential contribution to the energy transition, enhancing citizen involvement and creating legitimacy for renewable energy projects. And yet, cooperative solutions face major obstacles in accessing financing – due to financial regulation or the ‘convenience-seeking’ of banks. The EU should adopt rules to facilitate the financing of housing, energy, food, or workers cooperatives, while also providing (e.g. tax) tools to disincentivise de-mutualisation.

These ownership forms would, together with mainstream companies, provide a more pluralist and resilient ecology of enterprises to facilitate the transition to a more sustainable economy. 

III. (Industrial) Policy Principles facilitating Sustainable Ownership Forms:

While providing the above legal forms and enhancing financing opportunities goes a long way, if Europe truly wants to reap the benefits of sustainable ownership, it should also consider:

a) Using industrial policy tools – subsidies, public procurement, tax breaks, guarantees etc. – in order to promote the adoption and spread of the sustainable and democratic ownership forms identified above. Such ownership forms can also be made more attractive by linking them to efforts to govern the human rights and climate impacts of supply chains (like the CSDDD[11]) or to engage in responsible trade and investment (such as the Critical Minerals Act,[12] but also the Net Zero Industry Act[13]), in order to share the benefits of new technologies and economic activity genuinely with workers across the chain, local communities and developing countries.

b) Strengthening workers’ collective voice in the governance of companies remains crucial for making economy more resilient, innovative and sustainable. Workers voice is crucial to maintain local knowledge and ownership, keep companies in local communities, increase job security (not only during recessions), and to promote a democratic culture in our companies and societies.[14] The collective rights of information, timely and meaningful consultation, participation and negotiation should be further promoted, at all levels of governance, including for instance by revising and upgrading the European Works Councils Directive 2009/38/EC, following recommendations of the European Parliament, the European Economic and Social Committee and the ETUC on how to congruently reinforce democracy at work in Europe.[15] One forward looking measure would be to promote stronger versions of co-determination, with full equality, at board level, of representatives of workers and shareholders. 

c) European law should not stand in the way of implementation of non-extractive legal forms at the Member State level – especially if no European non-extractive legal forms are provided. The freedom of establishment should be interpreted in a way that it does not undermine national ‘asset-lock’ provisions for non-extractive enterprises, as those are fundamental in order to create credible commitment for the long-term, socially and environmentally sustainable orientation of businesses.

[1] Commission, ‘Building an economy that works for people: an action plan for the social economy’ (Communication) COM (2021) 778 final. 

[2] Ibid. 

[3] Purpose foundation, Steward-Ownership Rethinking Ownership in the 21st Century (Purpose Foundation 2017) <>

[4] Anne Sanders, ‘Binding Capital to Free Purpose: Steward Ownership in Germany,’ European Company and Financial Law Review 19, no. 4 (2022) 622–53.

[5] These can be inspired by the French ‘Loi Pacte ‘ but developed in a truly non-extractive direction.

[6] Commission, ‘Building an economy that works for people: an action plan for the social economy’ (Communication) COM (2021) 778 final.

[7] Douglas Kruse, ‘Does employee ownership improve performance?’ (2022) IZA World of Labor  <

[8] David Ellerman, Tej Gonza, and Gregor Berkopec, ‘European Employee Stock Ownership Plan (ESOP): The Main Structural Features and Pilot Implementation in Slovenia,’ (2022) SN Business & Economics 2, no. 12, <> 

[9] European Parliament resolution of 23 October 2018 on the role of employee financial participation in creating jobs and reactivating the unemployed (2018/2053(INI)). 

[10] Bjarne Steffan, Valerie Karplus and Tobias S. Schmidt, ‘State ownership and technology adoption: The case of electric utilities and renewable energy‘ Research Policy 51, Issue 6 (2022) <>; David Hall, Emanuele Lobina and Philipp Terhorst, ‘Re-municipalisation in the early twenty-first century: water in France and energy in Germany,’ International Review of Applied Economics 27, Issue 2 (2013) 193-214 <>

[11] Commission, Proposal for a Directive on Corporate Sustainability Due Diligence and amending Directive (EU) 2019/1937, COM (2022) 71 final. 

[12] Commission, Proposal for a Regulation establishing a framework for ensuring a secure and sustainable supply of critical raw materials and amending Regulations (EU) 168/2013, (EU) 2018/858, 2018/1724 and (EU) 2019/1020, COM (2023) 160 final.

[13] Commission, Proposal for a Regulation establishing a framework of measures for strengthening Europe’s net-zero technology products manufacturing ecosystem (Net Zero Industry Act), COM (2023) 161 final.

[14] Isabelle Ferreras, Firms as Political Entities. Saving Democracy through Economic Bicameralism (Cambridge, Cambridge University Press, 2017); Isabelle Ferreras, Julie Battilana, and Dominique Méda, Democratize WorkDemocratize Work. The Case for Reorganizing the Economy(Chicago, The University of Chicago Press, 2022), <>; De Spiegelaere et al. (2019) Democracy at Work, in ETUI/ETUC (eds) Benchmarking Working Europe, ETUI:Brussels;  Han Kim, et al. ‘Labor representation in governance as an insurance mechanism,’ Review of Finance 22 (2018) 1251–89 <>; Jäger, Simon, et al. ‘What does codetermination do?’ ILR Review 75 (2022)  857-890 <>. 

[15] European Parliament (2021) Resolution ‘European framework for employees’ participation rights and the revision of the European Works Council Directive’ of 16 December 2021 <>; European Economic and Social Committee (2023) Exploratory opinion ‘Democracy at work’ adopted on the 27 April <>;  ETUC (2016) Position paper ‘Orientation for a new EU framework on information, consultation and board-level representation rights’ <>

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