How can that be true? When a shareholding employee leaves, including when they are fired for cause, does the former employee get to keep the stock and continue receiving dividends until the they choose to sell the stock to someone else, who may or may not be an employee? If not, then the employees are not actually shareholders, it's just a bonus system.
> Huawei’s employee ownership claim is untrue because its employees have no control over the trade union’s decisions, the paper says citing China’s Trade Union Law. The employees actually hold “virtual stock” which allows for participation in a profit-sharing scheme, which are canceled when an employee leaves the company and allow no voting rights over the company, it said.
(I am neither for nor against the company and have no skin in the game)
What's the difference?
High finance & legals are sophisticated. Stocks and bonds are ultimately contracts and if you're not trading them on a market with standards, they can be written however you want. You can have bonds with all the practical implications of stock and the reverse. Voting rights and fixed interest. No voting rights, but with dividends, etc.
If Huawei wants to redefine that then we have to evaluate what a corporation is and what is even means to be an "owner" of such a thing.
This however makes for quite a big difference. How the hell do you sell the damned things? If you accrue many "shares" what's to stop you being fired to nullify them?
Hard to see these as valuable without a secondary market and maybe with no liquidity at all...
There is a degree of incompatibility between employee ownership and how we think about equity in traditional companies. This isn't to say that selling the company needs to be impossible, but it may only be possible with collective decision making rather than individual shares being easy to buy and sell as they are on a public stock exchange.
The problem I see with Huawei in this case is less to do with being able to treat your ownership share as an easily fungible asset and more to do with the fact that it appears the employees do not have effective control over the company. i.e. they don't get a say in who's on the board, financing decisions or anything like that. If employees through a fair, democratic system effectively have sovereignty over what the company does (and there's no one with a massive ownership stake to veto them hanging around) then you have some semblance of legitimate employee ownership.
The buy-back mechanism isn't great either, if that is how you want it to work then it should be based off of a fair and independent valuation of the company which it appears that it isn't.
I also think it's unlikely that an employee owned company could have the kind of control over the company that it should have when it's operating from a literal dictatorship.
And you know, even this is all assuming that this article is accurate and not just a FUD think-piece to support the American government's stance on the company, having not really done a great deal of independent research on Huawei myself.