Why without value sharing, there is no social justice

Value-sharing schemes play an active role in both building and eroding social justice in the workplace. Our report takes a closer look at corporate profit-sharing mechanisms. Tying in with World Day of Social Justice (February 20, 2026), our report “Value Sharing Mechanisms: From Optional to Indispensable?” examined the main mechanisms through which companies share value. Businesses play a central role in either strengthening or eroding social justice. On World Day of Social Justice, we tend to assume that justice primarily depends on laws, institutions, and major political decisions. Yet an increasing share of contemporary injustice is created or corrected much closer to home: in the way companies choose to share the value they generate. In OECD countries, the share of labour income in national income has been declining in favour of capital owners. According to a report by the International Labour Organization (ILO), globally (including OECD countries), this share has fallen by 1.6 percentage points since 2004, reaching 52.3% in 2024. This represents a $2.4 trillion shortfall for workers in that year alone. Income inequality and even more so wealth inequality has widened. Top earners continue to pull ahead while lower-income groups see their conditions deteriorate. The World Inequality Report 2026 indicates that in 2025 the richest 10% captured 53% of total income (compared with 8% for the poorest 50%). In terms of wealth, the imbalance is even greater: the richest 10% hold 75% of global wealth, compared with just 2% for the poorest half of the population. In France, the poverty rate has reached a record 15.4%, illustrating the gradual erosion of social cohesion driven by these macroeconomic trends. In this context, value-sharing mechanisms within companies, profit-sharing schemes, shareholding, training, well-being programmes, and more democratic governance are becoming essential levers of social justice. This raises a fundamental question: even if a company can retain most of the value it creates, should it and with whom should that value be shared? The risk of conflict and reputational damage The report which we conducted with Nil Aydin, 2024 HEC Paris graduate, highlights the troubling consequences of failing to share value. It reviews controversial cases involving globally recognised companies such as Amazon, Walmart, McDonald’s, Uber, and Tesla, which have been criticised for low wages, unsafe working conditions, or reliance on precarious employment arrangements that deprive workers of basic social security cover. These are not one-off communication crises. They reveal a structural pattern: when labour is treated merely as a cost to be minimised and employees are forced to absorb shocks such as inflation or rising productivity pressures alone, companies expose themselves to social conflict, reputational risk, and regulatory backlash. Research cited in the report shows that replacing disengaged employees can cost up to 150% of an annual salary. By contrast, approaches based on value sharing, which strengthen loyalty and engagement, help stabilise the workforce and overall performance. What may initially appear to be an “economic” strategy, compressing wages and benefits quickly becomes costly when strikes, litigation, and consumer boycotts follow. Ten times more wealth for employee shareholders Value sharing relies on a growing set of tools that organisations around the world are beginning to adopt. First, this can take the form of profit-sharing schemes, which allocate a portion of company results to employees, either through bonuses or retirement savings contributions. Studies conducted in the United States show that such mechanisms are associated with productivity gains of 3.5% to 5%, particularly in small businesses – demonstrating that sharing the pie can also make it grow. Secondly, employee ownership, particularly through Employee Stock Ownership Plans (ESOPs). These mechanisms allow employees to become co-owners of their companies. According to research cited in our report, in the United States employees nearing retirement in ESOP companies hold, on average, ten times more wealth than those in comparable firms without employee ownership. These companies are also three to five times less likely to lay off workers during economic downturns. Thirdly, non-monetary mechanisms. Skills development, wellbeing and recognition initiatives are powerful – and often underestimated – forms of value sharing. Investing in training expands employees’ capabilities and future opportunities, echoing Amartya Sen’s concept of development as the expansion of human freedoms. Comprehensive well-being policies, such as those implemented by Google, including mental health support and sports facilities, improve both employee well-being and productivity, as research on the link between happiness and economic performance suggests. Value sharing can also extend across the entire value chain: fairer contracts with suppliers, local hiring practices, community initiatives, or inclusive pricing policies. Governance: Who gets to decide? At its core, value sharing raises a deeply political question: who has the authority to decide how the fruits of economic activity are distributed? For more than half a century, Milton Friedman’s doctrine The Social Responsibility of Business is to Increase its Profits provided a clear answer. Under this view, corporate governance should primarily serve shareholder interests, provided that the company complies with the law. Today, however, this vision appears increasingly untenable. Edward Freeman’s stakeholder theory, often referred to as stakeholder capitalism, argues that since value is co-created by multiple actors, governance structures should incorporate their voices in decision-making. Concrete proposals include: • employee representation on boards, as in European codetermination models, • stakeholder advisory councils, • or even board seats reserved for environmental NGOs to represent the interests of nature and future generations. The goal is not to exclude shareholders, but rather to rebalance their role within a broader community of legitimate beneficiaries. At the same time, innovations in ownership models are gaining visibility. In Denmark, foundation ownership structures hold significant stakes in companies such as Carlsberg, using dividends to finance scientific and cultural initiatives while ensuring stable, long-term governance. In Spain, the Mondragon Group operates as a federation of worker cooperatives in which employees are both owners and decision-makers, benefiting from greater job security and higher wages than in comparable firms. Moving towards a new social contract Regulation is accelerating this shift. With the Corporate Sustainability Reporting Directive (CSRD) and other frameworks, sustainability is becoming an issue of transparency, risk management, and accountability. Publishing indicators on carbon emissions or diversity will no longer be enough. The next frontier may be a company’s ability to share value more fairly, more transparently, and in a more innovative way than its competitors, and create value through more just production systems. Each time World day of Social Justice comes around it may be tempting to expect governments to correct inequalities. But if social justice is to be taken seriously, we must also look to the companies that structure employment, income, consumption, and social cohesion. Whether they like it or not, businesses now find themselves on the front line of a new social order. In a world marked by declining labour income shares, rising living costs, and eroding trust, value sharing should move to the centre of public debate. It is one of the clearest tests of our economies’ ability to build prosperity that goes hand.

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Schneider Electric is a partner of HEC Paris' Inclusive Economy Center.