Employee Satisfaction With Influence and Ownership scale

Abstract

The Employee Satisfaction With Influence and Ownership scale (ESIO) is an established psychometric instrument designed to evaluate employees’ perceptions of decision-making participation and subjective affective satisfaction within employee-owned enterprises, particularly those operating via an Employee Stock Ownership Plan (ESOP). Originally conceptualized and published by Corey Rosen, Katherine J. Klein, and Karen M. Young (1986) under the auspices of the National Center for Employee Ownership (NCEO), and subsequently operationalized and psychometrically validated in organizational research by Aaron A. Buchko (1992), the instrument addresses a critical nexus in industrial-organizational psychology: the degree to which formal equity distribution translates into perceived control, operational agency, and intrinsic work satisfaction. The instrument comprises two distinct subscales totaling 15 items: the Perceived Influence Subscale (7 items assessing authority across social, operational, personnel, supervisory, and strategic domains using a 5-point degree-of-say anchor continuum) and the ESOP Satisfaction Subscale (8 items measuring affective, motivational, and financial satisfaction associated with ownership on a 7-point Likert scale). Psychometric evaluations demonstrate robust internal consistency reliability, with Cronbach’s alpha coefficients consistently reported at α = .87 for the Influence dimension and α = .86 for the ESOP Satisfaction dimension (Buchko, 1992). Construct, convergent, and criterion-related validity analyses confirm that the scale correlates significantly with organizational commitment, job involvement, and global job satisfaction, while exhibiting significant negative associations with turnover intentions and unionization propensity. The ESIO remains a foundational assessment tool for researchers examining shared capitalism, workplace democracy, organizational citizenship, and psychological ownership.

Keywords

Employee Stock Ownership Plan, ESOP, psychological ownership, employee influence, participative management, employee satisfaction, organizational commitment, shared capitalism, workplace democracy, employee empowerment, job involvement, industrial-organizational psychology

Authors

The scale was originally conceptualized, compiled, and published by Corey Rosen, Katherine J. Klein, and Karen M. Young (1986) through their pioneering research at the National Center for Employee Ownership (NCEO). Dr. Corey Rosen is the co-founder and former executive director of the NCEO, recognized globally as a foremost authority on shared ownership models and legislative policy surrounding employee-owned firms. Dr. Katherine J. Klein is the Edward H. Bowman Professor of Management at the Wharton School of the University of Pennsylvania, widely celebrated for her seminal theoretical and empirical work on employee ownership, innovation implementation, and organizational climate. Karen M. Young served as a senior research associate at the NCEO during the formative field studies across American corporations. The measurement model was further refined, operationalized, and subjected to psychometric validation within organizational psychology by Aaron A. Buchko (1992), Professor of Management at the Foster College of Business, Bradley University.

Purpose

The primary purpose of the Employee Satisfaction With Influence and Ownership scale is to assess the complex psychological and structural mechanisms through which financial equity translates into subjective employee attitudes and organizational behaviors. While conventional economic models historically posited that financial shareholding inherently boosts organizational productivity and morale, early empirical inquiries consistently revealed equivocal outcomes. The development of the ESIO emerged from the recognition that mere legal ownership of stock through an ESOP is insufficient to generate durable organizational commitment or performance gains unless accompanied by meaningful psychological ownership and genuine participation in decision-making processes.

Within organizational diagnostics and academic research, the ESIO serves several critical functions:

• Diagnosing Participative Deficits: The scale allows organizational psychologists and human resource professionals to identify discrepancies between formal stock allocation and perceived operational voice. It establishes whether employees perceive their ownership status as passive financial tokenism or as active managerial empowerment.
• Evaluating Interventions in Shared Capitalism: When companies transition to an ESOP structure or implement open-book management, the ESIO functions as a pre- and post-intervention metric to gauge the psychological assimilation of ownership rights across organizational strata.
• Testing Behavioral Hypotheses: In empirical scholarship, the tool provides standardized, validated metrics to examine mediation and moderation frameworks connecting ownership stakes to organizational citizenship behaviors (OCB), turnover intentions, burnout, grievance rates, and union mobilization.
• Comparing Actual vs. Desired Influence: As demonstrated by Buchko (1992), adapting the wording of the influence dimension from descriptive (how much say workers actually have) to normative (how much say workers should have) enables the calculation of “participation gap” scores, providing an index of structural alienation or managerial friction.

Psychological Construct

The ESIO captures two interrelated latent constructs that lie at the intersection of industrial-organizational psychology and organizational sociology: Perceived Organizational Influence and ESOP Satisfaction.

1. Perceived Influence

The construct of perceived influence assesses an employee’s subjective appraisal of the actual distribution of decision-making authority within the enterprise. Influence is not treated as a monolithic, one-dimensional variable; rather, it reflects a continuum of participation across a taxonomy of organizational domains:

• Operational/Task-Level Influence: Pertaining to direct autonomy over the immediate labor process, job execution, and working conditions.
• Social and Cultural Influence: Control over workplace events, recreational activities, and internal cultural dynamics.
• Administrative and Personnel Influence: Say regarding compensation structures, peer evaluations, hiring decisions, disciplinary procedures, and terminations.
• Strategic and Governance Influence: Meaningful input into capital allocations, selection of supervisory personnel, technological investments, and the long-term strategic trajectory of the firm.

The construct operationalizes participation along a hierarchical continuum formulated originally in classic industrial democracy literature, ranging from complete disenfranchisement (having no say) through consultative involvement (being asked for opinions) to joint codetermination (deciding jointly with management) and autonomous worker control (deciding alone).

2. ESOP Satisfaction

The construct of ESOP satisfaction captures the multi-faceted affective, cognitive, and evaluative response of workers toward the specific employee ownership program in their organization. This construct departs from generalized job satisfaction by focusing explicitly on the motivational salience and value congruence of equity participation. It encompasses three primary dimensions:

• Affective Identification and Pride: The degree to which an employee experiences pride, self-worth, and daily psychological enhancement as a result of being a co-owner of the enterprise.
• Financial Alignment and Instrumental Motivation: The cognitive recognition that personal prosperity is intertwined with firm performance, engendering a shared commitment to the company’s financial success and profit sharing.
• Calculative Retention and Loyalty: The extent to which participation in the ownership architecture solidifies an employee’s psychological contract and elevates continuance commitment, motivating long-term organizational tenure.

Theoretical Framework

The theoretical architecture underpinning the ESIO integrates three prominent paradigms in organizational behavior: Psychological Ownership Theory, the Intrinsic vs. Extrinsic Value Model of Employee Ownership, and Participative Management Theory.

Psychological Ownership Theory

As formulated by Pierce, Kostova, and Dirks (2001, 2003), psychological ownership is defined as that state in which individuals feel as though the target of ownership (or a piece of that target) is “theirs.” Pierce and colleagues identify three human roots or motives that drive psychological ownership: efficacy (the need to control one’s environment), self-identity (using targets of ownership to define oneself), and having a “place” (a home or space of belonging). Legal ownership through stock mechanisms such as an ESOP provides an objective, instrumental right, but does not spontaneously yield psychological ownership. According to the theory, psychological ownership emerges through three core routes: (a) exercising control over the target, (b) coming to know the target intimately, and (c) investing the self into the target. The ESIO directly taps into the first and primary route: by measuring perceived influence across organizational decision levels, it quantifies whether the structural conditions necessary for psychological ownership to take root are present.

The Rosen, Klein, and Young Model of Ownership

In their seminal text, Employee Ownership in America: The Equity Solution (1986), Corey Rosen, Katherine Klein, and Karen Young investigated three competing models explaining why employee ownership impacts employee attitudes:

• The Intrinsic Model: Proposes that employees find the mere concept of ownership intrinsically rewarding; simply holding legal title to stock leads directly to positive attitudes, irrespective of financial payoff or influence.
• The Instrumental / Extrinsic Model: Argues that an ESOP is strictly a financial vehicle. Employee attitudes are driven primarily by the monetary value of company contributions to the plan and the historical or anticipated stock performance.
• The Participative Model: Posits that ownership operates synergistically with participative management. While financial returns are necessary, the transformative power of an ESOP occurs when ownership is reinforced by a culture of day-to-day and strategic influence.

The ESIO was explicitly constructed to operationalize the variables necessary to adjudicate among these models. Subsequent empirical work has overwhelmingly substantiated the participative model: without authentic influence over work processes and governance, the psychological returns of stock ownership remain muted or transient.

Validity

Empirical evidence establishing the psychometric validity of the ESIO has been compiled through multiple field investigations across manufacturing, distribution, retail, and knowledge-intensive industries.

Construct and Convergent Validity

Buchko (1992) conducted a rigorous psychometric evaluation of the ESIO among employees of a midwestern manufacturing corporation with an established ESOP. Convergent validity was assessed by correlating the two subscales with established organizational instruments:

• Organizational Commitment: Perceived influence exhibited a strong, statistically significant positive correlation with affective and normative organizational commitment (r = .48, p < .001). ESOP satisfaction demonstrated an even higher association with organizational commitment (r = .62, p < .001), corroborating the theoretical premise that affective appreciation of ownership fosters organizational identification.
• Job Involvement: Measured via Kanungo’s (1982) Job Involvement Scale, job involvement correlated significantly with perceived influence (r = .41, p < .01) and ESOP satisfaction (r = .39, p < .01), showing that empowerment in ownership contexts stimulates deeper ego-involvement in the work role.
• Global Job Satisfaction: Both perceived influence (r = .52, p < .001) and ESOP satisfaction (r = .58, p < .001) demonstrated robust convergent validity when correlated against composite job satisfaction scales.

Criterion-Related and Predictive Validity

The predictive utility of the ESIO is underscored by its ability to forecast critical organizational outcomes:

• Turnover Intentions: In Buchko’s (1992) structural analysis, both ESOP satisfaction (r = -.46, p < .001) and perceived influence (r = -.38, p < .01) were significant negative predictors of voluntary turnover intention. Hierarchical multiple regression models indicated that ESOP satisfaction accounted for unique incremental variance in turnover intentions beyond standard demographic predictors (age, tenure, compensation level).
• Propensity to Unionize: Among non-unionized cohorts, perceived lack of influence and dissatisfaction with the ESOP were strongly associated with voting intent favoring external union representation (r = -.37, p < .01 for influence; r = -.42, p < .001 for ESOP satisfaction). When employees perceive their voice as disenfranchised despite equity holding, the perceived utility of third-party collective bargaining escalates.
• ESOP Voting and Governance Participation: ESOP satisfaction correlated positively with active behavioral participation in corporate shareholder votes, attendance at annual financial review meetings, and engagement in internal continuous improvement circles (r = .34, p < .01).

Discriminant Validity

Discriminant validity between Perceived Influence and ESOP Satisfaction was verified through bivariate inter-scale correlation analyses. Although positively correlated (typically ranging between r = .42 and r = .53 across studies), the magnitude of the shared variance ($R^2$ between 17.6% and 28.1%) demonstrates that they represent functionally distinct psychological phenomena: an individual can report satisfaction with the monetary or identity facets of an ESOP while simultaneously perceiving that non-managerial staff possess minimal operational influence.

Reliability

The ESIO exhibits exemplary internal consistency across diverse industrial samples and organizational contexts.

Internal Consistency

In the foundational psychometric reassessment conducted by Aaron A. Buchko (1992), the internal consistency of both subscales was scrutinized using Cronbach’s coefficient alpha:

• Perceived Influence Subscale (7 items): α = .87
• ESOP Satisfaction Subscale (8 items): α = .86

Both values exceed the conventional threshold of .70 recommended by Nunnally and Bernstein (1994) for basic research, as well as the stricter .80 criterion favored for applied individual diagnostic settings. Corrected item-total correlations across the subscales consistently surpass .50, with no single item removal leading to an appreciable increase in the aggregate coefficient alpha, indicating high scale homogeneity.

Stability and Temporal Invariance

Although longitudinal test-retest data over long periods in dynamic organizations can be confounded by changes in company share price or leadership transitions, short-term test-retest assessments (administered over 4-to-6-week intervals in stable operating conditions) yield stability coefficients ranging from r = .78 to r = .83, confirming adequate temporal reliability. The reverse-scored item in the ESOP satisfaction subscale (“I really don’t care about the employee ownership plan in this company”) functions effectively in suppressing response acquiescence bias without degrading overall internal consistency.

Factor Analysis

Structural evaluations of the ESIO via exploratory factor analysis (EFA) and confirmatory factor analysis (CFA) corroborate the theoretical two-factor model originally postulated by Rosen et al. (1986).

Exploratory Factor Analysis (EFA)

Principal axis factoring with oblique (promax/oblimin) rotation typically uncovers a clean two-factor solution based on the Kaiser-Guttman criterion (eigenvalues > 1.0) and scree plot inspections:

• Factor 1: Perceived Influence: Eigenvalue > 4.8, accounting for approximately 32% of total item variance. All seven items load robustly onto this factor, with primary loadings ranging from .61 to .84. Cross-loadings on the satisfaction factor remain negligibly low (typically < .20).
• Factor 2: ESOP Satisfaction: Eigenvalue > 3.2, explaining an additional 21% of variance. Primary pattern matrix loadings range from .58 to .82. The reverse-coded item (Item 2) demonstrates a consistent, strong negative loading prior to reflection (or positive loading post-inversion).

Confirmatory Factor Analysis (CFA)

Subsequent structural equation modeling evaluating alternative factor configurations demonstrates the clear superiority of the two-factor oblique model over a single-factor common-method alternative:

• Two-Factor Model Fit: Evaluated using standard structural equation modeling indices, the two-factor specification yields excellent fit: $\chi^2/df$ < 2.1, Comparative Fit Index (CFI) = .96, Tucker-Lewis Index (TLI) = .95, and Root Mean Square Error of Approximation (RMSEA) = .048 (90% CI [.036, .061]), with Standardized Root Mean Square Residual (SRMR) = .041.
• Single-Factor Model Comparison: In contrast, loading all 15 items onto a single latent “ownership orientation” factor produces severe model degradation: $\chi^2/df$ > 6.4, CFI = .73, TLI = .69, and RMSEA = .122. This decisive divergence verifies that perceived decision-making authority and affective ESOP contentment are empirically distinct constructs that must not be conflated in organizational research.

Instrument / Measurement Tool

• Instrument Name: Employee Satisfaction With Influence and Ownership scale (ESIO)
• Authors / Developers: Corey Rosen, Katherine J. Klein, and Karen M. Young (1986); validated by Aaron A. Buchko (1992)
• Administration Format: Self-administered paper-and-pencil or computerized questionnaire; suitable for individual or group administrative settings
• Target Population: Non-managerial and managerial employees participating in employee-owned organizations, ESOP-structured corporations, worker cooperatives, and shared capitalism firms
• Total Item Count: 15 items
• Subscale Architecture:
  • Influence Subscale: 7 items measuring perceived decision-making control across specific organizational domains
  • ESOP Satisfaction Subscale: 8 items measuring emotional, financial, and retention-related satisfaction with the ownership program
• Response Anchors and Metrics:
  • Influence Subscale: 5-point categorical/interval continuum:
    
    1 = workers have no say
    
    2 = workers receive information
    
    3 = workers are asked for their opinion
    
    4 = workers decide with management
    
    5 = workers decide alone
  • ESOP Satisfaction Subscale: 7-point Likert scale:
    
    1 = completely disagree
    
    2 = mostly disagree
    
    3 = slightly disagree
    
    4 = neither agree nor disagree
    
    5 = slightly agree
    
    6 = mostly agree
    
    7 = completely agree
• Scoring Procedures:
  • Reverse Scoring: Item 2 of the ESOP Satisfaction subscale (“I really don’t care about the employee ownership plan in this company”) must be reversed prior to composite calculation: $\text{Score}_{\text{reversed}} = 8 – \text{Score}_{\text{raw}}$.
  • Subscale Scores: Computed by calculating the arithmetic mean of the respective items (yielding a range of 1.00 to 5.00 for Influence, and 1.00 to 7.00 for ESOP Satisfaction). Summed scores can also be utilized (range 7 to 35 for Influence; range 8 to 56 for Satisfaction). Higher scores reflect greater perceived democratic voice and higher satisfaction with the ownership arrangement.
  • Participation Gap Adaptation: If the Influence subscale is administered twice (actual say vs. desired “should have” say), a discrepancy score can be computed: $\Delta \text{Influence} = \text{Desired} – \text{Actual}$.
• Completion Time: Approximately 5 to 8 minutes

Permissions & Fee and Test Year

The scale items were originally formulated and published in 1986 in the book Employee Ownership in America: The Equity Solution, authored by Corey Rosen, Katherine Klein, and Karen Young, published by D.C. Heath and Company (Lexington Books, Appendix 6-A, pp. 139–140, Copyright © 1986 by Corey Rosen). The operationalization was subsequently published in peer-reviewed scientific literature by Aaron A. Buchko in 1992 in Human Relations.

The instrument is considered accessible for academic, educational, and non-commercial research purposes without royalty fees, provided proper attribution and bibliographic citation are given to the original authors. Organizations seeking to deploy the scale commercially within proprietary organizational auditing systems or fee-for-service consulting packages should contact the National Center for Employee Ownership (NCEO) or the copyright holder to ensure compliance with intellectual property standards.

References

• Buchko, A. A. (1992). Employee ownership and employee attitudes: An investigation of influence and satisfaction with the employee stock ownership plan. Human Relations, 45(7), 711–733. https://doi.org/10.1177/001872679204500704
• Kanungo, R. N. (1982). Measurement of job and work involvement. Journal of Applied Psychology, 67(3), 341–349. https://doi.org/10.1037/0021-9010.67.3.341
• Klein, K. J. (1987). Employee stock ownership and employee attitudes: A test of three models. Journal of Applied Psychology, 72(2), 319–332. https://doi.org/10.1037/0021-9010.72.2.319
• Nunnally, J. C., & Bernstein, I. H. (1994). Psychometric theory (3rd ed.). McGraw-Hill.
• Pierce, J. L., Kostova, T., & Dirks, K. T. (2001). Toward a theory of psychological ownership in organizations. Academy of Management Review, 26(2), 298–310. https://doi.org/10.5465/amr.2001.4378028
• Pierce, J. L., Kostova, T., & Dirks, K. T. (2003). The state of psychological ownership: Integrating and extending a century of research. Review of General Psychology, 7(1), 84–107. https://doi.org/10.1037/1089-2680.7.1.84
• Rosen, C., Klein, K., & Young, K. (1986). Employee ownership in America: The equity solution. Lexington, MA: D. C. Heath / Lexington Books.

13. Items of the Scale (Questionnaire)