Dr Francesco Pierangeli examines why European businesses don’t reward employees with stock/share options, and what they might be missing out on as a result.
European universities train exceptional engineers, scientists, and researchers whom European businesses then compete to retain. Yet, when these specialists help build valuable technologies, they are usually employees rather than owners of the businesses. This raises a question that goes beyond remuneration: who should share in the value that highly skilled employees create?
In a recent article for MIT Technology Review Italia, Mark Esposito, Gianni Orlandi and I argued that ownership is one of the most overlooked differences between European and more dynamic tech ecosystems.
In the US tech sector, equity has become standard compensation. Stock options and share plans give employees a direct financial stake in the companies they are helping to build, and in many firms, this extends well beyond senior management. The principle is simple: if an engineer helps develop a product, a researcher contributes intellectual property, or an early employee helps turn an idea into a successful company, salary rewards their labour today, while equity allows staff to share in tomorrow’s value that they help create. This distinction is very important for start-ups, university spinouts, and deep-tech firms that face long development cycles, limited early revenue, and an inability to compete on corporate salaries alone.
Broad equity gives employees a direct stake in long-term success, and aligns them with company goals by giving them “skin in the game”.
Some European employees do hold shares, but participation varies considerably between countries. Fragmented tax rules, reporting requirements, and corporate regimes mean a single employee share plan faces conflicting regulations across borders.
Who receives the equity is another issue. Italy illustrates the gap: according to the Annual Economic Survey of Employee Share Ownership in European Countries in 2025 (EFES, 2026), employees hold 3.8% of company capital – slightly above the European average of 2.92%. Yet around 81% of Italian employee equity is concentrated among top executives, compared to 43% across Europe as a whole.
This gap matters. Giving shares to senior management is merely an incentive scheme; extending ownership across the workforce is something more ambitious. Broad equity gives employees a direct stake in long-term success, and aligns them with company goals by giving them “skin in the game”.
None of this means that equity should replace fair salaries, good working conditions or responsible management. Shares also carry risk, and poorly designed schemes can simply transfer more of that risk onto workers. But well-designed employee ownership complements these foundations, boosting retention and letting innovators share in the value they create.
For responsible business, how value is distributed matters just as much as how it is created.
Assistant Professor of Finance
Francesco's interests include Game Theory, Economic Development and Innovation in Financial Markets.
