Private equity giant KKR's antidote to worker discontent — employee stock ownership programs

cnbc.com:

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The job market may be strong, but the invisible strings that connect workers to their jobs are increasingly weaker. 

Trends such as "lazy girl jobs" and «quiet quitting» have gone viral in a post-pandemic world where young workers are trading ambition for balance. Actors and writers continue to strike. UPS workers were on the brink of one before reaching a tentative agreement with their employer. More than half of employees in a recent survey reported feeling burned out due to a demanding workload. 

How would all of that change if there were greater economic alignment between employers and their employees? If employees had more so-called «skin in the game?» 

That's the rhetorical question that Pete Stavros finds himself constantly asking. As the co-head of global private equity at KKR, he's been a key champion of instilling employee stock ownership programs in all the companies the firm buys for its $19 billion Americas Fund.

These are effectively additional benefits, doled out to the rank-and-file – outside traditional management stock plans. Employees are given a stake in the company they're employed by; it's additional compensation above their regular wages and benefits, so that they can participate in any upside value the company delivers. 

«So why should people do this? It's because it's just a superior way to run a business from every respect,» Stavros said in an interview for the Delivering Alpha Newsletter. «It's better for investors, it's better for the company, it's better for employees, and in the end, it's better for the communities that they live in.» 

The latest deal, announced this week, involved RBmedia, a KKR-backed audio-books publisher