Employees around the world get proceeds from earnings annually from millions of dollars of H&M stock.
To encourage employees’ long term employee involvement with the company, the internationally successful Swedish clothing retailer H&M (Hennes & Mauritz) is giving 4,040,404 of its public stock shares, which have an estimated worth of $137 million, to the firm's own workers in all its divisions around the world.
“The idea is to create a long-term incentive program which is the same for all employees. Our hope is that employees will be able to benefit from H&M’s value growth in the same manner as a shareholder,” stated Stefan Persson, Chairman of the Board, who is Sweden’s second richest individual after Ikea founder Ingvar Kamprad.
H&M also hopes that the measure, which is based on the amount of time worked with the company and unrelated to position or salary level, will benefit future recruitment during H&M's major global expansion. Payouts to workers will being in 2011, and all their employees around the world who have worked for the company for at least five years are eligible.
Donated in early September by the Persson family - H&M's major shareholder with 37% of the stock and 70% of the voting rights - the funds are being transferred to a newly established Swedish foundation, Stiftelsen H&M Incentive Program. The company intends to make future contributions to the foundation equivalent to 10% of the increase in share 12 month dividends.
Hennes & Mauritz was established in Västerås, a city in central Sweden, in 1947 by Erling Persson, the grandfather of its current CEO, Karl-Johan Persson. Following after the American based Gap and the Spanish based Inditex, H&M is today the world's third largest fashion chain, and it has more than 2,000 retail outlets in some 35 nations.
Number 13 and the richest Swede on Forbes list: Stefan Persson (H&M), all smiles at the store opening at Lexington and 59th Street, Manhattan, New York in 2004. Photographed by Catarina Lundgren Åström
Stefan Persson at the store opening in New York with then CEO Rolf Eriksen left, who was replaced by a third generation Persson, Karl-Johan Persson, in early 2009. Photographed by Catarina Lundgren Åström