Roles of Employee Representatives

Trade unions are the most usual example of employee representation in corporate governance. Trade unions represent employees in a work facility such as an office or a plant. Membership is voluntary and the influence of the union is usually proportional to its proportion of membership.


Although a trade union is by default assumed to have an adversarial role with management, its ability to ‘deliver’ the compliance of a workforce can help significantly in corporate governance. When an external threat is faced, such as with the reputation losses following the 1970s leak, then the coalition of workforce (via Forward Together) and management meant that it was more difficult for external critics to gain support.


A trade union is an actor in the checks and balances of power within a corporate governance structure. Where management abuses occur, it is often the trade union that is the first and most effective reaction against it and this can often work to the advantage of shareholders or other owners, especially when the abuse has the ability to affect productivity.


Trade unions help to maintain and control one of the most valuable assets in an organisation (employees). Where a helpful and mutually constructive relationship is cultivated between union and employer then an optimally efficient industrial relations climate exists, thus reinforcing the productivity of human resources in the organisation. In defending members’ interests and negotiating terms and conditions, the union helps to ensure that the workforce is content and able to work with maximum efficiency and effectiveness.




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