This paper argues that strikes, and pilot strikes specifically, would benefit from being analyzed from an agency theory perspective, as it outlines previously largely overlooked relational aspects between the pilots and the managers, which has led to and will lead to future strikes. For this end, a more extensive literature review was provided, which begun at agency theory and ended in a review of the control mechanism most likely to fix the relational aspects causing the strikes, namely an employee stock ownership program (ESOP). The literary points identified were further illustrated and applied to the SAS pilot strikes in 2016 and 2019, which represents some of the most profound pilot strikes in recent history. From the case illustration the paper determines that agency theory is useful in analyzing strikes, as it outlines the structural reason for them to be non-aligned interests, asymmetric information and asymmetric risk profiles between the pilots and the firm. As such, the paper also identifies that ESOP could provide a valuable structural change through providing stock ownership and increased decision-making rights to the pilots, which could more closely align the financial and psychological interest, as well as reduce the risk and information asymmetry between the pilots and the firm. Hence, the contribution of the study is to clearly identify the main structural reasons for pilot strikes through analyzing them from an agency theory perspective, and further connecting these to the benefits achievable through the implementation of ESOP as presented by authors of different academic fields.
|Educations||MSc in Accounting, Strategy and Control, (Graduate Programme) Final Thesis|
|Number of pages||100|