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The Win-Win of Employee Ownership

by | Jul 11, 2023 | General | 0 comments

Employee Ownership is an increasingly popular business model that has the potential to provide an immense benefit to employees and employers alike. It encourages employee engagement, helps to foster a sense of responsibility, and has the power to create a positive working environment. In this blog post, we’ll discuss the win-win of Employee Ownership and how it can be a great tool for both employees and employers.

What is Employee Ownership?

Employee owned businesses are totally or significantly owned by their employees.

The economic contribution of employee ownership in the UK is significant and is growing. Employee owned businesses achieve higher productivity and greater levels of innovation and are more resilient to economic turbulence. They also have more engaged, more fulfilled and less stressed workforces.

Employee ownership can take one of three forms:

Direct employee ownership – using one or more tax advantaged share plans, employees become registered individual shareholders of a majority of the shares in their company; Indirect employee ownership – shares are held collectively on behalf of employees, normally through an employee trust; Combined direct and indirect ownership – a combination of individual and collective share ownership.

Benefits of Employee Ownership for Employees

Employee owned businesses are totally or significantly owned by their employees.

The economic contribution of employee ownership in the UK is significant and is growing. Employee owned businesses achieve higher productivity and greater levels of innovation and are more resilient to economic turbulence. They also have more engaged, more fulfilled and less stressed workforces.

Benefits of Employee Ownership for the Business

There are many benefits that businesses can experience when they choose to implement employee ownership. For example, in the UK manufacturing sector, employee ownership has been shown to be a highly effective model for business growth. Here are some of the key benefits:

  1. Improved performance: Employee ownership can help to create a culture of shared responsibility and accountability, which can drive improved performance across the business. Employees have a vested interest in the success of the company and are motivated to work harder and smarter.
  2. Increased innovation: Employee ownership can also encourage greater innovation and creativity within the company. When employees have a stake in the business, they are more likely to share their ideas and suggestions, leading to new products, services and processes that can help to drive growth.
  3. Higher employee satisfaction: When employees are owners of the business, they tend to be more satisfied and engaged in their work. They have a greater sense of pride and ownership in what they do, and this can translate into better customer service and higher quality products and services.
  4. Attract and retain talent: Employee ownership can also be a powerful tool for attracting and retaining talent. Companies that offer employee ownership can differentiate themselves in a crowded marketplace, and can attract employees who are looking for more than just a pay check.

Overall, employee ownership can be a powerful driver of business growth and success. By empowering employees and creating a culture of shared responsibility and accountability, businesses can improve performance, increase innovation, boost employee satisfaction, and attract and retain top talent

Steps to Implementing Employee Ownership

The number of employee owned businesses in the UK is growing and interest in employee ownership is thriving.

Most organisations in the UK that become employee owned are assisted by the EOA to explore employee ownership. We help individuals and organisations to choose the right model and brokers visits to leading employee owned businesses and introductions to the EOA’s approved specialist advisors.

We help you to plan not just for a transition, but an EO transformation that delivers benefits for both individuals and the business.

The move to employee ownership can be straightforward with the right advice and support to find the best model for you. It’s important not to get bogged down in the technical details of legal and financial implementation but to keep the bigger picture in mind and the longer term legacy you want the business to create for employees and customers.

Whether you’re a company owner, employee, business adviser or work in a public service, the EOA is best placed to offer guidance and advice on helping you find the best model for your route to employee ownership.

Find out more about Employee Ownership

If you’re interested in exploring the benefits of employee ownership further, the Employee Ownership Association (EOA) is a great place to start. The EOA is a UK-based organization that helps individuals and organizations to understand and explore employee ownership. They offer a range of resources, events, and support to help you navigate the process of transitioning to employee ownership.

One of the EOA’s flagship programs is the EO Accelerator Programme, an intensive two-day introduction to employee ownership. This program is designed to provide business leaders and entrepreneurs with the knowledge and tools they need to implement employee ownership in their own organizations.

Employee buy-outs are becoming an increasingly popular business succession option for company owners. There are many benefits to this approach, including increased employee engagement, improved productivity, and a more stable and sustainable business model. Finance is now readily available for those looking to make the transfer to employee ownership, making this an accessible and viable option for many businesses.

In addition to supporting private sector businesses, the EOA also works with public sector employers considering spinning out to an employee owned public service mutual. This approach has been successful in a number of areas, including UK Manufacturing and business growth, and has led to increased innovation, better customer service, and improved employee satisfaction.

If you’re interested in finding out more about employee ownership, the EOA is a great place to start. Their website offers a wealth of resources and information on this topic, as well as details of upcoming events and training programs.