Tomorrow (Thursday, July 4) marks the UK’s first Employee Ownership Day.
Employee-owned companies currently make up 3% of the UK’s GDP and advocates hope to increase that number to 10% by 2020.
The phrase “employee ownership” is usually associated with retail heavyweight John Lewis. Assumptions can be made that only companies of that size or proportion can successfully adopt the scheme.
But that’s simply not true.
We’ve done exactly that. Now we don’t house hundreds of products under one roof or employ thousands of people across the country, but we do endeavour to create a place people feel valued, invested and passionate about where they work.
Employees don’t just have an emotional stake in the company. They have a financial stake too. Everyone from the director to the engineer to the office manager shares in its successes.
In order to attract skilled recruits, achieve our growth plans and encourage employee engagement, we decided to be 100% employee-owned. Everyone benefits from the company’s achievements, which encourages staff to do their best. When it comes to making decisions it also has an impact on the company because everyone’s opinions are heard and valued.
The benefits for us are endless not least of all is improved staff retention. But our success is shared.
According the Employee Ownership Association, employee owned companies have withstood the test of economic turmoil. In 2012, despite the on-going financial crisis, the growth rate of employee owned businesses was 50% higher than the UK economy. Since the Employee Ownership Index began in 1992, employee owned companies have outperformed FTSE All-share companies by an average of 10% every year.
Research by the Baxi Partnership and the Employee Ownership Association also showed that employees are dedicated to their company and more satisfied with their jobs, resulting in a good corporate culture. Hard work, enthusiasm and loyalty are rewarded by substantial shares and an influential voice in the running of the company.
There’s been no better time than now for the road to employee ownership to be simplified and made more accessible. Ensuring the legal, tax and regulatory information on how to become employee owned is conveniently available and establishing an Institute for Mutual and Employee Ownership are critical to its adoption.
Employee ownership has the potential to set a company apart in a crowded, marketplace. Ultimately, a company’s success is down to its people and it should be all staff, not just a select few, who get to enjoy the fruits of their labour.