Scotland is a country of ground-breaking innovation. Whether nurturing positive change in technology or practice, it does so with an invigorated spirit. But we can do more.
Scotland has the opportunity to become a pioneer in employee ownership, paving the way for hundreds of businesses to embrace and benefit from the model. “Employee ownership” is often associated with retail heavyweight John Lewis. Assumptions can be made that only companies of that size and scale can successfully adopt the scheme but that’s simply not true.
Here in Scotland we’ve done exactly that. We are creating a place where 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 – they own the company.
Employee ownership is not just a soft corporate culture tactic – it boosts hard figures too. According to 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 per cent 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 per cent every year. Employee-owned companies currently make up 3 per cent of the UK’s GDP and advocates hope to increase that number to 10 per cent by 2020.
Despite these impressive figures, setting-up an employee owned company is still very much trial and error due to low awareness of the business model and the lack of readily available information. This is where the Scottish Government can step in. 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 supporting the establishment of an Institute for Mutual and Employee Ownership are critical to its adoption.
Ultimately, a company’s success is down to its people and it should be all staff, not just a select few, who enjoy the fruits of their labour.