DEBATE EMPLOYEE OWNERSHIP
IN ASSOCIATION WITH:
PRESENT: Richard Slater Lancashire Business View (Chair)
Richard Few Sales Geek
Mathew Haslam Hardscape
Joanne Kimber Granby Marketing
Shakira Musarat Barclays
Jenny Pape Azets
Mairead Platt Brabners
Oliver Smith Employee Ownership Association OWNING THE FUTURE
The Covid pandemic has made business owners take a long, hard look at their future. One result is a rising interest in employee ownership - giving the workforce a vested interest in the company’s future success. We brought our expert panel, including business owners who have been down the route, to the offices of Granby Marketing in Blackburn to discuss the opportunities it opens up
Oliver Smith: Any business owner should be thinking about the next stage of the business, whether they should be involved in it or not, and employee ownership should be a consideration. It’s now becoming mainstream as a viable option for business succession.
There are two needs. There are the needs of the business owner and then the wants and the needs of society. Society wants to see a better form of doing business. It wants to create equity.
Employee ownership creates the legacy for the individual who can drive past the office or factory in five or ten years’ time and say, ‘I created that and it is still going. The people I know are still working there and that is because of what I did.’ Employee ownership, for the right people, can undoubtedly be the right thing for them and for society as well.
One of the things that has made such an impact is the awareness of employee ownership. The sector’s grown massively over the past four years or so. Covid has made a big impact. There are now more than 1,200 businesses that are employee owned and there are more and more transitions every single day.
Employee ownership is not philanthropic. There are still many commercial reasons why it works and it should never be perceived as, ‘Giving away my business. I’m gifting it to my employees. It’s totally generous.’
No, there are great financial reasons why this can be done, for the sellers, for the vendors, for those taking over the business and the local economy as well. It should not be perceived as philanthropic.
Shakira Musarat: With family businesses people may think they’d like the next generation
to come in, or to go a certain way and then things evolve and that’s not exactly how things turn out. The next generation may not be interested or they are not suitable. You might have thought there was a natural management succession but that is not quite right. So, you need to look at everything. It is managing how things change and evolve as well as your priorities.
If you are looking at equity, how much control you want to give away will depend on the investor you choose. There are those that will take a minority stake, or you could go for private equity that will take a majority stake. How much direction, how much external influence are you prepared to take? In terms of strategy what are the priorities of the people that are going to come in and if you are still going to be a shareholder what does that mean for you? That is quite a difficult challenge for business owners.
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