Thursday 14 July 2022

10 Years of Employee Ownership (EO) Day – What We Have Learned

Photo by Windows on Unsplash

{This is a collaborative post} 

It has been an entire decade since the Employee Ownership Association launched EO Day, or ‘Employee Ownership Day’, in celebration of the benefits of employee-owned businesses.

There are, of course, a lot of benefits to celebrate. It is clear that, within the UK, there are strong economic benefits being felt not just by the individual employees themselves, but by the business and regional economies. It’s also clear to see that employee ownership represents one of the cornerstones of preparing for a future of increased automation and using artificial intelligence to streamline significant portions of the UK workforce.

In all likelihood, businesses opting to spread ownership throughout the economy are something we should see a lot more of over the coming years. But, to that end, what has happened already?

Businesses are ready and willing to explore the benefits

Since 2019, the employee ownership sector has doubled – a fact which is testament to just how ready shareholders and directors are to spread ownership and reap the benefits of a workforce that have a much more significant stake in the business – and its growth – than they did before.

This has been aided by the formation of the Employee Ownership Trust, or EOT, first established in 2014. Recent research into employee ownership in SMEs has already paved the way for further studies into the true extent of the benefits brought by employee ownership.  

Businesses that take on employee ownership are generally thought to be directed toward more meaningful roles and relationships 

One of the strongest examples of this stems from the impact of Covid-19, which coincides with the rapid surge in companies turning toward employee ownership. As everyone was forced to confront their own mortality – and the impacts of a global crisis – more businesses and advisors sought to instate strong succession plans for their business, and to create a meaningful path forward not just for the business itself, but for its employees, too.

Employee ownership gives employees a more meaningful say in the business, which tends to have a strong impact on their levels of happiness and satisfaction at work.

The emphasis on nurturing the workforce is very strong

A recent survey showed that 96% of employee-owned businesses say that looking after the workforce is key to the success of the business, and more than two-thirds claimed that employee ownership was a matter of social responsibility.

Obviously, as with any significant change to the business, there will inevitably be a period of ‘settling in’ as everyone gets to grips with the new order. For that reason, and despite the strong rewards waiting for businesses who can navigate this process, working closely with corporate solicitors on setting up or running an employee-owned business can only help as they have worked with similar clients and know how to handle a change of this proportion.

There are, of course, a variety of ways to instate employee ownership within a business, but utilising the EOT has proven to be the most popular so far, and is well worth exploring if you’re interested in your employees having a stake in the future of your business. 

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