The Benefits of Employee Ownership

There’s a good reason why the UK’s employee ownership sector is enjoying rapid growth. Evidence shows EO brings enormous benefits to businesses, employees, and the wider economy. It's a win-win for everyone. 

Research shows that:

  • Employee owned businesses (EOBs) are more profitable, efficient, and resilient
  • Staff are happier, more productive, and better paid
  • Staff are much more committed when they have a meaningful stake and a say
  • EOBs are more firmly rooted in their local communities for the long-term – jobs stay in your local area
  • Staff contribute to better governance and improve the decision-making in the business

EO also has wider benefits:

  • EOBs are more sustainable and have more ethical practices
  • They currently deliver up to £42bn a year to the UK economy
  • Employees provide an outsize contribution to the economy, making up 01% of the current workforce but contributing 0.8% to the economy

With EO, employees perform better because they have access to the things that make them happier at work – health, wealth, and participation. Sounds great, right?  

Plus, through employee ownership, business leaders have access to a smart model where people can establish a true voice whilst sharing in the business’ success. 

For Employees

Employee ownership offers employees a meaningful stake and a say in their workplace. They’re also consistently happier, more productive, and take greater pride in their work.  

Higher, fairer pay 

As well as having a higher minimum annual wage, EOBs are also more than twice as likely to be a Living Wage Employer and hold other fair pay and reward accreditations. 

Access to bigger bonuses 

For anyone looking for a bigger bonus, an EOB is the place to be. Here, bonuses are almost twice as large.  

Happier, more engaged employees 

Most EOBs boast increased employee engagement and motivation since adopting an EO model, as well as increased job satisfaction. 

Increased investment in training & skills 

There’s plenty more opportunities for on-the-job training and developing at EOBs, with businesses typically spending more on skills development.  

Greater financial and wellbeing support 

Financial wellbeing support, one-off bonus payments, and salary sacrifice schemes are commonplace at many EOBs. They’re also more likely to offer flexible hours, remote work, and support career breaks.

For the Business

Employee ownership helps increase profit, productivity, resilience, and innovation at a business. It’s no wonder EOBs are, on average, more successful than their counterparts.  

More profit, greater efficiency 

Most EOBs reported increased profits since becoming EO, and EOBs are more likely to have seen profits increase in the last five years. 

More productive 

EOBs are significantly more productive than their counterparts.  

Greater resilience

From the pandemic to supply chain crises, EOBs have consistently risen to the challenges the economy has thrown at them, retaining more stable profits, sustaining investment levels in their products and services, and being less likely to make employees redundant. 

More innovative 

EOBs are more likely to have increased investment in R&D in the past 5 years. 

Improved recruitment and retention 

Great talent is more attracted to EOBs, while businesses themselves boast lower staff turnover rates on average.  

For the Economy and Society

The EO sector is small but mighty, and it’s growing fast. As it grows, the benefits EOBs bring to the economy and society will continue to expand. The more employee owned businesses, the greater the benefit.  

A disproportionate impact on the economy 

EOBs currently deliver up to £42bn a year to the UK economy, making up 0.1% of the current workforce but contributing 0.8%. 

Doing more to get to Net Zero 

Regardless of size, EOBs are more likely to have a net zero or carbon management strategy in place.  

Working towards a greener economy 

EOBs are more likely to prioritise management time and focus on helping achieve positive environmental impacts. 

More environmentally sustainable 

EOBs are more likely to have environmental sustainability accreditation, such as Planet Mark, B Corp, or ISO.  

Giving back to the community 

EOBs go further in supporting and promoting the resilience of their local communities. They’re consistency more likely to make charitable donations. In fact, they give over £500m more per year than their counterparts. They’re also significantly more likely to provide community support, such as advocating on behalf of local community causes, and more than twice as likely to offer volunteering days to staff.