10 things to consider when embedding your employee ownership culture globally | EOA Big Read
Employee owned businesses with international operations have shared examples of how they go about embedding their employee ownership culture with staff not based in the UK.
Here, three of our members highlight lessons learnt and challenges faced, and share their tips for ensuring EO is embraced and understood among employees based overseas.
To help EO businesses thinking about expanding globally – but nervous around acquiring or starting international operations and embedding their EO culture – we wanted to showcase how businesses of different sizes, with different employee ownership models, go about this in a practical and operational context.
Employee owned businesses sharing insights
- Scott Bader: The manufacturer of advanced composites, structural adhesives and functional polymers has 815 employees and an indirect EO model. Global Members’ Board (GMB) Chair Sam Boustred provides an insight into its operations. Northamptonshire-based Scott Bader has sites in France, Spain, UAE, Ireland, Canada, USA, Germany, China, South Africa, Sweden, Croatia, Czech Republic, Japan, Australia, Italy, and India.
- Glide: The body, chaired by Michael Hodgson, represents employees who work in its partner companies of Sheffield-based Gripple, Loadhog and Go Tools, which have a direct ownership model where employees buy shares. Glide has around 1,100 employees, with operations in France, Poland, Germany, Italy, USA, India, Japan, and Australia. Most of these are Gripple sites, which is a manufacturer of wire joining and tensioning devices.
- Aber Instruments: The Aberystwyth company has a portfolio of systems in use in the brewing, biotech, biorenewables, and biofuel industries. Aber has a hybrid EO model, with 55% of shares in trust and the rest in share incentive plans (SIP) and via direct ownership. HR Leader Emma Thomas showcases an example of a smaller business of 80 employees, five of which are in its US subsidiary in Washington DC.
We have collated insights from interviews with Sam, Michael and Emma to create 10 tips of what to consider when embedding your employee ownership culture in new or existing operations globally.
1. Governance structures
Scott Bader and Gripple, as larger companies, both have boards with full-time chairs on which employees from their international operations sit as regional reps, ensuring decision-making “doesn’t become UK focussed”.
Glide has 50 representatives based on the number of shareholders in each region – with five reps from the US and six in Europe, for example. Michael says that “it’s about people seeing Glide reps on their site, but also the rep getting a feel for the business”.
Like Glide, the GMB at Scott Bader ensures employee voice globally is heard, acted upon, and at the heart of everything it does. It is made up of elected reps evenly spread from all its sites. It also has local councils on sites where there are 50 or more employees.
2. Send someone over
Gripple and Aber Instruments have had “real success” sending people from their UK businesses to set up international operations. When Aber set up its US subsidiary in 2017, a member of the team relocated to start that operation. Emma says that person “lived and breathed” the Aber ethos and so was able to “champion and replicate our employee ownership culture from the start”.
This has also become a “key, tried and tested principle” for Gripple. Whenever new subsidiaries have been set up, it has taken someone with an “inherent understanding” of its values, who’s been in the business a long time, to go and set these up so that its EO culture is replicated.
Sam from Scott Bader visits global sites himself as often as he can, saying “you need to see it, feel it and make sure they’re getting the essence”.
3. Visits to the UK
Glide sees real value in flying reps over three times a year for board meetings in Sheffield. Michael says this helps reps “feel our employee ownership culture” and share successes and challenges with others from around the world, to then take these learnings back.
Aber ensures new employees come over to the UK to spend at least two weeks embedded within the organisation “living, breathing and feeling it”. Emma says this has been fundamental and as the business continues to grow, it will continue to do this so that employees really feel connected.
4. Embed values across processes
At Glide, the onus is on ensuring its EO culture and values set is “front and centre”. It embeds these values across all its recruitment and training processes, leadership programmes, performance management and appraisals, so people “understand it’s a big part of how they act in our business day to day”.
Aber, equally, says it “aligns everything that we practice, so nobody feels different, everyone feels the same”.
5. Review how you’re doing regularly
Sam says Scott Bader used to be a UK company with lots of small subsidiaries overseas, but in the last couple of years the balance has tipped as it has acquired more businesses and now it has more employees outside the UK.
This change in dynamic “has needed a bit of care and a bit more focus”, and so Scott Bader has undertaken a review to ensure everyone “shares a common purpose and common processes”.
6. Make communication a priority
“How you share information comes up all the time in employee ownership, it’s so important,” says Michael from Glide. He stresses the need to have a consistent framework implemented globally for how and what you communicate, and to link everything back to employee ownership to “help people really understand its value”.
At Aber, the issue of operations in different time zones has led to a greater focus on how and when it communicates. Meeting times have changed to ensure employees in Washington and California are always included to “make sure we have a cohesive way of working so that we’re collaborative and cooperative all the time”.
7. Hearing all global voices
To be “more aware of all 815 people we represent rather than just the big sites”, Scott Bader has set up regional forums to ensure employees have a voice at sites which don’t have a large manufacturing hub.
“You’ve got to be clear of the channels where communication comes through,” Sam says. “You’ve got your management line or your board representative line, but that isn’t going to cut it for everyone, so we’ve made sure there is this extra way of getting through to different people.”
He also says it’s important to “understand your audience”. For example, Microsoft Teams helps to connect with people who work in Scott Bader’s offices, but in South Africa a lot of employees don’t speak English or access to a computer isn’t as easy, so it has to be “a bit more hands on”.
8. Understand cultural differences
Emma at Aber says the difference in culture can be a challenge or create barriers, and the business is “mindful” that sometimes terminology doesn’t align when you’re communicating. “I wouldn’t underestimate the culture variants between the countries you’re working in and understanding how that can knit with your employee ownership culture,” she says.
Sam says they place a big onus on making sure the “Scott Bader standard” cuts through so that everyone feels empowered to speak up. He cites the “big difference culturally” between colleagues in its different sites, such as the union involvement in its different French regions, to the more passive employee culture like in Dubai.
9. Legislation and benefits
Aber says the biggest lesson it learnt was understanding the differences in legislation and the employment market in the US. The company’s hybrid EO model also brings its own set of challenges, especially when it comes to benefits.
Aber can have a SIP share scheme in the UK because of government rules, but employees can’t have that in the US. They do still get a dividend payment for their share ownership, profit share through the Trust, and get gifted 1,000 shares after probation. Because it doesn’t have aligned benefits packages, US employees are provided full health care as it’s common to provide in the US.
10. ‘Big Mac’ dividend
The Scott Bader Commonwealth was set up as a charity when the company was given away for free in 1951. Under its constitution, 60% of the profits must remain in the company, up to 20% can be given as a dividend, and whatever it gives to employees is matched as a charitable donation.
Employees across the globe are invited to join the Commonwealth after 12 months of service. When it comes to paying a dividend, Scott Bader has an unusual method for working out how much people receive.
It looked at “more grown-up ways” of working this out, but found the ‘Big Mac Index’ has been most effective in ensuring employees have the same purchasing power with the dividend they get – which boils down to how many Big Macs you can buy in a country.