CEO Blog: Employee ownership; if not now, when?
‘United we stand, divided we fall’ describes the collaboration that unites people to overcome difficult times.
Currently what unites all of us is that as a global community, we all have first-hand experience of how the pandemic has changed the way we live, work and play.
Whilst some yearn for a return to ‘normal’, many long for a ‘new’ normal that celebrates what has been learnt in lock-down; more local and responsible consumerism; less use of cars and more use of bikes (or legs); adapting our homes to suit working from home – or even consideration of a move from cites; and through enforced absence, the real value of family and friends.
However, for many people, this ‘new normal’ is not one to be celebrated. It brings redundancy, the end of a business they created, reduced wages and financial pressures, overcrowding in homes not designed for lock-down living, hunger, homelessness, educational challenges and reduced job prospects for a generation of young people, domestic abuse and for some, the loss of loved ones.
Whilst the pandemic has been global, its long-lasting impact will not be universally felt, as the inequalities across society, communities and regions are revealed and laid bare. For many, there is a sense of helplessness, of having no say and no power and of having very much being economic victims of the pandemic, regardless of whether they have endured the illness itself.
Therefore those in power need to reveal their ambition to ‘build back’ in a way that addresses these inequalities, rather than allowing a return to ways of doing business that makes individuals and the economy vulnerable to future difficulties, simply because that is the easiest thing to do or is being supported by the loudest and most powerful voices.
It is time for our politicians and policy makers to set aside political differences, and unite to build a new, sharing economy.
In the US, both major political parties are united in support of broadening employee ownership – something that the NCEO, our cousins from across the pond, hailed as being key to both addressing the huge wealth gap which has an increased relevance in the current crisis.
A sharing economy will exist when employees benefit from more wealth through their efforts at work, businesses and the regions in which they are based become more financially resilient and sustainable and where there is greater economic empowerment across the entire economy through broader ownership and shared responsibility.
A UK solution which meets this challenge and would have cross-party support is the introduction of broad based employee ownership on an industrial scale across the economy, as we outline in the EOA response to the Comprehensive Spending Review.
With our partners Cooperatives UK, we evidence how the current policy landscape shows a not-so-United Kingdom – while Scotland is leading the way with policy and support for the growth or employee and worker ownership, and Wales now has similar political support, England lags behind. However, we are armed with a compelling solution for which we are currently building a test case in one region.
Employee and worker ownership enable every employee in a business to have a shared stake in its success, combined with the opportunity to have a representative say in it and their future. It provides the means to motivate discretional effort, drive higher performance and productivity, develop more inclusive governance and spread wealth more fairly.
In addition to being tested and proven across the UK economy pre-pandemic – with more than 500 businesses and 200,000 employee owners in the UK – this is now the business model which can help to address the challenges that our post-pandemic economy needs to address (as identified in the recent reports by EOA partner Ownership at Work); how to support the cash flow in struggling SME’s as they emerge from the pandemic; how to share wealth more widely and support struggling communities to build back stronger; and how to create a more productive post-pandemic economy through stronger leadership.
‘Once in a lifetime’ is an often-cited phrase, however, there is no better way to describe what the UK now faces. This really is THE opportunity to make a long lasting, positive change in the economy, to enable more people to have a stake and a say, not just in the business in which they work, but in their long term economic future.
Employee ownership; if not now, when?