More employee ownership is essential for economy and society in post-Brexit UK
From when the Industrial Strategy Green Paper was launched and then as the snap election prompted manifestos from the main three parties, I have not hidden my disappointment that they do not fully acknowledge the role Employee Ownership plays and the impact it could have in supporting the UK economy.
In the Conservative manifesto, the party announced its plans for representation of workers on company boards. Whilst these plans may force listed companies to either create stakeholder advisory panels, designate an existing non-executive director as the employee representative, or directly appoint a worker representative to the board, these commitments are some way behind what the economy needs.
As employees continue to bare the brunt of excessive executive pay in their own remuneration packages, whilst trust in business continues to be at an all time low, and when it is becoming ever clearer that the economy is set to face considerably harder times following the decision to leave the European Union, what the economy needs now is a radical rebalancing and a renewed focus on the 5.5m independent, privately owned businesses of the UK.
As it is these businesses, which with the absence of external shareholders, are able to develop more innovative, flexible and responsive models of working which can adapt to the changing needs of a local, domestic or global economy.
Over 300 of these businesses in the UK are already working in a way which engages employees at every level in the organisation; which represents the employee voice in strategic decision making; and which gives due recognition to the contribution of every employee with a fairer approach to reward.
This not unsubstantial sector of the economy employs 200,000 people, contributes £30bn annually and comprises over 300 businesses, is characterised by many of the traits that the UK is desperate to develop; leaders who take a long term view of investment; greater financial and operational resilience; and higher levels of profitability and productivity.
It is attractive to employees for obvious reasons; higher levels of engagement; more sense of satisfaction and pride; and higher levels of retention. And finally it is what our regional economies need; businesses that are rooted in local supply chains; businesses that seek to deliver social as well as economic impact; and independent minded, innovative workplaces that put people first.
At a time when the UK needs a different approach, the next government must look to employee ownership as a model that can deliver more for the UK economy.
With this in mind I have been making it known directly with policy makers and also in the media what I feel the employee ownership sector needs from the new government after the June 8 election.
To enable employee ownership to become a more important part of the UK economy, the next government must deliver in four key areas:
• Acknowledge the economic value of a thriving employee ownership sector, the performance of the sector, and its potential contribution to the wider economy by ensuring employee ownership is embedded in UK economic policy
• Highlight the distinction between ‘The Quarterly Economy” and the economic benefits of longer-term business strategies as a key driver of an improved economic infrastructure by being firm and brave in the reform of Corporate Governance.
• Ensure banks, other financial institutions and the accountancy sector act more responsibly and inclusively in regards to their ability to support and advise their clients about employee ownership.
• Commit to capacity building that will enable the employee ownership sector to create more awareness, drive more demand, build professional capacity, and to deliver more support to more fledgling and would-be employee owned businesses around the UK.
Employee ownership delivers a business structure and culture characterised by traits and features which UK businesses of all types will need more than ever if they are to capitalise on the opportunities and overcome the challenges of a new economy.
The next government can make a bold statement of its commitment to helping UK businesses to thrive and prosper by ensuring that employee ownership is prioritised in its future economic policy.