EOA backs calls to rebuild business for society

The EOA has backed a call from the Building Societies Association to support a call for meaningful change in the institutions that shape the business environment.

Currently, funding and awareness raising for business support is disproportionately skewed to just a few types of business models, when a wider focus could see growth in the plurality of business models with a benefit to the economy and society.

The Rebuilding Business for Society report–compiled by a group of co-operative and mutual trade associations–says they can play a leading role in reinvigorating communities, especially those left behind by economic or social change.

“The Covid pandemic has brought out the best in people and their communities, and we need to facilitate the development of institutions that embrace this spirit,” said Mike Regnier, Chief Executive of the Yorkshire Building Society and Chair of the Building Societies Association.

“By building on their heritage of democratic ownership, cooperatives, mutual, employee-owned firms and social enterprises can integrate communities and play a leading role in securing a more sustainable economic, social and environmental future for all.”

The group is calling for “meaningful change” in the institutions that shape the business environment in order to counteract the dominance of shareholder-ownership in the way the corporate world is structured.

Three key approaches outlined in the report include:

  • Creating an enabling environment for forms of business ownership beyond shareholder owners
  • Providing an option for businesses that are seeking to recapitalise after the Covid pandemic to introduce employee or customer ownership, including repaying Government support out of future earnings
  • Supporting community-led economic development, particularly in the hardest-hit regions, to engage local people in incubating new forms of wealth creation which would support the Government’s ambitions to “level up” different regions.

David Sproxton, Co-founder, Aardman Animations, speaking on behalf of the EOA, said: “As the co-founder of an employee owned business, I welcome this report. I see first-hand on a daily basis the benefits of employee ownership in our workforce. The employee owned model has provided security for our colleagues, allowed us to retain our creativity and talent and has kept good jobs rooted in our local economy.

“As we look to recover from COVID, we need to a grow the number of inclusive business models that offer better resilience and income in equality. The Government must support this shift if it wants to level up the economy, and the Comprehensive Spending Review is an opportunity to unlock more purposeful businesses like Aardman Animations, right across the country.”

The Association of Financial Mutuals represents insurance and healthcare providers that are owned by their customers or established to serve a defined community.

“Many employees feel incredibly vulnerable at the moment, as a result of isolation, stress and future uncertainty.  Our research shows that employees in a mutual believe their employer is more trustworthy and focused on customers and the wider community, and those are aptitudes that are increasingly important today.” Jane Nelson, CEO, Oddfellows

Co-operatives UK is the national association of co-ops of all shapes and sizes, from major customer-owned retailers, to worker-owned tech start-ups and community businesses.

“The world needs a new normal for doing business; one that effectively avoids environmental and social harms, while distributing wealth and power more fairly. Because of how they are owned and run, mutuals lead the way, as this report shows.”  James Wright, Policy Lead, Co-operatives UK 

The EOA and Coops UK has called for support for intervention working in the regions to grow employee and worker ownership – you can read the policy suggestion and pledge your support here.