EOA Member News – Five Welsh Firms Switch To Employee Ownership in 2020
Five Welsh firms transitioned to the Employee Ownership model in 2020, in a move that is part of a growing trend that will continue to gain traction in Wales, according to some of the leading experts in the field.
This year saw the Employee Ownership model being adopted by an increasing number of firms in Wales including BIC Innovation, Wavehill, Heron House Financial Management, Lorax Ltd (Heinie Haynes) and Arfon Timber.
Paul Cantrill from the Employee Ownership Wales team at Social Business Wales, which provides fully-funded Employee Ownership help and advice, said: “Congratulations to BIC Innovation, Wavehill, Heron House Financial Management, Lorax Ltd (Heinie Haynes) and Arfon Timber on making the transition to Employee Ownership. To have five companies in Wales transition during this last year alone shows how the model is becoming an increasingly popular option for ownership succession and is less complex than people think.
“It is interesting to see the broad spread of businesses and sectors that are now looking into transitioning to Employee Ownership. We are seeing increased interest from all avenues as it is becoming a business model that can be tailored to fit all kinds of sectors and all sizes of businesses.”
With Wales and the wider UK adjusting to economic shifts brought about by the Covid pandemic, many business experts are increasingly making the case for Employee Ownership and how it will bring about greater businesses resilience and wider economic stability in the long-term.
Mr Cantrill continued: “It is very clear that firms in Wales are very much focused upon building back better, and the Employee Ownership model lends itself to this. We are, of course, also seeing Brexit on the horizon, with the end of the transition period coming at the end of this month, and, I think firms in Wales are making moves to ensure their businesses are well-structured, able to operate in a balanced, efficient way and that they are protecting the future of their firm, brand and workforce.
“Employee Ownership will undoubtedly become even more prevalent in the coming year and we will follow the progress of the five Welsh firms that have transitioned in 2020 with great interest.”
There are different levels and styles of Employee Ownership, from share options to selected members of staff to the employees or a trust owning 100 per cent of the company. Most Employee Ownership arrangements see more than 50 per cent of a company’s shares transferred to the staff, typically done by an entrepreneur or family-owned businesses. The Employee Ownership model also attracts strong tax benefits.
Employee Ownership Wales is a service provided as part of Social Business Wales which has supported more than 50 companies in Wales through the process. It is delivered by the Wales Co-operative Centre and funded by the European Regional development Fund through Welsh Government.