As we approach the end of another year, it’s always good to pause and look back on what the last 12 months have brought. It’s been a busy time for Co-operative Development Scotland and for the sector. We’ve caught up with the team to see what their highlights for the year have been.

National Strategy for Economic Transformation

One of the key developments for the sector this year came when the National Strategy for Economic Transformation (NSET) was published in March 2022. This ambitious and transformational vison for Scotland’s economy, places the concept of a wellbeing economy at the heart of the strategy. Critically, it recognises the role inclusive models such as employee ownership and co-operatives can play in this. This has led the Scottish Government to undertake a review of how best to significantly increase the number of social enterprises, employee-owned businesses and co-operatives to support regional regeneration and the wealth of local communities.

It’s an exciting time to be working in the sector as the value of these models and their potential gain more recognition.

 Community Wealth Building

The Scottish Government has committed to bringing forward community wealth building legislation during its current term. Community wealth building (CWD) prioritises local creation and distribution of wealth and will play a key part in delivering the far-reaching change proposed by NSET. The approach comprises a framework of five pillars, one of which is plural ownership, corresponding directly to CDS’ mission. This focus on community wealth building has provided an opportunity to improve regional engagement and we look forward to playing a key role in CWD delivery in 2023.

 Employee Ownership Census and Employee Buyouts

The Employee Ownership Census Scotland was published by CDS in March 2022, revealing there were 195 employee-owned businesses (EOBs) at the end of March 2022, including 28 workers co-operatives. Of these, 146 are Scottish-registered, boasting a combined turnover of £691m while employing more than 5,350 people. Since March, the numbers have continued to grow to over 200 EOBs operating in Scotland. Scotland has set itself the ambitious target of creating 500 EOBs by 2030 but the sector has demonstrated resilience in difficult times. Last year we commissioned a survey that found 53% of EOBs experienced steady or increased turnover during the pandemic, compared to just 20% of non-employee-owned businesses. Scotland is the third top region in the UK for employee ownership and, given the challenges created during the pandemic, the landscape in Scotland is still positive.  

The new EOBs announced this year include a diverse mix of companies and we are pleased to have been able to support so many of them. Shuttle Busses, a Kilwinning-based company, became employee-owned, giving all 70 employees a stake in the business as the current MD plans for his eventual retirement. Glasgow-based online retailer, The Executive Shaving Company also opted to embrace employee ownership with all staff taking a stake in the business.  Esteem Training Limited, a provider of vocational training for leading Scottish construction and civil engineering companies transferred into an Employee Ownership Trust (EOT) to reward the contribution of its dedicated staff, safeguarding jobs while ensuring that ownership of another successful independent, growing business remains in Scottish hands. And interest is continuing to grow. Our advisors are busy as more and more clients explore the option of employee ownership, and we expect the number to continue to grow significantly throughout 2023.

Support for Co-ops

2022 saw a significant shift in how we support co-operatives. In response to feedback from clients and stakeholders around their needs and the challenges faced, we have developed our support offer. We are now able to extend our services to both new and established organisations and we are taking steps to proactively raise awareness and support a wider variety of models such as platform and worker co-ops. We anticipate both to be growth areas in the coming years. We have already run our first event in the area of platform co-ops in collaboration with Co-ops UK and look forward to hosting more events in the new year.

We also had the pleasure of working on the Worker Co-op Gathering alongside Green City Wholefoods, Media Co-op and the new federation. The Worker Co-op Gathering facilitates the meeting of like-minded people who work in or are interested in worker co-ops to find out more about this way of working and access support. 

Employee Ownership Events

CDS delivered 3 ‘Selling your business’ masterclasses in 2022 featuring employee-owned companies Swanson Food Wholesalers, chartered accountants Reid and Fraser, Rubric, Tangram Furnishers, Turnberry Rugworks and Auchrannie Resort. These events are vital in raising awareness of employee ownership as a succession solution and help business owners decide whether an employee buyout could work for them.  The final masterclass in the current series takes place on 8 February 2023 featuring employee-owned Quantics. 

January, February and March 2023 will see us hosting 3 employee ownership webinars aimed at professional advisers. The webinars will focus on the legal aspects of the employee ownership transaction, the employee ownership landscape and view of the future, and the accountant’s input to the EOT transaction.  Guest speakers include Graeme Nuttall OBE, Fieldfisher, Bruce Farquhar, Anderson Strathern and Linzi Wilson, Consilium Chartered Accountants.

In partnership with The EOA, we have developed a series of
bespoke learning workshops available to all employee-owned businesses with operations in Scotland. Taking place in March 2023, these free of charge workshops are designed to introduce the key principles of good employee ownership, known as ‘Good EO’, that will support employee-owned businesses to develop and embed an effective employee culture.  Topics include; Governance – The role of the Trust Board and Trustees, Leadership – Empowering Leadership and Engagement & Comms – Representing & Developing Employee Voice. 

Also in early 2023, we are planning a employee ownership learning journey to a range of employee-owned companies in the North East of Scotland.  The final itinerary is being finalised, however if you would be interested in attending, please register your interest.

Podcast Series

Our podcast series continues to be extremely popular. As part of our Reset and Rebuild series we welcomed, Isle of Eigg, Brewery, Community Shares Scotland and Jangling Space to discuss the potential of co-operative business models. Network ROI shared their experience of employee ownership, Co-ops UK provided an overview and discussion around Platform Co-ops and Social Investment Scotland joined us to look at support and investment in social enterprises. 

The EO Podcast

As the growth of employee ownership continues to accelerate, we added 6 new episodes to our employee ownership podcast series, The EO Podcast. The series aims to raise awareness of the wide-ranging benefits that employee ownership can offer those considering a move to the model. The new episodes include guest speakers from employee-owned Woollard & Henry, VME Coop, Paul Heat Recovery Scotland, i4 Product Design, Heatherlea and Chemco International. 

As 2022 draws to a close, we are aware of how challenging 2023 will be. As the cost of living and the cost of doing business crises take hold, we know many of our clients will be operating in an exceptionally difficult environment.  Messages of inclusive models development and a wellbeing economy may not resonate when survival is the priority.

However, challenges bring opportunity, and co-ops and employee-owned businesses are proven to be resilient and critical to communities in times of difficulty so we look forward to continuing our work to support the sector to grow, shining a spotlight on the value it brings, and ensuring CDS contributes effectively to the delivery of NSET throughout 2023.