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20/20 PROJECT MANAGEMENT JOINS SCOTLAND’S GROWING EMPLOYEE OWNERSHIP SECTOR

The UK’s leading specialist provider of project management training, 20/20, is one of the latest Scottish businesses to announce its transition to employee ownership, with 20 employees becoming owners.

The project management and project controls training company delivers courses and consulting services throughout the world from its Aberdeen base.  It works with major names across a range of sectors including BP, Centrica, Transport for London, BAE, Rolls Royce and AMEC, as well as a range of public sector organisations, and has an annual turnover of £3million.

An Employee Ownership Trust (EOT) has been formed and holds 61% of the shares on behalf of the employees with the option to acquire the remaining shares in the future.

Becoming an employee-owned company has been a positive step for 20/20, with the board of directors deciding it was the right move to enable the engagement of the employees to effectively take the business through its long-term goals.

We caught up with founding director Tony Marks to find out more about the decision.

Mr Marks said:  “Initially employee ownership was considered as part of 20/20’s succession planning strategy, and after I attended a succession masterclass run by Co-operative Development Scotland the benefits became very apparent and the plans to make it a reality came into action.

“We had developed a future leaders programme with the eventual aim of preparing some of our staff to oversee business operations.  Myself and two fellow directors were the three main shareholders in the business and we still hadn’t resolved the issue of realising the value of our individual shares.

“Hearing first-hand about the process and experience of becoming employee-owned really helped us understand the potential benefits, and we agreed it was an effective solution to our succession issues. The prospect of a more engaged workforce and a culture which encouraged greater innovation really appealed to us. We held a team meeting to tell our staff, and the news was very well-received.

“Employee ownership allows myself and my fellow directors to remain in the business as we continue to actively develop our future leadership team, with the knowledge that 20/20’s future is secure. We hope that with a highly-invested workforce, the company will continue to grow and succeed well into the future, with all employees sharing in the rewards.”

Emma Davidson, 20/20’s employee trustee, added:  “The employees see this as a very positive thing and are collectively looking forward to building on 20/20’s business success for years to come.  By becoming an employee-owned company, we feel empowered to create an environment that suits us as a workforce, ultimately increasing our productivity to bring 20/20’s success to the next level.”

20/20 Business Insight of Aberdeen. (back row left to right) Karen Brown, Emma Hart, Jamie Birse, Jacob Bonner, Business Development Director Tom Vincent, and Operations Director Neil Harkin. (front row left to right) Emma Davidson, Service Delivery Director Graham Chapman, Finance Director Mandy Buck,  and CEO Tony Marks. Taken 15-08-18

NEW LEADERSHIP GROUP FOR EMPLOYEE OWNERSHIP – SCOTLAND FOR EO

First Minister Nicola Sturgeon recently announced the establishment of a new industry leadership group which will aim to make Scotland the best country in the world for employee-owned (EO) businesses.

Under the strapline ‘Employees CAN DO Ownership’, Scotland for EO aspires to increase the number of employee and worker-owned businesses from around 100 to 500 by 2030. It will be backed with £75,000 of Scottish Government funding and will be co-chaired by Jamie Hepburn, Minister for Business, Fair Work and Skills.

We caught up with some of the people involved to find out about the reasons behind the establishment of the group.

The First Minister, who revealed the news during a visit to the employee-owned Auchrannie resort on Arran, said:

“All the evidence tells us that employee ownership delivers benefits to business performance, the people who work in them and the places in which they are located. This has certainly been the experience of the Auchrannie team in Arran.

“The health of the Scottish economy depends on having a diverse range of business-types and employee ownership clearly has an important role to play in that.

“We want to make it easier for companies and workers to find out more about this model and to move towards it if it’s right for them. Scotland for EO will help to make this into a real option for businesses across Scotland.”

John Clark, chair of employee-owned business Novograf and member of the steering group behind the initiative, described how the group aims to cultivate the perfect environment for further growth in Scotland’s employee ownership sector.

“We have a choice: to be passive and allow the development of a support environment for EO companies to happen without industry input, or to take a proactive approach and seek to actively influence how that environment evolves. We believe the proactive approach creates the prospect of making Scotland the best country in the world to establish and grow an EO business.”

Evidencing the increasing popularity of EO in Scotland, Co-operative Development Scotland director Sarah Deas concluded:

“The appetite for employee ownership has never been greater. In the last five years the number of employee and worker owned businesses operating in Scotland has trebled and this past year we have been working on a ‘deal a month’ on average.  Our client pipeline is expanding too, indicating take-up of the model will continue to accelerate in future years.

“Promoting employee ownership helps drive growth in the economy and create greater wealth equality in society.”

EMPLOYEE OWNERSHIP PROVIDES PERFECT SUCCESSION SOLUTION FOR PRODUCT DESIGN CONSULTANCY

Edinburgh-based i4 Product Design Ltd is an ambitious Scottish company which was formed in 2003 by four founding directors, Brian Combe, Ewan Maxwell, Gordon Miller and Jim Ward, who went on to build a successful business with a strong track record.  Three of the four founders, Brian, Ewan and Gordon, are still with the business and form the current board of directors.

i4 has a mix of designers, innovators and engineers that collaborate as one team to deliver eye-catching and well-engineered products. Specific services include project management, industrial design, mechanical engineering, electronics and systems engineering, prototyping and manufacturing support.

The business has designed some well-known home and garden products for brands such as Flymo and Bosch as well as medical diagnostics and prosthetics products for world-leading vision device manufacturer Optos (part of the Nikon group) and Touch Bionics (an Össur Company).

In May this year, the company announced it had completed its transition to become an employee-owned business, with 14 members of staff becoming majority owners.  An Employee Ownership Trust (EOT) has been formed and currently holds 75% of the shares on behalf of the employees; the co-founders have an equal share of the remaining 25% but it is envisaged the EOT will eventually hold 100%.

I4 Product Design, Edinburgh Image shows directors and staff of i4 Product Design at their Edinburgh headquarters. Taken 23-05-18

Directors and staff of i4 Product Design at their Edinburgh headquarters 

We caught up with Brian Combe, i4’s managing director, to find out more about the decision to become employee-owned. Brian said:

“The main objective of establishing an employee ownership structure was to provide a stable platform for growth by allowing our employees to feel more engaged, informed and integrated into the company.

“Many exit options had been considered over the years, even employee ownership which at the time we wrongly assumed would be too complicated for us. However it soon became clear that employee ownership was an ideal fit for the aspirations of the directors, for leaving a legacy of a sustainable and profitable company.

“Since the company’s inception we have always strived to do the right thing by our employees, and so once we understood the principles of employee ownership, we knew it was the perfect vehicle for us to begin the process of engaging our team for the next chapter of our company’s development.

“We were extremely satisfied with the support we received from CDS and our legal and financial teams on implementation. Although there is a lot of hard work still to complete to make employee ownership work for us, we firmly believe that this will be good in the long-term for everyone involved. 

“All employees were kept in the loop from the start of the process. We held off-site strategy days where a wide selection of our employees attended and contributed to discussions on many points including succession and various models of ownership. Once the employee ownership model was debated in more detail and identified as the preferred option, a wholesale engagement with the employees was undertaken on a regular basis as the company stepped through the process. Keeping the lines of communication open proved to be very useful as feedback from the employees during the sessions ultimately shaped the finer details of the EOT.

“Time will tell how it might help the business but the hope is that transferring ownership to the employees is recognised as a genuine commitment and display of confidence by the co-founders in the employees being able to take the company to the next level.  We hope that the process will encourage the staff to bring new ideas, add real energy and drive to take the business forward and importantly make them feel part of something exciting and have a real sense of pride working for i4.”

EMPLOYEE OWNERSHIP IS CLEAR SUCCESSION SOLUTION FOR BALHOUSIE GLAZING

Perth-based glazing specialist Balhousie Glazing recently joined the growing number of employee-owned businesses in Scotland, with 12 staff becoming owners. Operating throughout Perth, Dundee and beyond, the company provides a wide range of services such as windows, doors and patio installation and the building of conservatories, porches and orangeries. The team’s experience spans small residential builds and renovations to major commercial projects.

We spoke with founders Malcolm Sweeney and Drew Hey, who set up Balhousie Glazing in 1993, about the decision to sell to their employees.

Employees and directors at Balhousie Glazing in Perth  Pictured Directors in centre Drew Hay (on left) with Malcolm Sweeney (on right) Taken 16-07-18

Employees and directors at Balhousie Glazing in Perth.

Malcolm said: “Drew and I had been discussing the issue of succession, and as neither of us had family members in the business, the only option we were really aware of at the time was a traditional trade sale. We would likely have been purchased by a rival company, something we didn’t want. However, one day we were reading The Courier, our local paper, and spotted an article about a nearby seminar being held by Co-operative Development Scotland the following day and decided to go along.

“It was about business succession and one of the speakers was Bob Anderson, financial director of Bentley’s Shopfitting, an employee-owned company based in Dundee. He spoke about how the EO process had worked for them and the benefits of employee ownership and we were really sold on it.

“A lot of our staff have been extremely loyal, and it was essential to us that we safeguard their jobs and ensure they could continue paying their mortgages and providing for their families. Being employee-owned would anchor the company in the local area, keeping our team’s extensive skills here too. We contacted CDS and one of its advisers paid us a visit to give us more information before we decided to proceed with the employee buyout.”

Drew added: “We had a meeting with our employees about the decision and they seemed really happy and ready to embrace their new role as employee owners. With a vested interest in the business, they will reap the benefits of strong performance, so it’s been a positive boost for morale and motivation.

“As well as retaining jobs, employee ownership will ensure the business maintains its values and ethos. Much of our work comes from word-of-mouth recommendations, and our reputation, which we have been building for 25 years, is very important to the success of the business. A trade sale to a competitor may have affected our standing in the local community or impacted the excellent customer service for which we are renowned, both of which could have a negative effect on referrals.”

EMPLOYEE OWNERSHIP IS SOLUTION TO RETAIN OWNERSHIP OF SCAN BUILDING SERVICES IN DUNDEE

Dundee-based building engineering company Scan Building Services Ltd, founded in 1980, operates in the construction industry as a specialist contractor, providing services such as heating, ventilation, air conditioning and plumbing systems.  Serving clients in the Dundee area and beyond, the company’s experience ranges from installations in domestic properties to major commercial and industrial buildings.  Scan Building Services’ clients include construction contractors, local authorities, health trusts and private companies.  It has an annual turnover of £3.9million.

In May this year, Scan Building Services announced it had completed its transition to become an employee-owned business, with 56 members of staff becoming owners.  Previous owner David Anderson has sold 100% of the shares to an Employee Ownership Trust, which is holding them on behalf of the employees. The deal was structured in order to make it affordable to the business without affecting its ability to reward the team and reinvest for the future. The plan is to also introduce an Enterprise Management Incentives (EMI) scheme for senior management.

We spoke to previous owner David Anderson and Graham Prophet, part of the senior management team, to find out more about the decision to become employee-owned.

Scan Building Services, Dundee, 11/05/2018. Scan Building Services, pictured on Dundee Law, Dundee. Directors Graham Prophet (correct, lower front centre with navy coloured jersey) and Mark McKenzie (lower front centre, black jacket, tie and white shirt) with other Scan staff. Photography for Scottish Enterprise from: Colin Hattersley Photography - www.colinhattersley.com - cphattersley@gmail.com - 07974 957 388.

Graham said: “Throughout the years we have endeavoured to provide the best possible quality of products and services to our clients and to pride ourselves in the standard of the work we provide.  To do this we employ a highly skilled workforce of dedicated and local craftsmen, many of whom trained through the company’s apprenticeship scheme.  So when we were considering our options for future ownership of the business, we wanted to ensure the jobs were retained in Dundee and the staff were rewarded for any success.  Employee ownership ticked all of those boxes and following a feasibility study last year, we knew it was the best option for us.

“A fair price was achieved for the previous owner that also ensured sufficient reserves were left in the company to provide working capital to invest for the future.

“We notified the staff early on in the process and made sure they were involved and updated as the project progressed.  All employees now have a real interest in the success of the business which will motivate them to perform and achieve.”

David Anderson added: “Rod Mathers from Henderson Loggie, a valued adviser to the business over the past two decades, suggested this very effective structure which met my objectives and allowed ownership of the company to pass to the employees, who now have a vested interest in making it the best company it can be and to benefit directly from their efforts. The team at Henderson Loggie guided us through the whole process from feasibility stage right through to completion most efficiently. I’m very proud of the way things have worked out and I wish the new owners of Scan every success for the future.”

WOOLLARD AND HENRY CELEBRATES LARGEST EVER CONTRACT AS EO SUCCESS CONTINUES

Established in 1878, Dyce-based manufacturer Woollard and Henry initially began operating in the papermaking industry. The company developed a notable portfolio of paper forming products such as dandy rolls, the cylindrical mechanism used for imprinting watermarks in paper, and was renowned in the industry for its quality, reliability and skill. However, in the early 2000s, Scotland’s once-thriving paper sector was in decline. Woollard and Henry was struggling and, unable to find a buyer, the family owners were preparing to shut it down. Employee ownership was raised as a potential solution, and with strong support from an eager workforce, an employee buyout was completed in 2002.

We caught up with managing director Fred Bowden to hear about the company’s success since.

“When the prospect of an employee buyout was first raised back in 2002, there were around 20 staff, all of whom saw a future for Woollard and Henry and the unique skills and expertise it could offer. They fully embraced the opportunity, being very supportive of the move to employee ownership and passionate about keeping the business going.

“The workforce’s newly-held stake in the business helped drive an overwhelming response to the company’s need to diversify. Taking advantage of our location in an oil and gas stronghold, it was recognised that our core skills of high-end fabrication and engineering could be transferred to the energy sector. We adapted our strategy accordingly, with the fabrication of personnel transfer vessels for the offshore energy markets in addition to its range of papermaking and watermarking equipment.

Woollard and Henry, Dyce, Aberdeen, 16/08/2012 Woollard and Henry team with managing director Fred Bowden (front) - pictured with 'Frogs' - a crane-assisted personnel transfer pod for oil and gas industry platforms. Photography for Scottish Enterprise / Cooperative Development Scotland from:  Colin Hattersley Photography - colinhattersley@btinternet.com - www.colinhattersley.com - 07974 957 388

Woollard and Henry team with managing director Fred Bowden pictured with ‘Frogs’ – a crane-assisted personnel transfer pod for oil and gas industry platforms.

“After an initial difficult few years, Woollard and Henry has continued to thrive. We involve the employees in all of the major decisions about the running of the business, and their personal investment in the company’s performance has helped develop a culture of constant innovation. We now employ 64 people and operate from five locations across the globe, going from almost zero international trade to exporting 60% of our output. We have also recently won our biggest contract to date, which will see our turnover increase to over £10million this year.”

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

EMPLOYEE-OWNED STEWARTRY CARE CELEBRATES AWARD WINS

Dalbeattie-based care at home provider Stewartry Care became an employee-owned company in 2004.  It has more than 100 staff providing care at home services across Dumfries & Galloway.  In the first year of employee ownership its turnover increased by 16% and profitability by 39%.  Since then the company has continued to flourish, with new services including a Foot Care and a Responder Service supporting over 400 individuals.

We caught up with Stewartry Care manager Debbie Cochrane to find out more about the company and its recent successes.

“We believe that employee ownership is good for everyone involved in the company.  Our employees are happy at work which is demonstrated by our staff recruitment and retention records.  The staff benefit from being able to influence the direction of the company, being informed on performance and having the opportunity to stand for election as a director or trustee of the company. Our clients also benefit from having a highly motivated team, knowing that their care team is empowered and the reassurance that the company will remain locally owned and run for the benefit of local people.

“We have a successful business model that works well for us, which is evidenced by the fact we’ve just won the Scotland’s Care at Home Provider of the Year award at the Scottish Care Awards in Glasgow.”

The awards recognise the great work undertaken by organisations and staff who work in care at home and housing support services. The company has also just been awarded Outstanding Social Enterprise at the Dumfries & Galloway Business Awards.

Stewartry Care

The Stewartry Care team at the Dumfries and Galloway Business Awards

Debbie continued: “I’m incredibly proud to manage such an amazing team; these awards recognise all their hard work.

“Our challenge is to stay at the top. We see ourselves as part of the community and we have an important role to play to support people who need our services. In addition to our recent award wins, we’ve been celebrating receiving top marks from the Care Inspectorate.  We were given a rating of six following an unannounced inspection – the highest mark possible.We were thrilled with the grading and with the feedback we get from our service users. This is a fantastic achievement by our employees and we’ll all work together to find ways to retain the ratings and improve what we do for the people of Dumfries and Galloway.”

EMPLOYEE OWNERSHIP – MAKING A SUCCESS OF SUCCESSION

We caught up with Rod Hutchison, a partner at law firm Ledingham Chalmers, to find out why he thinks employee ownership could be a great succession option.

RodHutchison

Rod Hutchison, partner at Ledingham Chalmers

Succession is an issue that many business owners choose to ignore, but it’s not one that’ll go away.

Bearing in mind planning and preparation make for a painless succession process, it is important shareholders take the time to properly explore exit routes, and there are a number of options on the table.

Many business owners avoid the topic because they can’t bear the thought of someone else owning their business.  And that’s understandable.

Entrepreneurs invest their time, their energy and their expertise into their company, so it can be difficult to think about seeing another name over their door. The trade sale can mean relocation, and for many business owners, there’s a reluctance to jeopardise the employment of a loyal workforce.

I attended a Scottish Enterprise-hosted seminar recently that presented a different kind of exit that could be the solution these business owners are looking for: the employee ownership trust (EOT).

The speaker was tax specialist Graeme Nuttall, author of the Nuttall Review of Employee Ownership, which was prepared as an independent review for the Department for Business, Innovation & Skills (BIS).

Graeme Nuttall

Graeme Nuttall, author of the Nuttall Review of Employee Ownership

Graeme is responsible for the introduction of the EOT, ushered in with the Finance Act of 2014, and set up specifically for companies where a significant shareholding is held in the interests of the employees.

The aim is to allow owners to sell the business to their employees, putting the company into the hands of those who often know it best: those inside the firm.

In this way, business continues as usual.  Relationships are maintained and jobs are protected for as long as the business continues to flourish.

What’s more, there’s mounting evidence businesses tend to outperform conventionally-structured firms on a range of different factors including productivity, profitability, customer satisfaction, innovation and employee health and happiness.EOTrust1 LinkedIn preview dimensions

For example, Matrix Evidence’s Employee Ownership Association-commissioned research said this model can improve employee satisfaction, innovation and productivity (with a tailored approach likely to be most successful).

Plus, the association’s own impact report said the growth rate of employee-owned businesses was 50% higher than the UK economy in 2012.

Tax incentive

The government introduced a tax incentive to promote the take up of EOTs.  If a business owner sells a controlling interest in their company to its employees, then that transaction is exempt from capital gains tax, subject to certain conditions being met.

The company functions like any other private business: a board of directors is still responsible for driving the success of the company, and management continues to run the organisation.

However, the shares are generally held in the EOT on behalf of the company’s employees, rather than directly by the employees themselves.

The seller can, and often does, remain involved in the company for a period to ensure a smooth transition to employee ownership.

The path to ownership

The path to employee ownership can be quite straightforward and, as these transactions don’t have the adversity you sometimes find in trade sales, they can be a smoother and often a more collaborative deal.

And, as the parties involved are internal, there is no need to open up company to external scrutiny. 

It was interesting to hear from Sarah Deas of Scottish Enterprise who described how the number of employee-owned businesses headquartered in Scotland is just about to pass the 100 mark: a threefold increase over the past three years.

And with the number of employee owned firms in the UK sitting at around 300, Scotland is certainly punching well above its weight.

Employee ownership means that companies remain local, sustaining jobs and skills, and both Scottish Enterprise and Highlands & Islands Enterprise offer financial support and signposting to business owners looking to explore this further.

EOTrust5 LinkedIn preview dimensions

As the baby boomer generation approaches retirement age, it’s easy to see why employee ownership is gaining traction as a succession solution —

  • The owner achieves the exit they want at a price they are happy with
  • The employees have a stake in ensuring the company’s future prosperity
  • It’s business as usual for customers and suppliers

And because the trust can exist for the long term, the issue of business success is resolved for the future.

Winners all round.

FOUNDERS’ VISION PUTS AUDIO-VISUAL COMPANY INTO EMPLOYEES’ HANDS

Employees of Glasgow-based Mediascape were delighted to hear that they are to become the owners of the company in a move which sees the majority of the shareholding transfer into an Employee Ownership Trust.  Angus and Shona Knight, owners of Mediascape, announced their plans at a meeting of all employees. The couple had considered a number of options and rejected several approaches to buy the company.

Mediascape designs, supplies, installs and maintains audio-visual and videoconferencing systems working with an impressive client list that includes the University of Glasgow, Strathclyde University, St. Andrews University, Historic Scotland and the National Trust for Scotland as well as many prestigious private and public sector clients. The company was set up in December 2003 and started trading in January 2004 with four members of staff. Turnover for this year is likely to be in excess of £5m, the company’s best trading year yet. There are now 24 employees.

We spoke to the team about their experience of transitioning to employee ownership.

Mediascape, Glasgow, 01/12/2017.  Mediascape staff, with Angus and Shona Knight (front). Photography from: Colin Hattersley Photography - www.colinhattersley.com - cphattersley@gmail.com - 07974 957 388.

The Mediascape team with founders Angus and Shona Knight at the front.

Shona said:  “Too often a company is sold and before long, it disappears and the jobs go.  We couldn’t do that. We have a very talented team of people at Mediascape who have shown such loyalty to Angus and I over the years.  It was time for us to recognise that loyalty.”

Angus commented: “One of the attractions of choosing this path is that there will be continuity for Mediascape customers and staff. Shona and I plan to stay on for the next few years to ensure a smooth handover and allow the management team time to get to grips with running the business.  We’re retaining a 20% stake in the business to demonstrate our commitment to the staff that we’re still part of the show.”

Lee Ferrie, one of the first employees of Mediascape and now engineering manager, added:  “Mediascape is a great company to work for. I guess we were all a bit concerned about what would happen when Angus and Shona decided it was time to move on. Now, our future is in our hands and it’s our job to continue the company’s success. It’s an exciting opportunity and we’re all up for the challenge.”

EMPLOYEES TO TAKE THE WHEEL AT JERBA CAMPERVANS

North Berwick-based Jerba Campervans specialises in converting Volkswagen Transporter vans into luxury campervans.  Founded in 2006 by husband and wife team Simon Poole and Catherine Brookes, the company carries out internal layout conversions on the iconic brand’s VW Transporter T6 model, offering six standard configurations to meet a range of different needs. Having spent long periods of time travelling in a VW camper, both as a couple and later as a family of five, Simon and Catherine use their experience to identify optimum layouts and features, working with a highly-skilled team to make their designs a reality.

In January this year, Jerba announced it had completed its transition to become an employee-owned business, with 15 members of staff becoming owners.  An Employee Ownership Trust has been formed and holds 100% of the shares on behalf of the employees.

Jerba is one of the few official Volkswagen registered vehicle body builders for the Transporter T6, demonstrating diligent compliance with a wide range of key areas. By transferring their shares to an Employee Ownership Trust, Simon and Catherine have also helped to ensure that the requirement for this specialist knowledge and skillset is anchored in the local area. 

We spoke to Simon to find out more. 

Jerba Campervans smaller

The Jerba Campervans team

“The matter of succession had originally been in the back of our minds as something we would need to properly consider in around five years’ time, however, when we started exploring employee ownership as a potential solution, we were so sold on the benefits that we decided to make the transition sooner rather than later.

“Employee ownership is an excellent business model which benefits everyone. Catherine and I can continue with our day to day roles in the business for as long as we need to, with the knowledge that the future is taken care of, while our employees are given a stake in the business and a say in how it is run. Not only do we envisage this driving job satisfaction, productivity and innovation, it ensures that the business’ unique ethos is preserved.

“We established Jerba following a decade of owning and hiring campervans all over the world and finding that the layout could be significantly improved to suit our specific needs. Our success lies in our extensive first-hand experience, insights from which have been passed on to our team. We felt that this intimate approach and the niche upon which the business was founded could be lost if Jerba was sold to another business.

“Protecting jobs was also an extremely important factor in our decision. Many employees have been with us for between five and ten years and have played a vital role in the growth and success of Jerba Campervans. Moving into employee ownership gives job certainty to everyone who works here and enables them to have proper control of their future.  The staff are very excited about the opportunities it will bring for the future growth of the business.”

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

SCOTLAND LEADING THE WAY WITH EMPLOYEE OWNERSHIP

Graeme Nuttall OBE, partner at law firm Fieldfisher and author of the influential Nuttall Review of Employee Ownership, is the UK’s leading legal expert in employee ownership. 

We spoke to Graeme to find out why Scotland is ahead of the rest of the UK in encouraging employee ownership. 

Graeme Nuttall

Selling a business to employees used to be a rare event. Now every month we hear of another company or companies becoming employee-owned.  Recently, Scotland has seen the Auchrannie Hotel in Arran, North Berwick campervan conversion specialist Jerba Campervans, audiovisual company Mediascape in Glasgow and Perth-based engineering firm Merlin ERD all become employee-owned.  But why this surge in interest amongst Scottish businesses?

I am a partner with European law firm Fieldfisher. In 2012 I took on a part-time voluntary role as the UK Government’s independent adviser on employee ownership. I produced the Nuttall Review of Employee Ownership, which articulated the benefits of employee ownership and identified what was required to deliver more employee-owned firms in the economy, ultimately paving the way for the Employee Ownership Trust (EOT). Legislation introduced in 2014 brought in tax benefits for business owners selling to an EOT and also to employees within EOT owned companies.

Since then, employee ownership in the UK has continued to grow, particularly in Scotland, where I recently met with the Scottish EO adviser community to share insights on the notable growth of the model’s popularity In Scotland.

The Nuttall Review definition is that employee ownership exists when employees are able to participate through a meaningful and significant stake in their business, and this ownership stake is underpinned by organisational structures that ensure employee engagement. A feature of many employee-owned organisations is an element of trust ownership of shares.  The EOT is designed to hold shares long term on behalf of all employees. The main benefits of trust ownership are that employees of the business know that the shares in the trust are held on a permanent basis on their behalf; and have a collective voice, through the trustee of that trust, in how the company is owned and governed.

If a business owner sells a controlling interest in the company to an EOT, the sale proceeds can be completely exempt from capital gains tax, subject to certain conditions being met.  Employees in firms with majority EOT ownership can benefit from an annual income tax free bonus up to a threshold of £3,600.

The introduction of these tax incentives was obviously a game changer.  No-one goes into employee ownership just to take advantage of tax breaks. What the EOT legislation did is recognise the benefits employee ownership brings to the economy and get these more widely known.

It is estimated there are currently at least 300 employee-owned firms in the UK and almost one third of these are Scottish based firms. These firms come from diverse sectors; professional services, health and social care, manufacturing and construction.  Employee ownership can be found in all business sectors; indeed, it is now difficult to identify sectors where there are no examples of employee-owned companies.

EBO collage

Clockwise from top left – Auchrannie, Jerba Campervans, Mediascape and Merlin ERD have recently joined Scotland’s growing number of EO businesses

But why is uptake in Scotland is significantly higher than the rest of the UK?

I believe it comes down to two factors. The Nuttall Review identified two key obstacles to the wider adoption of employee ownership: lack of awareness and lack of practical support. Co-operative Development Scotland has undertaken some sterling work with advisers, evidenced by the amount of interest shown at its January 2018 seminar. The expert help provided by Co-operative Development Scotland goes a long way to support businesses, and importantly the employees, through the process.

And will the number of employee-owned firms continue to increase at the current rate? I would go further than that. I believe we’ll see an acceleration in the growth of employee ownership.  The Scottish experience shows how this can happen.

AUCHRANNIE COMPLETES TRANSFER OF OWNERSHIP TO EMPLOYEES

LindaJohnstonLocated in Brodick on the Isle of Arran, Auchrannie is an award-winning resort comprising two 4-star hotels, thirty 5-star self-catering lodges, two leisure clubs, three individually branded restaurants, a children’s Playbarn, an ASPA spa and Arran Adventure outdoor company.  It was established by Iain and Linda Johnston in 1988, with Linda heading up the company as managing director and board chair since 2010. The resort has an annual turnover of £6.7million. 

Earlier this year Auchrannie announced it had completed its transition to become an employee-owned business, with 160 members of staff becoming owners. An Employee Ownership Trust was formed and holds 100% of the shares on behalf of the employees.  The deal was structured in order to make it affordable to the business without affecting its ability to reward the team and reinvest for the future.  It marks the first time a hotel or resort in Scotland has become employee-owned.

We spoke to Linda to hear more about the decision to become employee-owned. 

“The team were involved in the process from an early stage and were given the opportunity to input throughout.  They have very much embraced the concept of employee ownership and are extremely excited about it.  They are delighted that Auchrannie’s legacy will be protected and that they have the chance to play an active part in, and benefit from, Auchrannie’s future success.  They also realise that what each of them does will affect the future success of the business and that this is directly linked to their own success, so they have already become more engaged in making the business better and understand the power and influence each and every one of them now has on their own future.  There is no, ‘them and us’ now, we’re all in this together.

“The transition has been pretty smooth despite the fact that Auchrannie is a complex business; we have been well supported by HIE, CDS, Co-ownership Solutions and Burness Paull.  The help we received was invaluable in enabling us to put together the team who lead us through the whole process seamlessly.  Although there have been a number of hurdles to jump over, there have been no real lows.

“By transferring the shares to an Employee Ownership Trust, myself and the ex-shareholders have also protected Auchrannie’s contribution to Arran.  It is very much part of the community and provides essential wet weather facilities, other amenities and support to the island’s residents and its visitors.  The change to employee ownership means that we, along with the community of Arran, can relax knowing that it will always remain an independent, locally run organisation with community values at heart.

Auchrannie 1

“Employee ownership will give the whole Auchrannie team a stake in the continued growth of the business.  All of us will work together to build a more efficient, sustainable and profitable business.  We are all excited to continue on our journey in which we strive to lead the way in Scottish tourism and create amazing experiences for our guests and an awesome place to work for our team.”

Auchrannie’s transition to employee ownership was supported by Highlands and Islands Enterprise (HIE) and Co-operative Development Scotland (CDS), with the process managed by Co-ownership Solutions LLP and legal services by Burness Paull LLP.

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

HARVEY MAPS FINDS ROUTE TO SUCCESS

Founded 40 years ago by Robin Harvey MBE and Susan Harvey MBE to provide a professional mapmaking service for the sport of orienteering, Doune-based Harvey Maps is one of a very small number of companies in the UK to generate its own map data, becoming a market leader in maps for outdoor pursuits such as hill walking and mountain marathons.

Harvey Maps, Doune, Stirlingshire, 21/11/2017: Harvey Maps founding directors Robin and Susan Harvey.

Harvey Maps founding directors Robin and Susan Harvey.

It also recently joined the growing number of businesses in Scotland to adopt the employee ownership model, with ten staff given the opportunity to become owners. An Employee Ownership Trust has been formed and will hold 90% of the shares on behalf of the employees. Susan Harvey is the only other shareholder with 10% ownership.

We caught up with Susan to hear more about the firm’s decision to become employee-owned.  

“In due course we will want to retire. However, having formed and developed the business into a market leading company over the past 40 years, we didn’t want to sell to a competitor and see our life’s work absorbed into another company.  It was also important to us to retain the jobs in Doune.

“We wanted a succession solution which gave the company, the jobs and the brand a good chance of continued independent existence following our retirement; employee ownership ticked all of our boxes.

“The whole process has been a leap into the unknown and we could not have done it without support.  We spent quite a bit of time working with specialist advisors from Scottish Enterprise and Co-operative Development Scotland, undertaking briefings with the staff to help them understand the concept of employee ownership.

“It was an extremely busy and challenging time for the business, with the transition to employee ownership, our 40th anniversary and during the busy festive promotions season. However, the future is bright and the involvement of all employees in the ownership of the business will be a major boost going forward. I am confident that once things settle down, employee ownership will be great for the staff, the brand and the company.”

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

Harvey Maps, Doune, Stirlingshire, 21/11/2017: Harvey Maps staff, with founding directors Robin and Susan Harvey (centre), pictured outside their firm's offices (white building, left) on Doune's Main Street, Stirlingshire.

Harvey Maps staff, with founding directors Robin and Susan Harvey, centre

Merlin ERD Engineering Success with Transition to Employee Ownership

Perth-based engineering experts Merlin ERD has become the latest business to join the growing number of employee-owned firms in Scotland.

Merlin, which is celebrating its tenth anniversary in Perth, has become world leader in the design and delivery of horizontal, extended reach (ERD) and complex oil and gas wells.  The company has delivered more than 200 projects in 40 countries, all from its Perth office.

We caught up with Merlin’s founder, Iain Hutchison, to find out more about the decision to transition his business to employee ownership.

“When I first began to investigate succession options, I didn’t believe employee ownership (EO) was right for Merlin.  However, after attending a Scottish Enterprise EO session and looking at the detail, I discovered that the benefits of EO were closely aligned with our values. EO offered a succession path that increased business resilience, retained our culture and provided an ideal combination of an eventual exit for me along with advantages for our loyal staff.  I really didn’t want to see what we had built here in Scotland being moved, or worse, closed by a competitor allowing them to flourish elsewhere at the expense of our local team.  By becoming employee-owned, we’re anchoring highly- skilled jobs and a profitable high-tech business in Perth, Scotland.

Queens Award 067

Merlin ERD received its second Queen’s Award for Enterprise for International Trade in September 2016.

“Just as importantly, I want to see the business continue to grow; employee ownership has consistently proven itself to be an excellent mechanism for growth, with a more motivated and engaged workforce helping to drive innovation, ambition and turnover.

“We’ve enjoyed huge success here at Merlin ERD, expanding into overseas markets and being awarded two prestigious Queen’s Awards for Enterprise for International Trade, whilst weathering the oil and gas industry downturn.  It is my belief that our transition to employee ownership will assist in propelling the business through the next stage of growth, whilst providing exceptional opportunities for our employees who will stand to share in future profits of the business. If past performance is any guide to the future, Merlin is going to impress.”

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

MY VISIT TO MONDRAGON – AN ASPIRATION FULFILLED…

By Sarah Deas

I’ve always wanted to visit Mondragon, the world’s largest worker co-operative. So, I was delighted when the opportunity arose on my recent visit to the Basque Country.

Mondragon is the largest business group in the Basque Country. The co-operative was established in 1956 and now consists of 102 autonomous co-operatives, 140 subsidiaries around the world and 26 foundations / umbrella organisations. The group employs 73,655 workers across 268 business units.

Mondragon University, surrounded by some of the groups factories

Mondragon University, surrounded by some of the group’s factories

Whilst this sounds a large number, it represents a relatively small percentage of the 2,900 co-operatives and employee owned businesses in the Basque Country.  The significance lies in the number of industrial co-operatives within the group (68 in total) of which some are very large (employing more than 2000). Also, the breadth of the group is significant including credit, consumer, education and research & development businesses.

I met with Ander Etxeberria, director of Dissemination. To kick off our meeting he shared this video which provides an excellent introduction to the group. I won’t try and summarise its content… just recommend you watch it to learn more!

The inspiration and driving force behind Mondragon was a priest, Jose Maria Arizmendiarrieta. Recognising the economic hardships and social division that followed the world wars, he set out to change society for the better.

Mondragon

Ander Etxeberria, director of dissemination at Mondragon, with CDS Director Sarah Deas

Jose believed in the dignity of the human being, the importance of solidarity and the value of education and work. His business was founded on the principles of co-operation, participation, innovation and social responsibility, values that are as relevant today as they were in the 1950s.

He didn’t set out to become a businessman, instead recruiting others to lead the growth of the co-operative. His focus throughout his life remained on the ethos of the business and working to improve society. Reflecting on my visit, that was a key insight for me.

I wondered what Jose’s advice would be to us in Scotland as we aspire to ‘inclusive growth’ that ‘combines increased prosperity with greater equality, creates opportunities for all, and distributes the benefits of increased prosperity fairly’?

I think he’d be pointing us to reflect on our values and consider models that empower and reward a key resource (human capital) and share the dividends of enterprise more widely across society.  In fact, I was struck by the similarity in ethos to that of some owners considering succession options. Increasingly they are looking for a solution that allows them to leave a legacy… which employee ownership achieves.

If we need proof that it works… the Basque Country now has the lowest level of unemployment and inequality in Spain. Given the scale of worker ownership in the region this is a clear indication of the impact of an inclusive business model.

SHARING SCOTLAND’S EMPLOYEE OWNERSHIP STORY IN THE BASQUE COUNTRY

By Sarah Deas

Recently I was invited by the Provincial Council of Gipuzkoa to share Scotland’s success in promoting employee ownership as a succession solution with business leaders in their region. This was quite an honour given this region of the Basque Country is home to Mondragon, the world’s largest worker co-operative.

Sarah Deas Basque Country

So, why is the Basque Country interested in learning from Scotland? The answer lies in the fact that Gipuzkoa is facing similar economic issues to other developed world regions; ‘babyboom’ business owners are looking to retire – it is anticipated that a third of owners will be seeking exit solutions in the next 10-15 years.  There’s a desire to find solutions that will ensure the businesses’ continuity, maintain decision centres in the region, retain talent within organisations and motivate/reward workers.

Building upon a history of worker participation through worker co-operatives, the region is keen to promote a model that both addresses these challenges and aligns with their culture and values. Employee ownership offers that solution.

As keynote speaker at an event in San Sebastian, the capital city, I presented the economic development rationale for Scotland promoting employee ownership as a succession solution (very much mirroring that of Gipuzkoa) and shared success stories, including Aquascot and Page\Park.

The audience then heard from three local businesses that had chosen employee ownership as a succession solution; Exide (150 employee engineering business); Industrias Ormola (40 employee manufacturer of plastic, aluminium, and brass moulds for foundries); and Tarte Coop (28 employee provider of heating and air-conditioning systems).

I was struck by the similarity of each of their stories to those of Scottish businesses that have transitioned to the model. There was a strong ethos underlying each owner’s decision… a desire to see it continue in its current form, to sustain local employment and to do the best by those who had made the business a success. Also, recognition that employee ownership would drive performance and position the business well for a bright future.

A lively discussion session followed, covering many aspects of the model.  In wrapping up a question was asked as to the panel’s thoughts on the most difficult aspect of a transition. This stimulated a discussion on the difference between ownership and management. Whilst it was acknowledged that the culture in an employee-owned business will be more transparent and participative, the panel stressed the importance of clearly defining roles and responsibilities.  A valuable learning point.

The Provincial Council of Gipuzkoa has devolved tax raising powers which it uses to incentivise take-up of the employee ownership model. Whilst there are differences in approach, there was real interest to learn from the UK’s 2014 legislation that enables vendors selling a majority stake to an employee ownership trust to gain exemptions from capital gains tax and for bonuses paid out by the trust to be exempt from income tax.

Whilst the Gipuzkoa Province is seeking to actively promote the model, it already has a well-established employee ownership sector: 245* businesses employing 3,253 people (equating to 37% and 49% of employee owned companies and employees in the Basque Country respectively). So, I really did feel honoured to share Scotland’s aspiration and early success in building a strong employee ownership sector.  We have much to learn from my hosts and I look forward to continuing to share experiences.

*figures exclude co-operatives

COLLABORATIVE WORKING IS KEY TO GLOBAL RECOGNITION FOR ARGYLL AND THE ISLES TOURISM COOPERATIVE

Calum Ross - AITCOur client Argyll and the Isles Tourism Cooperative (AITC) was recently shortlisted for a major global award following the success of its highly effective “Wild about Argyll” campaign, which saw Scottish endurance cyclist Mark Beaumont embark on an ambitious 12-day journey across the region, participating in extreme sports and completing an array of challenges.

The campaign was named a finalist in the Place Brand of the Year category at the City Nation Place Awards 2017, which recognised destinations that have excelled at attracting tourism, driving economic development and engaging citizens. While Copenhagen walked away with the prize at the global conference in London, the inclusion of Argyll and the Isles on the shortlist alongside major destinations throughout the world marks a significant achievement for the consortium. We caught up with AITC chair Calum Ross (above) to learn more about the campaign and how collaborating to raise awareness has been key to driving growth of the area’s profile.

“A consortium comprising 11 organisations from across the west of Scotland, AITC was established to enhance the area’s marketing power by way of pooling resources. By highlighting the unique selling points of each individual area within the region and combining them under one umbrella brand, we had a stronger voice to promote our offering and raise awareness of the amazing experiences on offer in Argyll and the Isles. We also worked together to source external grant funding of more than £800,000 over the last 5 years, which enabled us to develop both our capacity locally and our domestic and global marketing strategy.

Wild About Argyll & Mark Beaumont Press Image CMYK

“The Wild About Argyll brand was originally conceived as a way to appeal to the adventure seeker, a much younger market on our doorstep in the Central Belt of Scotland. However with the involvement of Mark Beaumont, who captures the very soul of our region, the campaign has attracted global attention and reached an audience of millions – success which has led us to adopt Wild About Argyll as a general brand for the Argyll and the Isles region.

“Over a hundred of our local businesses supported thWildAboutArgyll Day9 NWM-23e campaign at the outset, a remarkable demonstration of the tremendous spirit of collaboration we have in Argyll. The international recognition of the campaign is not just a huge accomplishment for the area, but a real testament to the effectiveness of collaboration, which is central to the campaign’s success.

“Wild About Argyll was borne out of innovative and ambitious thinking, and delivered on a scale which would not have been possible for any of the members to implement individually. The success of the campaign is an extension of the success we have already achieved through collaborative working, which includes new trips to the area being offered by national and international tour operators we have worked with at VisitScotland’s annual EXPO events. We are now developing an exciting partnership with Glasgow Life, Scotrail and Calmac for 2018 promoting the cultural wonders of the city and the micro adventures in Argyll.

“We are thrilled to have created something that has captured the attention of so many and gained such wide-reaching recognition for our beautiful region, and we look forward to continuing to work collaboratively and innovatively to further grow the profile of Argyll and the Isles and attract more adventure seekers from home and abroad.”

WILD ABOUT ARGYLL - on glasgows doorstep

For more information about how collaboration could benefit your business, get in touch to arrange a chat with one of our expert advisors.

Pictures courtesy of Morrocco Media, Kieran J Duncan and Finalcrux Films. 

Employee Ownership Launched at STAR-Dundee

Leading aerospace engineering company STAR-Dundee is one of the latest businesses in Scotland to join the growing number of employee-owned firms in Scotland.

The company, which spun out from the University of Dundee in 2002, designs electronic components and test equipment for spacecraft, supplying it to international space agencies. We caught up with founder Professor Steve Parkes to find out more about STAR-Dundee’s growth and the decision to become employee-owned.

stuart mills

STAR-Dundee founder Steve Parkes

“Originating because several organisations wanted to use technology we were developing at the University of Dundee, STAR-Dundee has grown from an academic and a few enthusiastic research students designing and developing products in their spare time to an employer of 25 people with offices in both Dundee and Barcelona.

“Having formed STAR-Dundee and forged it over 15 years into a company with a worldwide reputation, I realised that I was not going to be around to see it through the next 15 years. It became clear that the future of the company was about the people that had helped make it a success and the culture that we had developed to support that success. Selling the company to another organisation, which would inevitably change the culture and might even move it from its Dundee base, was not a very attractive idea.

“Assisted by a succession planning project initiative by Scottish Enterprise, I reached the decision that employee ownership was the way forward for STAR-Dundee. Employee ownership retains and strengthens the culture and will ensure that the company always has a base in Dundee.

star Dundee team

The STAR-Dundee team

“The management team has been restructured to provide a firm foundation for further growth, and we’ll soon be launching a new technology, SpaceFibre, which we’ve spent the last ten years developing. Although designed primarily for spacecraft applications, it is creating interest in other areas including the robotics and medical equipment industries.

“STAR-Dundee has been a great success because of its people, and ultimately, our move to employee ownership allows these individuals to have a greater say in the running of the company and to further benefit from the success which they are instrumental in creating.”

If you would like to learn more about how employee ownership could benefit your business, please get in touch to arrange a chat with one of our expert advisers.

ACCESSING INTERNATIONAL MARKETS THROUGH COLLABORATION

ScotExport

When it comes to exporting, smaller businesses can face barriers that are less challenging for larger, established organisations. Lack of experience, legislative difficulties in other countries, and inadequate resources to manage shipping and logistics matters are just some of the challenges they come up against.

Next month, Scottish Enterprise will host ScotExport 2017, an event aimed at helping businesses build their export capabilities, featuring a packed programme of talks and workshops. Co-operative Development Scotland will be joining the Delegate Hub to talk about how collaboration can help businesses overcome some of these challenges, aiding access to international markets. Ahead of the event, to find out more about the importance of exporting and the role collaboration can play, we spoke with Karen McLeod, who manages the export advisory service at Scottish Enterprise.

Why is exporting important?
“Overseas markets have become increasingly important to the Scottish economy and in 2015 Scotland’s international exports were valued at £28.7 billion*, a 3.6% increase from 2014.

Our research shows that many overseas markets are underserved and there is demand for Scottish products and services internationally. This, paired with the fact that SE supported 2,500 businesses to export last year shows that there is opportunity and the ambition for exporting to continue to grow.”

What are the benefits?
“Trading abroad can boost your profile, credibility and bottom line.  That applies whether you’re trading with established markets such as the EU and USA, or high-growth markets like Brazil, China, India, Colombia and Vietnam.

“International markets like these offer you access to new customers, revenue and ideas. Crucially, they enable you to spread your business risk, increase the commercial lifespan of your products and services and secure economies of scale which are not always possible at home. In fact, exporting is now considered essential for Scottish businesses that want to safeguard future growth. 

“The figures are compelling, showing that those firms that choose to export become 34% more productive in their first year** while those already exporting achieve 59% faster productivity growth than non-exporters**, positively impacting on staffing and financial performance.

“Doing business overseas brings further benefits such as fostering ideas for new products and services. Once a company has ‘dipped their toe’ into a new market this in turn tends to increase confidence and ambition and provides the momentum for further growth through exporting.”

What are the barriers and how can you overcome them?
“Exporting can seem daunting to smaller businesses and the thought of going it alone can often be off putting and seen as high risk.  Collaborating with others can be a way to address those risks and make the most of the opportunities that exporting brings.”

How can collaboration help businesses access international markets?
“Businesses can collaborate using the consortium co-operative business model. This model allows businesses to come together for a shared purpose; to buy or sell in scale, market more effectively, share facilities or jointly bid for contracts. Collaborative activity can include the creation of a portfolio brand for export, consolidated shipping and joint e-commerce activity.

“A good example of businesses successfully adopting this approach is recent Collaboration Prize winner Made in Scotland: Collaborative Export Solutions, a collaboration of eleven companies involved in the luxury food and drink sector. Selling a range of products including salmon, cheese, gin and whisky, the member businesses pool together their resources and experience to extend their offering to the lucrative overseas market. Among the members is an e-commerce and logistics firm, giving valuable insight into this aspect of exporting.”

Made In Scotland Collaborative Export Solutions team members

Made In Scotland: Collaborative Export Solutions team members

 

Event information
To find out more about exporting from Scotland, join us at ScotExport 2017, taking place on 31st October at the DoubleTree by Hilton Hotel Glasgow Central. You can get more information about the programme and book your place here.

For more information about the support available to help you collaborate and access international markets please visit www.scottish-enterprise.com/collaboration.

*http://www.gov.scot/Topics/Statistics/Browse/Economy/Exports/ESSPublication
**UK Government UK Trade & Investment research publication – Bringing home the benefits: how to grow through exporting

CREATING AN ENTREPRENEURIAL AND INNOVATIVE CULTURE THROUGH EMPLOYEE OWNERSHIP

Co-operative Development Scotland (CDS) director Sarah Deas discusses the potential of employee ownership in driving an entrepreneurial and innovative culture within businesses.

FREE FIRST USE Lenny Warren / Warren Media 07860 830050  01355 229700 lenny@warrenmedia.co.uk www.warrenmedia.co.uk All images © Warren Media 2016. Free first use only for editorial in connection with the commissioning client's press-released story. All other rights are reserved. Use in any other context is expressly prohibited without prior permission.

Latest figures show that there are 86 employee owned (EO) companies operating in Scotland, with approximately 6,800 employee-owners generating a combined turnover of around £925million.

What are the reasons behind the rising popularity in an EO structure?  Aside from being a popular succession option, evidence shows it also drives an entrepreneurial and innovation orientated culture within a business.

Bright Ascension, experts in space technology, recently became employee owned in order to help meet plans for growth and to continue developing and creating innovative products. The Dundee and Edinburgh based business specialises in software products and services for satellites.

In order to build a world class business the directors recognised that they needed to attract, retain, motivate and harness the best talent in the field.  Their main priorities were to scale up the business by attracting investment and then fully engage employees to drive performance within the business.  These goals have been achieved through employee ownership.

Bright Ascension company, Edinburgh, 14/03/2017: Bright Ascension founder director Peter Mendham (correct, bottom), with technical director / software engineer Mark McCram and a satellite launch control board. Photography for Cooperative Development Scotland / Scottish Enterprise from:  Colin Hattersley Photography - colinhattersley@btinternet.com - www.colinhattersley.com - 07974 957 388

Bright Ascension founder director Peter Mendham and technical director / software engineer Mark McCram.

Similarly 4C Design, Hunter Adams and Accord Energy Solutions have all chosen the model to drive an entrepreneurial and innovation orientated culture. By having a stake in the business, employees have a vested interest in increasing productivity and driving innovation.  This sense of ownership leads to employees being more willing to contribute ideas, from developing new products to identifying new markets.

Statistics consistently demonstrate that employee-owned businesses outperform their non EO counterparts in terms of higher levels of profitability, improved business resilience during times of recession, increased productivity, enhanced employee wellbeing and greater desire to innovate. Recognising the benefits of the model, the Government recently introduced tax incentives to increase its adoption.

I’m anticipating that in the years ahead employee ownership will increasingly be adopted as a way to recruit, retain and reward employees, enabling business growth and higher levels of performance.

Through Co-operative Development Scotland we provide free support to businesses considering employee ownership, offering specialist advice and support to help them adopt the model.

For more information on the services provided by CDS, click here.

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