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1
Informing and consulting in an employee owned firm – our experience
Lesley Doran – WTB Group HR Director
• Established in 1929 - W.T. Burden Limited is a private company, co-owned between a charitable foundation, employees and the founding families
• 1961 – Shares transferred to directors
• 1974 – Charitable Foundation established with gift of circa 40% of company shares
• 1987- First all employee Share Scheme introduced
• 2008 Scheme of arrangement – next generation of shareholders
• WTB share structure ensures that all our people have the opportunity to share in the growth they create through the value of their shares - recognises and supports both long term commitment and innovation
History
2
WT Burden Shareholders
• Three main groups of shareholders
Ownership Structure – 2nd generation (Scheme of arrangement 2008
WT Burden
Ltd
Employees
14% voting
40% growth
Burdens Charitable Foundation 46% voting
32% growth Founding Families
(40% voting
28% growth)
3
Values
• Long term sustainable growth
• Employee share ownership
• Independence and innovation
• Respect and responsibility
• An environment that offers everyone the opportunity
to achieve their full potential
Structure
WT Burden Ltd
(Shareholders)
Burdens Ltd
(UK Trading)
International Trading
(Ireland, UAE, Oz, US)
Investments
(Strategic)
WTB Group Ltd
(Services and Brands)
4
GrowthDriven by ownership model
How we communicate
• Vision Magazine
• Meetings
• MAC
• Bi-Annual Road Shows
• Employee Surveys
• Information & Consultation Forum (ICF)
5
Our Experience
• Information and Consultation Forum – Formed 2007
• How our ICF is structured?
• What were our initial challenges?
• A sample agenda
• Where we are now & what are the benefits today?
• Moving forward?
Why?
• Challenge our own structure
• Open up direct dialogue with employees on matters
that affect them
• Listen to our employees views from all parts of the
business - consult
• Drive employee / shareholder concept
• Providing a mechanism where the needs of the
organisation was communicated in a meaningful and
relevant way
• Listen and respond to the needs and concerns of our
people
6
Our Structure
• 1,126 employees in over 50 locations
• Formal constitution – outlining the objectives, scope,
membership and functioning of the committee
• 20 Employee Representatives
• Board represented by – CEO & HR Director
• Representatives sit for a term of two years although
may be voted in for a further term
Initial Challenges
• Cultural
• Management buy-in!
• Lack of confidence from Representatives
• Trust
• Apathy
• The recession
7
Sample Agenda - October Meeting
• A quick look back on last year - JPB
• Burdens financial overview year to date - JPB
• Recent communication to shareholders - JPB
• Business Update - JPB
• A time for change - JPB/PS
• Marketing & Communication - CB
• IMS External Audit Report – results - LD
• Staff Survey - LD
• Flex - LD
• Employee Charitable website - LD
• Representatives questions and feedback
Benefits to date
• Improved understanding of organisational priorities
and challenges
• Building a positive climate of employment relations
and trust
• Effective change management
• Increase in activity in relation to benefits etc.
• Strong forum to explain on-going investment activity
8
Moving forward
• Formalise representatives time allocation
• Commence consultation for an Employee
Representation on EBT
• Identify gaps / greater integration
In Summary
• Employee representatives:
– must be willing
– must reflect workforce composition
• The Organisation:
– must be committed to genuine information-sharing
and consultation
– must be consistent
– must be patient
– must be prepared to act and change!
9
Castlefield
John Eckersley – Director
(A challenge on a slightly different scale!)
• Established in 2002 – Castlefield Investment Partners LLP (3 colleagues + 1 external investor –Burdens Charitable Foundation)
• August 2009 – Group holding company structure created, now for two trading businesses (an investment manager plus a financial adviser)
• The culmination of a decision to build a sustainable business, providing the means to gift shares to clients
• EBT created and gifted with cash to buy shares in the new holding company. WTB’s EBT also became a key shareholder, alongside BCF
• Today – £1.5m turnover / 20 colleagues
History
10
Ownership Structure
Ords 47.4% 16.9% 29.4% 6.3%
100% 100% 100%
Management & Employees BurdensCharitableFoundation
EmployeeBenefit Trusts
DiscretionaryClients of Castlefield
Castlefield Capital Limited
Castlefield Investment Partners LLP
(Authorised & regulated by the FSA)
Castlefield Wealth Management Limited
(An Appointed Representative of CIP LLP)The GAEIA Partnership Limited
(Authorised & regulated by FSA)
Values (look familiar?)
• Long term sustainable growth
• Employee share ownership
• Independence and innovation
• Respect and responsibility
• An environment that offers everyone the opportunity
to achieve their full potential
(We are an investee business of BCF)
11
How we communicate
• We talk to each other (!)
• We try and communicate reasons for big changes
(e.g. re-branding) in small groups, face-to-face
• We try to provide depth and breath of information to
all colleagues, to explain the reasons for business
decisions – initially in writing
• “The little book of Castlefield” – both client-facing and
colleague-facing versions
• We keep close to WTB and their latest thoughts on
best practice
Our Experience
• Possibly a little too early to tell how much colleagues
appreciate our unusual ownership structure
• Once all direct shareholders, feedback to be
encouraged
• Positive reaction from existing/potential clients and
individuals wanting to join a firm that is ‘different’
• Sustainability key in our sector, where takeovers and
redundancy are normal
• No lay-offs or salary cuts below senior management
• Trying to build trust and confidence across the group
• Recent acquisition (partly in shares) encouraging
12
Moving forward
• Offer all colleagues the chance to take shares in lieu
of cash bonuses (at enhanced rate)
• Speak to everyone about their perceptions
• Is everyone ‘on message’?
• Could need some external help
• Keep explaining what we’re about to anyone and
everyone who’ll listen!
• Enhance the role of our EBT, so it becomes a focus
for representation and a natural buyer of shares
• Promote employee ownership via association with
Capital for Colleagues
In Summary
• We’ve been around almost a decade but are
probably only now getting to the right structure
• (Think about it more at the outset)
• The biggest challenges lie ahead as we grow
• We need to define clearly the culture and freeze it, to
ensure further growth doesn’t dilute it
• We’ve been fortunate to have WTB EBT as an
investor – to give time and services for free
• Further help from WTB perhaps, by way of ‘full
emersion’ course for new colleagues?
• Target a greater formal role for the EBT