Informing and consulting in an employee owned firm … 5 - Lesley Doran a… · Informing and consulting in an employee owned firm – our experience Lesley Doran ... John Eckersley

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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

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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)

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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)

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GrowthDriven by ownership model

How we communicate

• Vision Magazine

• Meetings

• MAC

• Bi-Annual Road Shows

• Employee Surveys

• Information & Consultation Forum (ICF)

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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

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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

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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

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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!

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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

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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)

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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

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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