Page 18

THE OWNERSHIP DIVIDEND

WHAT DID THE INQUIRY DISCOVER? EO BENEFITS THAT EMERGED FROM THE INQUIRY

The positive impacts of EO are many and various, and the advantages of the model stretch to individuals, businesses, regions and the wider UK economy. However, EO is no holy grail – the model is not appropriate for every business, and some of its manifold benefits are found separately in other models. EO also does not insulate a business from challenging market conditions, or avoid the need to innovate and stay competitive. Yet the more than 100 case studies fielded by the Inquiry reveal profound qualitative evidence strongly supporting the case for greater uptake of EO in the UK. It found that EO triggered

fundamental enhancements to companies’ productivity, resilience and decision-making. But the advantages reach well beyond the confines of the businesses themselves, creating a virtuous circle for local, regional and national economies as more firms adopt the model. At the outset, it was vital for the Inquiry to settle upon a definition of EO that would guide its work. As such, it looked to the 2012 Nuttall Review, which states that, for EO to be meaningful, “the employees’ stake must underpin organisational structures that promote employee engagement in the company”. Those structures take three main forms:

DIRECT EO Staff become shareholders, each holding a set number of shares and using one or more tax-advantaged share plans. Inquiry participants using this model: 8%

INDIRECT EO Shares are held collectively on workers’ behalf via an employee trust. Participants using this model: 28%

HYBRID MODEL Combination of direct and indirect share ownership. Participants using this model: 64%

18

The Ownership Dividend  

The Ownership Dividend The report of the The Ownership Effect Inquiry. Copyright 2018 Employee Ownership Association and LID Publishing.

The Ownership Dividend  

The Ownership Dividend The report of the The Ownership Effect Inquiry. Copyright 2018 Employee Ownership Association and LID Publishing.