K&H became members of the Employee Ownership Association (EOA) last year, having launched our company-wide share ownership scheme the previous year – everyone at K&H is now a shareholder in the company. (See my previous blog posts on this here and here.)
The EOA is an organisation that exists to promote co-ownership of companies by their employees. Members include the John Lewis Partnership, Arup, Unipart, etc.
Last Thursday I attended the annual dinner at the House of Commons. Visiting there was a great experience in itself (despite queuing for over half an hour to get through the airport-style security). The main highlight was listening to a speech by Will Hutton, economics writer and former Observer editor and now David Cameron’s appointed Chair of the Commission on Ownership.
I have read his articles for years and always been impressed with his insights into economics. Needless to say, he had many thoughts on recent events in the global economy.
His main theme was that unfettered capitalism – the pursuit of maximising shareholder value as an overriding aim – in itself was no longer a viable model for our free-market economy. Also, given that communist models have long been discredited as a viable alternative, we need to look to new ways of running businesses to avoid the need for excessive regulation.
The solution that Will espoused involves more varied ownership models including employees, with a much more engaged and committed work force.
He also put forward his own definition of ‘fairness’ to serve as a guide to the distribution of income within these organisations: ‘Discretionary effort with proportionate reward’, as opposed to the extremes of ‘reap what we sow’ and ‘from each according to his ability, to each according to his need’.
Following Will, Norman Lamb, Lib Dem MP and Chief advisor to Nick Clegg, spoke about his ambition to promote employee ownership models in the public sector – including the Royal Mail and NHS, as the only possible way to shake those huge organisations out of their endemic inefficiencies.
Would you be willing to give shares to your employees? Please let me know your views.