Changing how we organize ownership in companies requires more than just a good idea. It demands persistence, creativity, persuasive storytelling, and—perhaps most importantly—a community of like-minded partners working together to build momentum. Over 120 participants gathered from 15 countries—representing business, government, and civil society—met to discuss how employee ownership can become a sustainable and profitable way of doing business.

What Is Employee Ownership?

Employee ownership means that employees hold a significant financial stake in their company and, in some cases, participate in important decisions within the enterprise. This model goes beyond traditional ownership structures, where profits are typically distributed as dividends to external shareholders. In an employee ownership structure, employees share in profits, which they can use for personal goals like tuition or a home down payment.

Employee ownership can take various forms, such as stock plans (ESOPs in the U.S.) or worker cooperatives, which have existed in some countries for decades. A well-known example is the Mondragon Corporation, a network of 95 autonomous cooperatives in Spain’s Basque region. The Mondragon model often serves as inspiration for companies worldwide.

Why Now?

Employee ownership has gained more attention in recent years, due to several factors:

• Economic Inequality: The gap between rich and poor is widening. Employee ownership provides a way to combat this inequality by allowing employees to build wealth. If just 10% of all companies in the U.S. were employee-owned, the wealth share of the poorest 50% would more than double. Median wealth for Black households would also double.
• Demographic Shifts: In many Western countries, a large number of businesses will soon face succession issues as baby boomers retire. Converting these companies to employee ownership models can help address this succession crisis.
• Successful Examples: In the UK, the number of employee-owned businesses has increased sevenfold since 2017. One reason for this success is the UK tax law, which offers a full exemption from capital gains tax for owners who sell their business to an Employee Ownership Trust (EOT). This measure encourages business transfers to employees and preserves the ownership structure.

The Global Status of Employee Ownership

Although employee ownership is advancing faster in some countries than others, interest is growing worldwide. In 2024, Canada passed its first national legislation promoting employee ownership. This law provides a tax exemption on the first 10 million dollars of capital gains for sales to an Employee Ownership Trust. However, the law expires in 2026, creating urgency to make this temporary program permanent.

In the U.S., the number of Employee Stock Ownership Plans (ESOPs) remains stagnant at around 6,500 companies, partly due to less favorable tax benefits and more complex regulations. ESOPs are also subject to oversight by the Department of Labor, adding uncertainty to the transition process.

Despite these challenges, interest continues to grow in the U.S. and beyond. Newly established organizations, such as Ownership Capital Lab and Common Trust, are working on new models to promote employee ownership.

Challenges and Solutions

At the Oxford symposium, the question was posed: How can we move employee ownership from the margins to the mainstream in more countries? Three major challenges emerged:

1. Financing Transitions: If employees want to buy their company, they must be able to do so without taking on excessive debt. Seller financing, where the seller arranges a multi-year payment plan with employees, is one option. However, not all sellers can wait a decade for full payment. A solution is the creation of employee-led buyout funds, like Apis & Heritage Capital Partners in the U.S.
2. Complexity of Transitions: Selling a company to employees involves not only financial matters but also governance and decision-making post-sale. Organizations such as Project Equity in the U.S. provide support for new employee-owners before, during, and after the transition, but more support is needed.
3. Public Awareness: Most owners do not consider selling to employees simply because they are unaware of the possibilities. This calls for targeted awareness campaigns among both entrepreneurs and their advisors.

Creating a Culture of Ownership

The Oxford gathering focused not only on policy but also on stories. One story was that of Dan Kenary, founder of Harpoon Brewery in Massachusetts. He recalled the day he announced to all his employees that they would become the new owners of the company. Although the transition to employee ownership in 2014 coincided with a surge of new craft breweries competing for market share, this was a defining moment for Kenary's employees, greatly strengthening their sense of engagement and ownership.

How Can We Make Employee Ownership the Norm?

We stand at a crucial point. Globally, the possibilities for employee ownership are being explored more actively, but making it the norm requires a joint effort. There are successful models and strong evidence of the benefits of employee ownership, but more is needed. It calls for a combination of policy, financing mechanisms, and—above all—a robust network of advocates willing to share their knowledge.

As a business owner, do you want to know how to realize employee ownership? At Share Council, we help companies share ownership with their employees and guide you through the process. Contact us to discover how we can help make employee ownership not only possible but also successful for your business. Together, we can set a new standard and build a future where employees thrive as owners of their company.