The Road to Succession – what you and your EO business need to know
How organised are you when it comes to succession planning? If you’re a founder/owner who has chosen to transition your business to EO or an MD picking up the reins, a new report by the Employee Ownership Association is an essential read for you.
‘The Road to Succession: Exploring Leadership Succession in EO businesses’ spotlights what works – and what doesn’t. It also reveals the common steps that lead businesses to a successful transition to employee ownership.
Understanding the journey
JGA was delighted to collaborate with Telos Partners to support ‘The Road to Succession’ by carrying out the separate interviews with founders and successors on which the report is based.
In all, our team and Telos spoke confidentially and in depth with founders and leaders from 25 employee-owned businesses (all EOA members) on behalf of the EOA.
Our focus was clear: to discover the common themes that apply to a successful transition of leadership, when the ownership of the business is in transition too.
How is this different in an EO business? What does it look/feel like through the founder’s and successor’s eyes? All vitally important to understand when so much is at stake for all involved – from the founder/owner and leaders to the wider business, customers and employees.
Learning from experienced hands
So what’s in the report? In short, practical insight and guidance for those planning, or undergoing, leadership succession in their own EO business.
This includes top tips from founders and MDs with lived experience of the journey, ranging from getting started early and setting a realistic timeline to not being ‘afraid’ to ask for support.
‘The journey of leadership succession in an EO business is filled with unique advantages, opportunities and challenges,’ says the EOA’s James de le Vigne. ‘Whether you are a founder, successor, employee owner, customer or supplier to an EO business, this report will help you address the questions and uncertainties that [can] arise.’
Equipping your successors to succeed
Our MD Jeremy Gadd agrees. ‘This has been an interesting project for the JGA team to be involved in, and we’ve enjoyed helping to pull the report together with the team at Telos Partners.’ he says.
‘Having supported many businesses to navigate the challenges of EO, it was a privilege to take time out, sit down and listen to their stories… I thank [all those who took part] for the honesty they brought to each of the conversations we had’
Jeremy Gadd, JGA’s founder and MD
‘Having supported many businesses to navigate the challenges of EO, it was a privilege to take time out, sit down and listen to their stories of success and shortfall. I thank all the founders and successors who took part for the honesty they brought to each of the conversations we had.’
And what about the result of all those conversations? Jeremy is impressed, describing the output of the ‘Road to Succession’ project as ‘invaluable’.
‘It highlights routes to success, mapping out potential sources of support to help others achieve positive outcomes,’ he explains. ‘I’d recommend this report to any founder or MD who’s leading an employee-owned business today.’
Want to know more?
One of the themes to emerge from ‘The Road to Succession’ is that a successful succession comes at the end of a long road.
However, learning from those who have done it is one way to give your leadership successors the best possible start on the journey – and equip them to navigate the challenges that will arise. To find out more and get your copy, follow the links below.
Download the EOA’s ‘Road to Succession’ report here.
To find out how JGA can support your EO business’s succession planning with our transition, people and governance services, get in touch.
How to strengthen your Trust Board in challenging times
Are you an Independent Trustee or in a business with one, or more, on your board? If so, you’ll understand the difference the right Independent Trustee can make, thanks to the critical support and independent oversight they bring.
At JGA, we appreciate Independent Trustees too – not least because three of our team have first-hand experience of the role.
Our MD Jeremy Gadd, Associate Philippa Meaden and Operations Manager Lisa Fryer all hold this position on a range of EOT Trust Boards. Lisa is particularly excited (as are we!) because she has just taken on her first Independent Trustee role – at EO manufacturing company Pym & Wildsmith.
Supporting the next step on your EO journey
Through JGA, Lisa was already supporting Pym & Wildsmith to navigate their transition from family-owned business to employee ownership, but has handed over that work now she is Chair of Trustees.
‘It feels quite a privilege to be appointed as an Independent Trustee and I am excited to be joining the team as they really get to grips with embedding their employee ownership across the business,’ she confirms.
‘I can’t wait to get stuck in and make an impact in this new role.’
‘I’ve seen the journey the whole team has been on to get to this point, both physically and emotionally, so I’m hopeful I can bring this understanding to a different role and support them on the next step in their employee ownership story.’
Lisa Fryer – Pym & Wildsmith’s new Independent Trustee
Ensuring your governance is strong
But every EO company is different, so how do you find the best Independent Trustee for your business? Someone who can listen and contribute usefully to your board’s (often complex) conversations, asking the crucial questions that keep your governance strong?
At JGA, we can help.
We have a track record of working with clients not just to find the highest-calibre Independent Trustees but also to strengthen their Trust Board effectiveness in the longer term. Here’s what we do.
1. Finding the right Independent Trustee for your business
A good Independent Trustee brings independence of thought, a fresh pair of eyes and the ability to ask the simple questions that invite people to think in a different way.
We source high-calibre Independent Trustees for forward-thinking EO organisations – in partnership with leading executive search business Russam.
Read about our Independent Trustee Resourcing service (including how to register if you’re looking for your next Independent Trustee opportunity) here.
2. Enhancing the effectiveness of your Trust Board
A strong EO Trust Board adds even more value in tough times, with its oversight of risk and role as a conscience for the executive board providing a positive support for effective decision-making.
We enable businesses to build Trust Boards that actively make a difference – adding assurance that your governance is strong. It’s good practice to check in regularly and revitalise your governance if needed, whatever stage of being EO you’re at.
Read about our Trust Board effectiveness support here.
‘A good independent Trustee brings independence of thought, a fresh pair of eyes and the ability to ask the simple questions that invite people to think in a different way. We source high-calibre [people] for forward-thinking EO organisations…’
J Gadd Associates
3. Supporting your Employee Trustees to develop and grow
Not every EOT has Employee Trustees, but those who do know the value this hugely responsible (often misunderstood) role can add.
Trustee Connect is JGA’s friendly and insightful open forum for Employee Trustees who want to network, share best practice and grow. It’s confidential and free to all our current/former clients, with quarterly online meetings run by our Associate Kathie Robb.
Read about Trustee Connect and how you/your Employee Trustees can join it here.
Kathie Robb runs JGA’s open forum for Employee Trustees – Trustee Connect
Want to know how JGA can enable you to strengthen your Trust Board and business? Follow these links or get in touch.
Meet Adrian – our board development and resourcing pro
‘There’s no typical EO business, no typical EOT, no typical EO culture and that makes my work with JGA very interesting’. So says our Associate Adrian Wheale, whose specialist focus doesn’t ‘just’ cover executive selection but spans ongoing board development too.
And he loves it. Why? Because whether it’s corporate governance, executive resourcing or the need to strengthen board effectiveness, ‘it’s always about the people’, Adrian says.
‘It’s the opportunity I have to add value that matters. The fellowship of my colleagues, the engagement of our clients, the real people / real time nature of the work we do – at JGA, these are all the things I most enjoy.’
Developing an effective executive team
Good news then that demand for the specialist board support Adrian provides through JGA is growing, and his diary for the months ahead is already filling up.
Adrian (far right) with other members of our team
This is being driven (in part) by the economic climate, which is stress-testing many businesses, overstretching leadership experience and affecting some companies’ ability to raise funds. It’s tough out there right now.
Yet that makes Adrian’s extensive commercial, governance and board-level (Chairman, MD and NED) experience particularly relevant, and is fulfilling work for someone who thrives on variety.
‘Being the catalyst that crystallises boards to become better boards, and stepping up people to that board, is different every time because of the personalities and pressures involved,’ he explains.
Striking a balance between the executive and trust board
‘The better the Trust Board the better the EO model and getting the balance right between the Executive and Trust Board is a ‘real time’ challenge… It’s not an easy gig and if you’ve never been on a company board you may not have the skills or experience required’
Adrian Wheale, JGA’s board development expert
‘In an EO business, I’m interested in the dynamic between the different stakeholders: the company vendors, the executive team and the Trustees. Often, the executive team is an important stakeholder, yet it may not be recognised as such or it could be struggling now that the founder/owner is letting go.’
He is quick to point out that the Trust Board is also very influential. ‘It’s a cliché’ but it’s true: the better the Trust Board the better the EO model,’ he confirms, ‘and getting the balance right between the Executive and Trust Board is a ‘real time’ challenge.
‘There has to be a tension because one board is running the business on behalf of everybody and the other is ensuring it’s run on behalf of the trust beneficiaries. It’s not an easy gig and if you’ve never been on a company board you may not have the skills or experience required.’
Working with a diverse EO sector
Adrian’s background isn’t in EO, but since becoming an Associate with JGA he’s quickly gained a ‘good handle’ on the complexities involved. He’s also been ‘pleasantly surprised and stimulated’ by the variety he’s found.
Adrian catching up with JGA colleague Lisa Fryer
As he explains: ‘I knew I would be working with a diverse range of clients, motivated into EO for a range of reasons, but the variety is far wider than I imagined. We’re talking about ‘50 shades of grey’ in people here.
‘There’s no typical EO business, no typical EOT, no typical EO culture – and becoming EO is a complex move.
‘I enjoy the creative element of putting context to what each business does – how long it’s been EO, the state of play on the executive board, whether the Trust Board has already been put together and, if so, to what degree.
‘I then focus on where the need to change is most immediate. If there’s a gap, it may need an executive recruitment to fill it or ongoing individual mentoring or board development to upskill.’
JGA – the ‘people people’ in EO
In smaller organisations, the transition for the founder/owner to EO is often ‘mirrored by a second journey’, he adds, as the company moves from being product-driven to market-led.
This means that ‘future casting’ (predicting things that will have a significant impact on your business) is happening simultaneously to the transaction, presenting another challenge for the incumbent, or nascent, board.
‘All this activity requires a huge amount of mental agility from both the founder/owner and the leaders taking over,’ says Adrian. ‘This is where JGA’s flexible no-one-size-fits-all approach allows me to first understand each client’s ‘palette of issues’ and then chose the right colours to paint in the gaps.
‘I see JGA as the ‘people people’ in EO and that is reflected in our bespoke approach.’
Maintaining his focus and enjoying life!
It sounds like fulfilling work which could also (at times) feel demanding, so what keeps Adrian focused through his working day?
1. The ability to work from home and the freedom this brings regarding my family and my business.
2. The most annoying dog on the planet who crashes into many of my digital meetings! He’s a wire-haired dachshund and is a small dog with a BIG character.
3. The variety of clients I deal with, through both JGA and my own business.
4. Having had years of leading someone else’s business, then leading my own, I like that JGA isn’t my business: it’s Jeremy’s and it’s in good hands. I’m happy now to be a NED and consultant: I advise, solve problems and can multi-task.
5. Living where I do in a great urban village, with everything I need close by: a library, pub, a Waitrose and the connectivity that became so important during Covid. Even better, I can walk to the downs…
Find out more about how we can support you and your board through our transition, people and governance services – get in touch
Letting go as a leader when selling your business to an EOT
What’s your succession plan for your business? The challenging start to 2023 has brought this issue into sharper focus for many founders/owners, hastening their desire to leave completely or step aside from the top while remaining on board.
It can be an exciting time, especially if your exit strategy includes transitioning your business into employee ownership. But like any significant change it can also have a profound impact on you individually as a leader as you prepare to ‘let go’.
At JGA, we’ve listened to more than 150 founders/owners: that’s why we understand that, when it comes to selling your company to an EOT, no leader can truly know how they’ll feel until the transition is done. So how can you prepare yourself as well as your company for the shift to EO?
Securing your legacy as a founder / owner
Founders/owners generally choose employee ownership for a mix of reasons. Commercially, selling to an EOT can be the most tax-efficient option when succession planning – yet legacy and loyalty also often play a part.
Legacy, because the founder/owner wants to secure their company’s long-term sustainability and values. Loyalty, because they don’t want to ‘sell out’ their team or worry that a trade sale will see good people lose their jobs and those skills disappear frm their community forever.
The lack of a natural ‘heir’ in a family business can also influence the decision. Or selling to an EOT can be the logical next step in becoming a values-led company.
Preparing yourself for a different future
Whatever the reasons, it’s a step into the unknown that creates an impact. And like marriage, divorce or moving, this can take time to show.
At JGA, we’ve seen first-hand that how founders/owners prepare themselves psychologically to stay or go will significantly affect the success of the initial EO transaction.
For leaders, mindset matters as much as the legal and financial process. Each client has their own ‘story’ and we’ve yet to meet a founder/owner without a passion for the company they’ve built.
‘Whatever the reasons, [selling your business to an EOT] is a step into the unknown that creates an impact. And like marriage, divorce or moving, this can take time to show. At JGA, we’ve seen first-hand that how founders/owners prepare themselves psychologically to stay or go will significantly affect the success of the initial EO transaction. Mindset matters as much as the legal and financial process’
Shaping your new identity and purpose
So what’s the greatest challenge for leaders planning an EO transition? Being a founder/owner isn’t just a title: it’s an identity. Adjusting to that loss and finding who they now are and a new purpose can be a shock, but it’s also an opportunity for personal growth.
That’s why we enjoy supporting founders/owners to prepare themselves and their leaders through our insightful Coaching through Change and Change Workshops – adapting our approach and tools to engage different learning styles.
Securing knowledgeable support from a specialist adviser who understands EO can be the difference between a successful transition for you and your company and one that takes much longer to bear fruit.
Getting leaders and business ready for change
Our record of working with founders/owners at all stages means we know how to navigate them successfully through an EO transition – and support their EO company to thrive in the years ahead.
Clients describe us as ‘thoughtful’ and ‘easy to talk to’. We enable them to manage their exit and continue to engage meaningfully with their company in future – if that’s what they want.
At JGA, we’re also currently on our own path to employee ownership, bringing an even deeper understanding of its impact to our founder and MD Jeremy Gadd. Jeremy has long had an interest in this aspect of EO transition and even wrote his Henley Business School MSc dissertation on it in 2018!
No surprise then that he is honest about what he expects to be his biggest challenge: allowing those around him to pick up the reins and take us forward, while trusting himself to ‘let go’…
A version of this was first published as a guest blog on the website of one of our trusted partners, Postlethwaite Solicitors.
Want to know how we can support you and your business through our transition, people and governance services? Get in touch with us now.
Taking tough decisions as an EO business – practical steps
The UK might have narrowly avoided a recession so far, but that doesn’t change the pressure many companies continue to face. These are tough times, and tough times bring tough decisions – particularly when restructuring, redundancies and cuts to hours are involved.
Elon Musk’s approach understandably made global headlines (for all the wrong reasons) when he took over at Twitter last year.
In fact, the CIPD put the billionaire on the cover of its People Management magazine as an example of ‘how not to make people redundant’ and went on to explain the legal, commercial and personal considerations a good employer should instead apply, in its informative article within.
So if you’re the leader of an EO business taking tough decisions in the current climate, what should your priorities be? What is best practice?
Here, our Associates Lisa Fryer and Kathie Robb share their insight and five practical steps to support leaders to take tough decisions when they are EO.
Do your research – then clarify options
You have a tough decision to make. Start by investigating your options, clearly setting out each one’s pros and cons.
‘This will help when it comes to seeking the support – or even agreement – from stakeholders,’ says Kathie. ‘Remember that in an EO business you may need your Trust Board’s approval if redundancies or significant changes to your structure are being considered.’
Next, do your research and check current best practice with trusted sources, including the CIPD and your legal advisors or accountants. They will help you navigate the statutory requirements and meet minimum expectations.
You should be mindful of your business’s values, ethos and wider reputation too.
As Lisa (who is also JGA’s Operations Manager) explains: ‘There’s nothing wrong with working to minimum statutory requirements, but if your customer base values trust and respect highly, you should take this into account.
‘Younger customers and the power of social media mean that a poorly-considered action can have a significant impact on your reputation (as seen at Twitter) – risking your business’s sustainability in the longer term.’
Keep your employee-owners informed and engaged
One of EO’s benefits is that the best solutions can come from within.
In companies with a genuinely effective EO culture, the employees will already understand your business’s challenges and direction of travel.
‘While it might be scary to explain that tough decisions must be taken, if your employees are already informed and engaged it’s likely these won’t be a huge surprise,’ Kathie points out.
‘Values-led businesses tend to work with transparency and appreciate honesty, so bear this in mind.’
Avoid taking hasty action under pressure
So what mistakes might leaders make when taking decisions in today’s climate – and how can they avoid them? Lisa identifies the top two as taking ‘hasty action’ as a result of feeling pressurised because of rapidly evolving situations – and not seeking expert advice.
‘There’s a risk of just doing what might have been done before, even though legislation, attitudes and expectations might have changed,’ she says.
Another pitfall can be the informal leaking of concerns and challenges, causing unnecessary unrest, speculation and distress.
If your network is raising concerns, Lisa recommends working with ‘general observations rather than specifics’. Save those details for trusted specialist advisors instead.
Seek expert advice on best practice HR if you need it
Having the right HR policies in place (ideally from the start) will also support leaders when they face tough choices.
‘Investing time in an HR policy for restructuring and redundancy might not be your priority when all is well, but it will give your business a solid basis if needed later,’ Kathie explains. ‘Flexible working, career breaks and contractual flexibility as an employer might also afford a more open discussion / conversation when the tough times hit.’
Don’t forget to ensure any HR policy is updated to keep it legally compliant. You should also take account of changes in attitude and expectations, especially around restructuring and redundancy. Seeking expert external advice can be particularly useful here.
‘Any Trust Board worth its salt will be asking the operational leadership to identify the current top challenges facing the business and, more importantly, what plans are in place to mitigate their impact as early as possible’
Kathie Robb, JGA Associate
Draw on the insight and value of your Trust Board
As you’d expect, sound governance comes into its own when tough decisions need to be made.
In an EO business, the Trust Board can add real value, with its oversight of the business risk register and role as a conscience for the Operational Board providing a positive support for effective decision-making.
‘Taking a more measured approach and looking through the longer strategic lens, the Trust Board can ask difficult questions during the good times and increase scrutiny and challenge as situations change,’ Kathie reveals.
‘Any Trust Board worth its salt will be asking the operational leadership to identify the current top challenges facing the business and, more importantly, what plans are in place to mitigate their impact as early as possible.’
‘Smoothing the curve of change and helping to minimise any shocks – this is where sound governance can pay real dividends,’ Lisa adds.
Support your leaders to deliver change well
Of course, tough decisions don’t only affect those on the receiving end of difficult news. Leaders are people too so a good EO business should be providing them with the right professional (and personal) support to deliver change well.
‘It’s easy to assume that senior leaders will be capable and ready to communicate and support the delivery of tough decisions,’ says Lisa, ‘but the business should check that those who will be responsible for the execution of any plans are well-informed and up-to-speed on all communications, decisions and what is open for discussion.
‘The business should also provide the opportunity for this group to feedback and access specialist advice, even if it’s through an internal lead. Lastly, if you want to deliver and execute tough decisions well, you’ll need to demonstrate empathy at all levels – remember this isn’t the same as sympathy.’
Taking tough decisions as an EO leader – practical steps
It’s a lot to take in. So what five top practical tips would Kathie and Lisa offer to EO leaders taking tough decisions in challenging times?
1. Take time to take stock as soon as possible. Don’t get wrapped up in the day-to-day – you need to be heads-up to the horizon so you can limit any surprises. Check with your networks for any incoming trends or concerns to ensure nothing slips through. Chances are, other business leaders will be considering similar challenges so ask around and share what you can in exchange.
2. Speak to specialist advisors before you get to the crunch. Seeking their input early could save time, energy and keep the whole situation a lot calmer in the long term.
3. If you’re an EOT, fully utilise your Trust Board. Ask for their challenge and be prepared to listen and act on their questions. Trust Boards tend to have employees on them, frequently from positions that are not senior leadership, so their experience and perspective can be invaluable.
4. Engage with your governance and wider employee groups, where possible. If you’ve identified an incoming problem and they’re able to support with solutions (however creative) this may lead to a smoother outcome.
5. Don’t assume you’ll get everything right. Remaining alert to how any change is being managed and experienced by your employees can make a huge difference. If your business already supports open and effective two-way communication, fewer employees should be frustrated or begrudge any personal impact in the longer term. Graciously accept feedback from employees about their experiences, acknowledge where improvements could be made for the future and appreciate their honesty.
Want to know how JGA’s transition, people and governance services can support you and your EO business to take tough decisions in challenging times?
Doughnut economics – the challenge and opportunity for EO
Doughnuts, hosepipe and the future of the planet… not quite the mix you’d expect to find in your usual business lecture, but then Kate Raworth isn’t quite your usual business lecturer. She’s the influential economist focused on making 21st century economics fit for the ecological and social realities of today.
She was also the inspirational speaker at the Employee Ownership Association’s annual Robert Oakeshott Lecture at Bayes Business School in London last week.
Kate’s topic? ‘Redesigning business with Doughnut Economics’ and, specifically, the opportunity for employee-owned businesses to help society meet the challenge to change.
As she explained: ‘Currently, we are a world perilously out of balance, overshooting our planetary boundaries. We need new theories, business models, government policies and ways of living to turn this around…. We need to become regenerative and distributive to thrive.’
Her challenge to the audience of EOA members and advocates was clear: ‘Employee ownership is intentionally distributive by design – can it be regenerative too?’
Redesigning business to be a force for good
Our MD Jeremy Gadd attended the event and was intrigued by what he heard from Kate and her colleague Enrich Sahan, Business and Enterprise Lead at the Doughnut Economics Action Lab.
He was also interested in Kate’s response to the questions the audience asked, including his own about the most common ‘yes but…’ she hears when discussing doughnut economics with businesses.
The answer? ‘Yes but… the market or my shareholders won’t take it,’ she revealed. ‘The beauty is we’ve shown the design can change that.’
‘It was certainly a thought-provoking afternoon,’ Jeremy says.
‘What was so appealing about Kate’s presentation on doughnut economics wasn’t the academic interest it stimulated or the ‘yes but…’ question, but how easy it is to see why employee-owned organisations are by their nature well-placed to embrace the concept and vision that was shared. They’re the ideal recipients of doughnut thinking!’
Why? ‘Because when people understand the challenge they face, the choices they can make and are given the freedom to make these choices, empowering them through the culture of employee ownership releases so much positive energy,’ Jeremy replies.
‘This energy can be such a force for good and if, like me, you believe that business can be a force for good and that true change will only come through cultural entrepreneurship, then the scary challenges we face every day become exciting opportunities to embrace.
‘That feels a little easier when you have a genuine stake in the place where you work.’
Empowering employees to make a difference
Of course, for this to happen in practice, employee ownership needs to be more than a description on a piece of paper. The ability to maximise both its commercial and social potential requires a genuine culture of shared ownership across all levels of the organisation, which takes time and energy to evolve.
‘Currently, we are a world perilously out of balance, overshooting our planetary boundaries. We need new theories, business models, government policies and ways of living to turn this around…. We need to become regenerative and distributive to thrive’
Kate Raworth, ecological economist and EOA guest speaker
In our work at JGA, Jeremy says he’s often asked: ‘How do you know when a business has really embraced employee ownership?’. This question was on his mind as he listened to Kate’s view that ‘being an EO business is a very good starting point for redesigning business’.
His own view is that it starts with clarity about the responsibility, opportunities and rewards of EO.
‘People freely share information, ideas and challenge,’ he explains. ‘The employee owners have a clear sense of purpose, understand their role in the organisation and believe they truly matter and can make a difference.
‘You know when a business has really embraced EO because you can see, hear and feel it all around you. There’s a palpable belief that anything is possible.’
Looking forward to a ‘brilliant year’
The afternoon started – and closed – with the opportunity to network with other EOA members as well as meet several of the EOA’s team who had travelled down from Hull to host the event, which was sponsored by Brabners LLP.
This included EOA Chief Executive James de le Vigne who said he was delighted that the first in-person Robert Oakeshott Lecture for three years had attracted such a strong gathering of ‘employee ownership pioneers and advocates’.
Even without the prospect of more doughnut economics, he confirmed he was ‘very excited’ for the EO sector’s future as he predicted a ‘brilliant year ahead’.
Want to know how JGA’s transition, people and governance services can support you and your EO business?
The value of the NED as a ‘critical friend’ on your Board
If there’s one thing about board development that Adrian Wheale is passionate about, it’s the role of the ‘critical friend’.
As JGA’s Associate, Executive Resourcing, he sees first-hand how the ‘dissenting voice’ of an Independent Trustee or Non-Executive Director can make a senior team more effective, through the independence and challenge it brings.
So do organisations understand the true value of the board-level ‘critical friend’?
Although the ‘critical friend’ is enshrined in UK Corporate Governance, Adrian’s experience is that some boards still seem to only pay ‘lip service’ to it.
This is despite recent high-profile organisational failures showing the damage that can occur when a ‘critical friend’ is absent at a senior level – or when their voice is discounted and goes unheard.
The value of rigour and challenge
‘Too often, not enough thought is put into the fundamental engineering of our top teams and, similarly, not enough credence given to the critical friend role,’ Adrian reveals. ‘We promote on competency and technical skill, but rarely on acumen and independence of thought or views.’
He also challenges the assumption that liberal, inclusive organisations (and their leadership) are any less prone to the risk of group think than other types – or models – of business.
‘The critical friend’s ability to ask ‘Why?’ – or ‘Why not?’ – at key moments brings invaluable rigour and challenge, ensuring that a fail-safe exists,’ he explains. ‘Engineering a board from a more diverse base will address the risks of group think, but it’s the critical friend who adds ‘steerage’ to the process.’
‘The critical friend’s ability to ask ‘Why?’ – or ‘Why not?’– at key moments brings invaluable rigour and challenge’
Adrian Wheale, Associate, Executive Resourcing
Strengthening board diversity of thought
Adrian’s appreciation of the role of the ‘critical friend’ in successful board development reflects his commitment to strengthening diversity of thought at senior levels – and ensuring that it is captured in a useful way.
Yet genuine diversity of thought doesn’t just happen. It starts with an organisation’s Constitution (or equivalent) and should run through its purpose, values, vision and goals. It must be revisited regularly to sustain its impact on leadership culture and supported to add value and grow.
‘Diversity of thought should be a separate agenda item,’ Adrian asserts. ‘If it isn’t called out it isn’t valued.’
Identifying the gaps an NED ‘critical friend’ could fill
Adrian’s executive resourcing experience has shown him why being able to assess a senior team’s psychological and values balance is fundamental to building stronger boards.
Psychometrics can be very useful when profiling their mental diversity and identifying the gaps that a ‘critical friend’ could fill.
‘Fixed-term tenure on boards is a good way to ensure things don’t get stale as well as appointing a truly independent Non-Executive Director, Trustee or Employee Rep to challenge your thinking as a critical friend.’
The right board directors in the right roles
The good news is that Adrian’s not alone in his appreciation of NEDs, as demonstrated by last weekend’s Sunday Times Non-Executive Director Awards where the winners were, he says, ‘exemplars of getting this right’.
So what should you do next?
At JGA, we have a track record of successfully supporting EO and values-led organisations with their board composition and development – including during and after EO transition. Our Executive Resourcing and Independent Trustee Resourcing services connect clients with the highest-calibre candidates for their senior roles. We also enable organisations to build Trust Board effectiveness.
To find out more
EO is different – your leadership development should be too
Leading in an employee-owned business – it’s different. Different responsibilities, different opportunities, different rewards. Ask those who do it well and they’ll confirm that leading employee owners requires a different mindset and skills to leading in a ‘conventional’ business.
Yet the need for EO-specific leadership development is often ignored.
Or it was, until now – because it was recognising transition’s impact on both new and existing leaders that led J Gadd Associates to partner with Telos and the Employee Ownership Association to create our latest leadership development programme last year.
Recognising the impact of transition
‘How to be an empowering leader or manager in an EO business’ was launched via EO Learn as five virtual half-day sessions run over three months from last September.
Designed to enable delegates to foster and develop a growth mindset, as well as engage, inspire and empower employees, feedback from the first cohort is strong.
Registrations for the next course, starting in March, are now open on the EOA website, and JGA Lead Associate Garry Davis is excited.
Drawing on his experience of leading and enabling others to lead and energise engagement, in an EO business, he’s worked closely with Telos to design and deliver a programme that can flex to individuals’ needs.
‘How to be an empowering leader or manager in an EO business’ has also been ‘sense-checked’ by other EO businesses and influencers via the EOA’s membership council and board, to ensure it meets the bar for EO Learn.
‘Often, during transition, the focus is on the financial and legal transaction, but founders and owners should also be looking at their leaders’ capacity to lead themselves and others in a co-owned business’
Garry Davis
Realising the benefits of a growth mindset
The first delegates came from organisations at all stages of EO transition, and quickly established trust and rapport. This generated high levels of openness, challenge and encouragement as they learned from each other’s experiences. Garry is confident the next cohort will do the same.
‘How to be an empowering leader or manager in an EO business’ meets a clear need with its blend of focused input, practical application and facilitated reflection on real experiences to bring the learning to life.
So why was Telos the right partner for J Gadd Associates?
‘For me, Telos’s extensive experience in leadership development across a wide range of organisations complements that of JGA. This shared expertise, combined with our understanding of EO transition, people development and what it takes to lead co-owners effectively, sets this programme apart.
‘Telos’s Growth Mindset psychometric tool and the opportunity to network and learn from other EO leaders are also core strengths.’
Learning from the experience of other EO leaders
In fact, Garry identifies the ‘hunger to learn from their peers’ as a key contributor to its early success.
‘The first delegates quickly built trust and rapport, and we saw high levels of openness, challenge and encouragement. The Growth Mindset tool really challenged their current thinking and transformed limiting beliefs.’
So who is ‘How to be an empowering leader or manager in an EO business’ for?
Not only leaders in transitioning and newly EO businesses, but also those in established organisations who might be new to EO or their team. By addressing the impact on leaders when businesses become employee-owned, the course supports them to grow.
'Telos’s extensive experience in leadership development… complements that of JGA. This shared expertise, combined with our understanding of EO transition, people development and what it takes to lead co-owners effectively, sets this programme apart’
Garry Davis
Working with trusted partners to secure EO success
‘Often, during an EO transition, the main focus is on the financial and legal transaction,’ Garry reveals, ‘but founders and owners should also be looking at their leaders’ capacity to lead themselves and others in a co-owned business, to secure their future success.
‘At JGA, we understand the impact of transition on leaders and why a growth mindset is essential when preparing for change. If that impact isn’t addressed, it can limit the organisation’s capacity to energise the culture and realise the full potential of becoming EO.’
Next steps
The next fully virtual ‘EO Learn – How to be an empowering leader or manager in an EO business’ development programme starts on 3rd March 2022. You can find out more, and register, via EO Learn on the EOA website.
If you would like to know more about how JGA can support you with our Transition, People and Governance services, please get in touch here
Employee Ownership Trustee Appointment Service
Why Independent Trustees are such valuable assets
Over half the transitions to employee ownership trusts have occurred since 2017, with the White Rose annual survey reporting on EO Day last June, that 100 new businesses had converted in the previous 12 months. There are an increasing number of founders and owners choosing the employee ownership model for their businesses. These choices often secure long term sustainable employment, rooted within communities and committed to demonstrating positive values.
There is a common requirement for an employee ownership trust to appoint a mixture of trustees, enabling strategic oversight on behalf of the beneficiaries, with at least one of these being independently appointed. Sometimes these needs can be fulfilled from within your current network, but that may not bring the diversity and perspective your trust board needs. With more transitions to EO and more boards maturing, actively succession planning and challenging their effectiveness, we believe the need for high quality independent trustees will continue to grow.
We recognise the value and importance of effective governance, and the assurances it can bring to organisations. We believe that with independence comes greater integrity, an asset to any organisation, ensuring that business values and purpose are effectively nurtured. We know how independent trustees can spark new conversations, generate discussion and transfer their knowledge to new boards and environments. In addition to their specific areas of expertise, we also believe that effective independent trustees bring the benefits of fresh perspectives, cultural challenge and occasionally a healthy scepticism.
Our joint venture with Russam is focused on supporting employee owned organisations to find the best match for their Trustee Board. Since opening for registrations at the start of this year, over 300 candidates have joined, seeking to share their expertise, spread best practice and promote good governance.
Whether you are a current trustee, have been a trustee previously or are looking to become one, why not take a look at the role and register to ensure you’re in the mix for future opportunities.
We’re very excited to be launching this service, and can’t wait to support employee owned organisations in finding the right trustee for them. Kathie, our lead associate for this service is available to send you further details and discuss your needs in more detail, so feel free to drop us a line if you’re interested.
Jeremy speaking at the Stir to Action Festival
1-3 September virtual event - A Playground for the New Economy
“It’s wonderful to have been asked by Stir to Action to support the Festival, particularly to highlight one of the fastest growing ownership models. I’m pleased to be able to share my experience and views as a result of supporting the EO sector for the last 7 years”
“I really appreciate the chance to help spread the word and contribute to the debate around how to help organisations seize the opportunities available to build back better.”
Jeremy is joining Deb Oxley OBE for a 1 hour discussion as part of a number of sessions over the 3 day virtual event.
Stir to Action's Playground for the New Economy Online festival is taking place 1-3 September, with a new line up announced for 2020. £10 online festival tickets are now on sale at www.stirtoaction.com/festival
+ Provocative conversations
+ Interactive discussions
+ Face-to-face networking
+ More!
Join us to be challenged and inspired by our unique line-up of contributors, all offering provocative ideas about, and innovative alternatives to, the current political and economic landscape.
We're online this year we’re pulling out all the stops to give you an amazing festival experience, even without the field. That means you can join in from WHEREVER YOU ARE.
Adrian Wheale joins JGA
Adrian shares his expertise and philosophy with JGA
It was in my late 20s when “the penny dropped” that .... actively linking people to enterprise was the key to generating commercial growth. Leaving behind my prior command and control influences of corporate life, I made a 180 degree career-turn.
The result = successfully spending the next 35 years + actively embracing that insight... both as a senior exec and then as an owner-director in the executive selection/people services/ human capital and dispute resolution domains.
In essence, ethically partnering growth by focusing on quality boards and top-teams, critically, with quality candidates that “fit”. This always was, and still is, my value proposition.
I like to see (and complement) that DNA of inclusive leadership & mutuality, values & value, engagement & enterprise running through a business at the core. That’s when 2+2=5, in my experience. NB It was over twenty five years ago when I was first exposed to EO via the RSA’s “Tomorrows Company” regime, led by Unipart and John Lewis, and it’s been an enthusiasm ever since.
Bringing that up to date was meeting Jeremy clientside when he was advising and I was recruiting, and , yes .... 2+2 did =5!
We are delighted to have Adrian join us and excited to have his support in developing a new service for our clients
Leadership Succession in an Employee Owned Business
Increasingly, business owners are making the transition to employee ownership to address ownership succession.
Yet, many remain challenged with leadership succession. And whilst you can find a plethora of leadership programmes – to equip people with leadership skills – few prepare people to lead an organisation. None prepare leaders to lead an employee owned organisation.
To address this, we have partnered with Telos Partners to design and create the Future Leaders Programme for Employee Owned Businesses with input from the Employee Ownership Association and employee owned businesses.
As part of the EO Learn offer, launched at the conference in November 2019, we're proud to have supported the development of this course aimed at senior leadership succession and planning.