You Don’t Need an EOT to Have a Voice

Happy EO Day!

Since our Employee Ownership Trust (EOT) blog post went live, the obvious has dawned on me. Doh!

When discussing the role of an employee council in an EOT context, we said:

“To better inform the EOT’s decision-making process, an employee council is often established to provide a channel of communication between employees and directors and between employees and the trustees of the EOT. This structure ensures that employees’ views are considered when certain decisions are made or when certain matters are discussed.”

What dawned on me is that having an employee council is not unique to EOTs. Any company can establish an employee advisory committee, council, forum or panel. Indeed, maybe the real EOT insight is that you don't need an EOT to reap the benefits of an EOT.

Crucially, I am not advocating a full-fat UK-style works council, the kind common in Europe, with statutory force and various employment rights.

Instead, I want to highlight the benefits of establishing an employee panel that acts as a conduit between employees and management, promoting a culture of inclusivity and shared ownership akin to an EOT.

Workforce Engagement

In 2021, research commissioned by the Financial Reporting Council examined how, following the UK Corporate Governance Code, companies have been incorporating the workforce voice within the boardroom. The law firm Hogan Lovells summarised the findings well.

Workforce engagement: A look at emerging best practice

The findings highlighted that the more successful outcomes of employee engagement came from companies that properly considered why they were facilitating board-level employee voice.

The Social Market Foundation also did some great work on this in their 2021 research paper A stake in success. 

For every company, big, small, private, listed, EOT-owned or not, here are some of the ‘why’s' for considering an employee advisory panel (EAP).

Enhanced Employee Engagement

EAPs provide a platform for employees to voice their opinions, concerns, and suggestions. This active participation can significantly boost employee engagement, as individuals feel their contributions are valued and impactful. Engaged employees are more likely to be motivated, productive, and committed to the company's success.

Improved Decision-Making

Incorporating diverse perspectives into the decision-making process can lead to more well-rounded and effective outcomes. EAPs bring together employees from various departments and levels, ensuring that a wide range of insights and experiences are considered. This collaborative approach can help management make more informed and balanced decisions.

Strengthened Company Culture

EAPs can play a crucial role in nurturing a positive company culture. By promoting transparency and open communication, panels help build trust between employees and management. This trust is essential for fostering a sense of community and belonging, which are key components of a strong company culture.

Enhanced Retention and Recruitment

Companies that prioritise employee ownership and engagement are often seen as more attractive employers. An EAP can enhance a company's reputation as a great place to work, helping to attract top talent. Additionally, employees who feel heard and valued are more likely to stay with the company, reducing turnover rates.

Increased Innovation

When employees are encouraged to share their ideas and feedback, it can lead to increased innovation. EAPs provide a structured way for employees to contribute their creative solutions and improvements. This can drive continuous innovation and help the company stay competitive in the market.

Establishing some sort of EAP is a strategic move for companies looking to embed employee ownership themes.

Additional Insight

I recently hosted a tech start-up speed dating-styled forum. One of the most fascinating insights was how alignment of values between employer and employee was vital for new entrants to the workplace. I was repeatedly told that if there is a mismatch between the values of the candidate and those of the potential employer, the candidate would not accept the job - even if more money was on offer.

So values matter. And therefore, awareness of those values matters just as much, if not more so. Companies that don't make the effort to understand and engage with their workforce could stand to lose out in lots of small (but cumulatively important) ways. Having an EAP should help address those differences and promote a different and more meaningful engagement with employees.