This entry won the 2012 Peer Award “Philanthropy” category
Ref: 12-002
Burdens / A Better Way To Do Business
coownership / delivering profit / sharing success
Overview
Burdens is a unique distributor providing products and services to civil engineering, construction and environmental markets. It delivers profit for the benefit of its employees and the benefit of a charitable foundation.
Through the creation of an employee ownership model and the development of a Charitable Foundation the business has created a model that rewards its own people, the society in which the business operates and the wider world. This model has underpinned a long term sustainable success for the business.
As a result Burdens is now at the forefront of positively challenging the role of business within society.
Impact
Over £5m has been donated to charitable causes at home and overseas. The most obvious impact is on the lives of abandoned and blind children at the school and orphanage built in Burkina Faso, one of the Worlds’ most economically challenged environments.
Within the organisation every person is a shareholder and has an opportunity to influence the direction of the business and share in its success. Ownership is a key motivator and has driven a significant reduction in sick leave; increasing employee retention and length of service.
Growth in the last 10 years has been substantial circa. £100m to £320m.
Innovation
The business model was developed in 1974 and came about when the founder of the business gifted a large percentage of his shareholding to create a charitable foundation. The change was both visionary and altruistic and has had significant impact in the business culture.
Key to this are the values designed to unlock success and the motivation generated from the ownership model.
The innovation is the notion of ‘seeking a better way to do business’ through combining the desires of all the business stakeholders with the needs of the wider society in which it operates.[/one_half_last]
Insight
The issue faced with our model is the on-going challenge of ‘communication’.
A lack of understanding internally of the benefits of an employee owned business affected the initial take up of shares and the opportunities they represent. There was a low level of ‘buy-in’ to the ‘give as you earn’ scheme and benefit that could be accrued i.e. doubling the donation.
Externally, clients did not grasp the principles behind the Foundation and what it represented. Many stakeholders believed that we were a ‘not for profit’ charity!
The lesson is to use the model more effectively as a positive marketing tool.
Inspiration
The negativity surrounding business, driven by the banking culture, has destabilised the view of profitable business.
Linking successful business with community spirit is an important move to secure the continued acceptance of ‘profit’ and the economic welfare it seeks to enhance. Sharing wealth through economic growth, locally and further afield, is the phenomenon that has to be borne out of the recession and the austerity measures. The view is that there is an imperative to better balance longer term shared success against the old culture of delivering individual short term profit.
There is a better way to do business![/one_half_last]
The Speaker
Kevin Hancock is Corporate Development Director at Burdens and has worked for the organisation for 25 years. He is a member of the South West Regional Council of the CBI and acts as a Burdens representative at the Employee Ownership Association.