Showcasing the Best of Welsh Business

Employee Ownership and Your Business: An Expert Panel Discussion

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This month, commercial law firm Darwin Gray and alternative finance provider Thin Cats brought together a panel of experts to discuss the benefits and considerations of transitioning your business to being employee owned – an Employee Ownership Trust (EOT).

Hosted by Robert Lloyd Griffiths, the event explored the legal, financial, tax and practical considerations around an EOT structure, including first-hand experience from an employee-owned business.

The panel’s experts included Emily Shingler (Darwin Gray), Richard Bowles (Thin Cats), Martin Knight (BPU Accountants), Paul Cantrill (Cwmpas) and Mark Willis (Wavehill).

An overview of some of the takeaways from the event:

Paul Cantrill, Cwmpas:

“Compared to a trade sale, most of the aspects of the sale are under the control of the current owners of the business, particularly at a time when there are uncertainties. Being able to deal with people that you know and trust and work with day-to-day is very appealing”

“Making sure the financial structure for the sale can be financed is a critical part”

Emily Shingler, Darwin Gray:

“Broadly, a company has three main options when it comes to determining trustees. The most popular choice tends to be a corporate trustee – when a new company is incorporated and the board of directors of that entity become the people who make the decisions. The main advantage of this is the benefit of limited liability.”

Richard Bowles, Thin Cats

“Preparation is key. Not just of financial information, but also the non-financials.”

“Assembling a good quality team is key. Having legal, finance, tax and operational elements at the outset is fundamentally important”

Martin Knight, BPU Accountants:

“There are lots of requirements to be met along the way. There is a requirement to claim the tax relief once the structure has been formed.”

Mark Willis, Wavehill:

“It’s important that you develop an in-depth knowledge of EOTs, communicating that clearly to your staff, including the benefits, not just the financials.

“The EOT model really demonstrates our business’s commitment to social values. While this could be considered a less tangible benefit, this has made a difference to our top line”

“Our transition to an EOT has had a significant impact in regards to staff retention and recruitment”

Richard Bowles, Thin Cats:

“Engaged employees are often more productive employees. If your business has a strong culture and legacy that you want to pass on, an EOT is definitely worth considering”

If you are planning your succession or exit strategy and are considering an EOT, get in touch for a free initial chat with the Corporate and commercial law experts at Darwin Gray: 029 20829 100.