STEWARD OWNERSHIP
Future of governance
What is steward ownership?
Steward ownership is a form of corporate governance and ownership that prioritises a company’s long-term mission and values over short-term profit maximisation.
In this model, companies are owned or governed by stewards (often charitable foundations) who are committed to upholding the company’s core mission, ensuring ethical and aligned decision-making, and distributing funds for good.
Profits are reinvested, used to cover capital costs, shared amongst stakeholders (ie. employees) or donated for charitable purposes.
Why does it matter?
Steward ownership creates value on a number of different fronts:
Long-term sustainability
It encourages long-term thinking over short-term profits, supporting more resilient organisations and economic systems.
Mission preservation
It helps preserve a company’s original mission and values over time, even if leadership changes.
Stakeholder consideration
Steward ownership promotes consideration of all stakeholders – e.g. employees, customers, communities, and the environment – not just shareholders.
Wealth distribution
Profits are reinvested, donated or shared among stakeholders rather than concentrated among a few shareholders.
Innovation and long-term thinking
Without pressure to deliver purely financial results, companies can invest in long-term innovation and development.
Independence
It allows companies to maintain their identity and kaupapa, resisting pressure from external forces.
Values Match
An unambiguous signal to partners and customers with values alignment.
Ethical decision-making
Balancing purpose and profit can lead to more ethical/values aligned business practices and decision-making.
Trust and reputation
Companies committed to their mission and stakeholders often build stronger reputations and customer trust.
Liquidity and legacy
Steward ownership offers founders and shareholders liquidity and legacy – a financial and a social return on their investment, and it offer broader benefits as well, including:
Increasing available philanthropic funds
Keeping ownership, capital and employment local
Supporting leadership to take a long-term or intergenerational approach to thinking and planning
Addressing a gap in exit options, providing a pathway that supports legacy and liquidity in succession/business transition.
Aligning with te ao Māori and a broader societal move towards degrowth and collective versus competitive models
Steward ownership has the potential to positively impact employees, the economy, and society, as demonstrated in other markets, most specifically Denmark.
Denmark has the highest number of steward owned companies in the world. Research suggest this benefits the economy, employees, companies and community through:
More stable profitability with a stronger capital basis, higher equity ratio and higher reserves
Similar or higher levels of productivity
Increased survival probability: 60% versus 10%
More resilience to financial crises and fluctuations
Significantly higher levels of invest in research and development
Higher average salaries with more stable, long term employment
4x higher ownership stability, and
40% lower management fluctuation
The time is now
We believe now is the right time to build the steward ownership movement in Aotearoa and Generous Ventures intends to lead the way.
The ‘silver tsunami’ of retiring business owners is upon us, we are in a period of significant economic, environmental and social instability, there is growing inequality, and increasing dissatisfaction with extractive corporate ownership models.
We are well positioned to take on Steward ownership, with a tax environment that treats this model of exit favourably, and a culture of innovation in ownership.
We think New Zealand could, and should, be a leader in this space and we’re working to build the resource, networks and knowledge to do it well.