The 11th Annual Vermont Employee Ownership Conference was held on Friday, June 7, 2013 at Champlain College in Burlington, Vermont, with nearly 150 attendees, including those from established employee-owned companies, those interested in establishing some form of employee-ownership, public officials and others.
This year's keynoter was Loren Rodgers, Executive Director of the National Center for Employee Ownership, speaking on "The State of Employee Ownership 2013." Author of dozens of articles, Rodgers speaks extensively about topics including communications, ESOP education, employee committees, business literacy, building and maintaining enthusiasm, current research, and corporate governance for employee ownership companies. He has a master's degree in public policy from the University of Michigan, where he studied employee ownership and international development with a focus on Slavic Europe. Before joining the NCEO in 2005, Rodgers was a senior principal and co-owner of Ownership Associates, a employee ownership consulting firm in Cambridge, Massachusetts, where he worked for 10 years.
About the Event
The full-day conference is designed for those who want to learn more about how employee ownership can work for their business as well as members of existing employee-owned companies. Our 2014 conference will be held on Tuesday, June 3 at St. Michael's College. Stay tuned for more information.
Who benefits from attending?
- Business owners interested in learning more about employee ownership as an exit strategy
- Members of existing employee-owned companies
- Economic development professionals
- Bankers, accountants, attorneys and financial planners
- State legislators and students
- Anyone interested in employee participation or sustainable business models
The 2013 Conference Agenda
7:30 to 8:30 -- Registration and Continental Breakfast
8:30 to 9:30 -- Morning Plenary
Keynote address: The State of Employee Ownership 2013
Loren Rodgers, Executive Director, National Center for Employee Ownership
Employee ownership is a potential answer to essential challenges facing businesses and society, but its future course depends on strong forces, such as the demographics of an aging population, severe constraints on the federal budget, the conclusions of emerging research, global developments, and the ability of the employee ownership community to make a compelling case. Where are we now, and what can we do to help unleash more of employee ownership’s power?
|NEWCOMERS||Anyone new to employee ownership|
|ESOP EE||Those who work in companies with an ESOP (Employee Stock Ownership Plan)|
|ESOP L||ESOP company leaders|
|CO-OP||Those who work in worker co-ops or are interested in this form of employee ownership|
9:45 to 11:00 -- Workshops, Session A
1. Introduction to Employee Ownership
Don Jamison, Vermont Employee Ownership Center; with Margo Baldwin, Chelsea Green Publishing; George Beato, Champlain Oil and PT360; and Joe Marx, Principal Financial Group
This is the place to start if you want to learn the basics about employee ownership: the reasons for considering it, the basic structures, and the ways to implement it. You’ll learn about the two most common forms of employee ownership – Employee Stock Ownership Plans (ESOPs) and worker cooperatives, and discover which structure might work best for your company. This year, we will hear two company founders tell the story of how their businesses became employee-owned.
2. From Employees to Owners: Developing Responsibility and Accountability in Worker Cooperatives
Melissa Hoover, US Federation of Worker Cooperatives
This session is for employees and members of established worker cooperatives to discuss issues they are currently facing. We'll begin with a facilitated conversation about the small and large differences between the roles and responsibilities of employees vs. those of co-op members. Then we will move on to a discussion of creating a culture of responsibility that supports employees transitioning into worker-ownership. We will also include as examples some accountability systems that work in worker co-ops.
3. Hot Topics for Established ESOPs
Barbara Clough, Blue Ridge ESOP Associates; Chuck Coyne, Empire Valuation Consultants; Dave Fitz-Gerald, Carris Reels; Rob Schatz, Schatz Brown Glassman Kossow LLP
A panel of ESOP leaders will discuss the latest governmental developments, and give the latest updates on legal, administrative and valuation topics. ESOP company leaders won’t want to miss this hot-off-the press session!
4. So I'm Owner: What Does That Mean, What Do I Get, and What Is Expected of Me?
Alex Moss, Praxis Consulting Group
Following a very brief review of legal ownership under the ESOP form, we will take a look at the different ways we talk about ownership, using examples and analogies -- from houses and cars, to other forms of stock ownership. In what ways is employee ownership similar, and different? What does it feel like to be an owner? And how do we act, or hope people will act, as owners? We will devote the balance of the session to a discussion of practical ways to engage employee-owners in understanding what they can do as owners, not just formally (voting, serving in formal postions), but more importantly on the job, day in and day out, addressing the core question: How is my job different, and how is it not different, now that I am an owner?
ESOP EE, ESOP L
5. A Conversation about the Keynote
Loren Rodgers, National Center for Employee Ownership; with Victor Aspengren, Prairie Capital Advisors
How does what Loren Rodgers told us about the current state of employee ownership relate to life inside employee-owned companies? What do the long-term trends suggest for future of the employee ownership movement? Victor Aspengren, longtime ESOP leader and advisor (and the outgoing Chair of the Board of the NCEO), will facilitate this conversation with Loren.
11:15 to 12:30 -- Workshops, Session B
6. Forming an ESOP: A One-Act Play
Tabitha Croscut, Steiker, Fischer, Edwards and Greenapple; with Barbara Clough, Blue Ridge ESOP Associates; Chuck Coyne, Empire Valuation Consultants; Rich Glassman, Schatz Brown Glassman Kossow; and John Murphy, Atlantic Management Company
This session will explore what actually happens during the process of creating an Employee Stock Ownership Plan (ESOP). Who needs to be involved and what are their roles? Through role-play, this session will show you a compressed version of the process, starting with an owner learning about what ESOPs are, bringing the team together, negotiating the ESOP's stock purchase and finally announcing the ESOP to all employees. Along the way we will stop to explain the steps and key terms. If you understand a process better by seeing it than by reading or hearing about it, this is a good session for you!
NEWCOMERS, ESOP EE
7. The Equal Exchange Co-op Story
Rodney North, Equal Exchange
Equal Exchange is best known for its Fair Trade coffee and other products, but it is also one of the oldest, largest, and most successful worker co-ops in the U.S. Worker-owner, former board director and spokesperson Rodney North will share the story of its start-up phase, structure, culture, and capitalization. Rodney will also give a snapshot of how the co-op is faring today financially, commercially, and intangibly as a still-growing $50 million, employee-owned & governed co-operative with over 100 members spread from Boston to Seattle.
8. Does Your Company “Have” An ESOP Or “Are” You An ESOP?
Victor Aspengren, Prairie Capital Advisors
There are many different ways that companies structure and maintain their ESOP. It is great to have multiple choices, but the multiple choices can create havoc within an ESOP organization. This session will address the issues that can arise from a lack of clarity on how the ESOP is viewed by leadership, employee owners, and service providers. This session will be interactive, so bring your questions and ideas to share with the group.
ESOP EE, ESOP L, NEWCOMERS
9. The Life of an ESOP Communications Committee
Linshuang Lu, Praxis Consulting Group; with Bruce Bumpus, Veronica Ortiz, Pat Roy and Rene Taillon from Web Industries Hartford; and Ben Winters, CAD Cut.
Come to this session to learn general principles of team dynamics and to hear about the experience of Web Industries’ ESOP communications committee. We will learn about their committee structure, their main activities, the company's application of the Plan, Do, Check and Adjust cycle, and how these have developed over time. In particular, we will hear about the experience of introducing Web Industries' dynamic ownership culture into a recent Vermont-based acquisition, CAD Cut.
ESOP EE, ESOP L
10. Best Practices in Corporate Governance for ESOP Companies
Rob Schatz, Schatz Brown Glassman Kossow; with Dave Fitz-Gerald, Carris Reels, and Cindy Turcot, Gardener’s Supply Company
We will discuss the legal and practical aspects of corporate governance issues in majority and minority ESOP-owned companies, focusing on the use of internal trustees and/or fiduciary committees. We will review the roles and responsibilities of senior management, board of directors and trustees in day-to-day and transactional activities. In concluding what “best practices” might be and the options available in designing a “best” program for your company, senior managers from two well-known companies with mature ESOPs, Gardener’s Supply and Carris Reels, will discuss how corporate governance issues and practices have evolved and are being addressed at their companies. They are following different paths, but, to paraphrase a well-known adage: “Corporate governance, like life, is a journey, not a destination!”
ESOP L, NEWCOMERS
12:30 to 1:30 -- Lunch
1:30 to 2:45 -- Workshops, Session C
11. Going Co-op: Converting an Established Business into a Worker Cooperative
Melissa Hoover, US Federation of Worker Cooperatives; Don Jamison, VEOC; Gloria LaBrecque, Cooperative Fund of New England; Dunbar Oehmig, Red House; Adam Trott, Valley Alliance of Worker Cooperatives
Transforming an established business into a worker co-op can be a great way to transition ownership from present owners to employees, especially for businesses that are too small to be able to afford an ESOP and/or where greater workplace democracy is an important goal. We will begin with an overview of the process, hear the story of a successful co-op conversion, learn what lenders look for when asked to finance ownership transfers, and have a frank discussion of the challenges – and the potential rewards of this path.
12. Sharing the Financials -- A Key to Making Ownership Real
Victor Aspengren, Prairie Capital Advisors; with Rodney North, Equal Exchange; and Patti Vaughan, King Arthur Flour
Sharing the financials is not a guaranteed slam dunk. Simply reporting the monthly financials is a good first step, but there is so much more that can be done. If you want your employee owners to truly act like owners, this session will give real working examples and best practices that you can utilize in your company. This will be an interactive session.
13. Tools to Build Your Culture
Loren Rodgers, National Center for Employee Ownership
This session will provide real-life ideas that employee-owned companies have used to create effective ownership cultures, from overall strategy to the small things that still matter. Designed to be thought-provoking and ready to use, attendees will leave with many fresh ideas to bring home to their own companies.
14. ESOP Terminology, Jeopardy Style
Barbara Clough, Blue Ridge ESOP Associates; Tabitha Croscut, Steiker, Fischer, Edwards & Greenapple
Test your knowledge of ESOP terms and concepts (and learn a few new ones too) in this fast-paced, action-packed and interactive session! Know the difference between “distribution” and “diversification”? How about “ESOP” and “ESOT”? If you are new to ESOPs, need a refresher course on ESOP terminology or simply want to learn a new way to communicate your ESOP at your company, attend this session to familiarize yourself with these and other specialized terms, acronyms and concepts. And if you need additional incentive to attend - we've got prizes!
ESOP EE, ESOP L
15. Succession Planning for Long-Term Viability of Employee Owned Companies
David Ferraro, Carris Reels; Ted Freeman, Praxis Consulting Group
Long-term viability of employee-owned companies depends on having robust plans for developing talent and preparing for leadership succession. This session explores why succession planning matters in an employee-owned environment and the best practices in succession planning. Future Carris Reels CEO David Ferraro will also discuss the succession planning process at his company, along with the unique challenges and opportunities he has faced going through the process.
ESOP L, NEWCOMERS
3:00 to 4:15 -- Workshops, Session D
16. Basics of Valuation and Financing for Ownership Succession
Don Baker, KeyBank; Joe Marx, Principal Financial Group; John Murphy, Atlantic Management Company
We will learn in this session the basics of how valuators determine the value of privately-held companies, and how lenders evaluate loan applications for transfers of ownership. This session will be valuable to anyone considering ownership succession for their company – or anyone who wants to better understand how valuators and bankers think!
17. What Can ESOPs and Co-ops Learn from Each Other?
Melissa Hoover, US Federation of Worker Cooperatives; Loren Rodgers, National Center for Employee Ownership
While ESOPs and worker co-ops may sometimes seem to be distant cousins, they both are forms of shared ownership and have much to teach each other. In this session, we will take a look at the underlying principles of these forms, not shying away from the differences. Then we’ll consider possibilities for cross-fertilization of ideas for leadership development, culture building, corporate governance, financing buy-outs of retirees and other core employee ownership issues. Your contributions to the conversation will be welcome!
A Special Screening of We the Owners: Employees Expanding the American Dream
Discussion led by Cécile Bétít, Independent Researcher, and Alex Moss, Praxis Consulting Group
We the Owners captures stories from the founders and employees of three companies – New Belgium Brewing, Namasté Solar, and DPR Construction – that use three different forms of employee ownership (ESOPs, stock and stock options, cooperatives). The film shares the worker's perspectives on these shared ownership structures, and examines how the companies have faced important and sometimes difficult internal issues.
4:15 to 5:00 Closing Reception