Steward ownership: ownership structure with impact

For several years there has been a demand from the market for a form of company to pursue social impact. This development has already led to the initiation of a legal regulation for the legal form BVm. We told you earlier what this legal entity should look like. The idea is that a company that is allowed to use the legal form BVm is obliged to use its activities to pursue or promote a goal of social importance as described in the articles of association, without that goal description (completely) excluding the possibility of making distributions of profit or reserves. As of 2021, the idea of a BVm has not moved beyond the internet consultation stage. Thus, establishing a BVm is not (yet) possible.

Perhaps the fact that this legal form has not yet been introduced has to do with the insight that in practice a separate legal form is not necessarily needed to make an impact. Even within existing legal forms (such as BV, NV, cooperative) an enterprise can be designed that fulfills that purpose. One of the ways to arrange this is steward ownership.For a number of years, this phenomenon has also been on the rise in the Netherlands.

Service to purpose

Steward ownership offers an alternative approach. It focuses on the company itself as the most important stakeholder, while the purpose of the company is leading. The approach also focuses on long-term orientation, where the pursuit and maintenance of the specific goal is paramount. Steward ownership is still relatively little used today. It requires innovative approaches to integrate principles such as self-governance into corporate culture. Each steward owned company has its own unique purpose. What these companies have in common is the belief that profit is only a means to support the goal, and not the ultimate goal.

Some well-known examples of Dutch steward owned companies include Coffeecompany, de Groene Amsterdammer, Jaarbeurs Utrecht, Madurodam, Nyenrode University and Royal HaskoningDHV.

Importance of innovation

In general, it can be seen that at steward owned companies there is a specific focus on long-term value creation, not primarily for shareholders, but also for other stakeholders such as employees or the public interest. At a time of increasing emphasis on the pursuit of broader prosperity and value-creation for a wider group of stakeholders, steward ownership provides a framework for infusing these principles into corporate decision-making processes.

Want to know more?

For entrepreneurs looking for an alternative to traditional corporate structures to fundamentally redefine the rules of the game of business, it is recommended that they look at the option of steward ownership.

Contact

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