Empowering entrepreneurs to keep companies independent and value driven
Steward-ownership defines the sustainable legal structures that instill a company’s purpose into its legal DNA
Key principles of steward-ownership
Steward-ownership ensures that the control of the company is not a commodity anymore. The steering wheel – the majority of the voting rights – of self-determined companies lies in hands of people who are connected to the mission of the company.
With steward-ownership profits are a means to an end, not an end in itself. Instead profits directly serve the purpose of the company. They are used to pay back investors, re-invested in the company, or donated to charity.
Why does steward-ownership matter?
Our conventional approach to private ownership drives short-term profit maximization at the cost of economic, societal and environment needs. Steward-ownership represents a historically grounded alternative to this approach. Viewing profits as a means to an end and not the end itself, steward owned companies exist to serve their mission, employees, and customers.
A novel, but not new, idea
Steward-ownership is a historically tested approach to traditional ownership. Many companies – from Bosch to John Lewis – have implemented the principles of steward-ownership into their corporate structure to protect their mission and organization.
As a steward-owned company, Bosch has been able to prioritize a long-term growth over short-term profitability, making them more competitive, innovative, and environmentally conscious.
Because John Lewis is owned by a Partnership trust for its members, employees share the responsibilities of ownership as well as its rewards: profit, knowledge, and power.
Steward-ownership enabled the founder of Waschbär to exit responsibly, while ensuring the company’s purpose is permanently protected and those most able remain at its helm.
We’ve gathered the most common questions from entrepreneurs, investors, and business leaders about the principles of steward ownership, steward-ownership legal structures, and aligning financing with alternative ownership models.
What qualifies as mission driven?
A company’s mission is the reason it exists beyond generating profits or benefitting investors and founders. A mission defines why a company exist, the impact it wants to leave, and the customers’ needs it seeks to fulfill.
How do we become steward-owned?
The Purpose Foundation exists to help entrepreneurs and business leaders navigate the transition to steward-ownership and to connect mission driven capital with the right businesses.
What evidence is there that steward-ownership works?
Generations of steward-owned companies have empirically proven that long-term independence enables companies to pursue their business and societal goals in the most effective way.
Although a seemingly novel idea, steward-ownership is a time-tested model. Research shows that steward owned companies not only have better employee retention rates and pay higher wages, research shows compared to traditional companies steward-owned companies have a 6x higher survival rate after 40 years.
How does this differ in the US and EU?
Principles of steward-ownership are the same globally. The legal implementation and tax liabilities differ subtly across jurisdictions. Learn more about steward-ownership structures
Rethinking Ownership in the 21st Century
The Purpose Foundation is dedicated to helping companies stay independent and mission driven for the long-term through steward-ownership. For a comprehensive guide to the current state of ownership research, financing solutions for purpose driven companies, and examples of successful steward-owned companies, download the booklet here.