Single-Foundation Model

Overview

Single-Foundation owned companies are typically commercial entities that are completely owned by with foundation. The foundation’s board members serve as the organization’s leaders. Some foundation have two boards: one which holds controlling rights of the copy and one which holds the rights to distribute dividends to charitable causes.

Countries: Foundation-owned companies can be found in many countries around the world; across the European Union, the United States, and Central and South America.

Examples of Single-Foundation Model Companies

dm Drogeriemarkt

dm is the largest drug-store chain in Europe, pioneering organic food trader and pioneer in sustainability. dm is directly owned by a charitable foundation and one early investor, who still holds some equity. The Foundation is controlled by current managers, former managers, lawyers, and a handful of successful business leaders, who are trusted by Götz Werner, the founder of dm. The foundation has two boards: 1. An operative board that’s in charge of executing dm voting-rights, which are held by the foundation. The board co-opts new members without outside interference. 2. A charitable board, which is in charge of distributing the profits that the foundation receives when the operative board decides that some proportion of profits does not need to be reinvested. The board also co-opts new members.

Wala Heilmittel GmbH

The Wala Heilmittel company produces natural care products, natural cosmetics products and is one of the biggest and oldest producers of natural and homeopathic medicine. 100% of shares, dividend rights and voting rights are owned by the Wala Stiftung, a non-charitable foundation that does not benefit any private person. It has the aim to further the mission of the Wala company. The board of the foundation coopts new members. According to the statues of the Foundation, primarily former managers and employees of the company should be selected. There are currently six Wala Foundation board members.

Advantages & Disadvantages

Advantages

Unlike other steward-ownership models, companies only need to set up one entity for a Single-Foundation model.

Disadvantages

Setup and operation of a Single-Foundation can be expensive depending the company’s size.

There is no legal owner in a Single-Foundation model. Everyone acts as an employee. This can be a disadvantage as individuals may not feel same motivation or responsibility to the company as “owners” in other steward-owner models. Foundation have a tendency to slow-moving, conservative, and not as entrepreneurial as other types of organizations.