- Passionate, purpose-driven entrepreneurs: It can be argued that founders/ entrepreneurs in a steward-owned company are more purpose-driven and more connected to the business in itself than in many other companies. They are intrinsically motivated and have a high intentionality and passion for the purpose of the company. So it is less likely that they abandon ship and, as investor Patrick Knodel put it, they are less likely to let go and master even difficult situations. This can of course also apply to entrepreneurs in other companies!
- Vision holders with understanding of what’s going on in the driving seat: In steward-ownership, the entrepreneurs are vision holders and understand what’s going on in the company; they are in the driving seat instead of whoever is the highest bidder. This can lead to a closer connection between steward and company and lead to more efficient and purpose-oriented steering of the company.
- Steward-ownership can lead to a reduced team risk: Transitioning to steward-ownership means having to talk consciously about power, money, ownership, governance, visions for the future, etc. Teams that have jointly transitioned to steward-ownership have had these conversations – which in other companies often lead to conflicts between the founders/entrepreneurs, sometimes even resulting in complete abandonment of the joint project. Data also shows that steward-owned companies have a higher retention rate of employees and management, ensuring more stability and consistency in the company.
- Steward-ownership can be a competitive advantage for companies: In some cases, steward-ownership leads to a competitive advantage for companies, e.g. in cases where customers and other stakeholders value the commitment of the company to steward-ownership. Steward-owned companies are shown to act with greater long-term orientation and have a higher survival rate (6x higher than comparable companies after 40 years).
Sources: Børsting, C. and Thomsen, S. (2017): “Foundation Ownership, Reputation and Labour”, in Oxford Review of Economic Policy, 33 (2), 2017, p. 317–338 Hansmann, H. (1980): “The Role of Nonprofit Enterprise.”, in The Yale Law Journal, 89(5), 835–901.; Kuhn, J. and Thomsen, S. (2014): “The Demography of Danish Foundation-owned Companies.” (working paper), in The Research Project on Industrial Foundations. Available at http://www.tifp.dk/; Thomsen, S., Poulsen, T., Børsting, C., Kuhn, J. (2018): “Industrial Foundations as Long-Term Owners.”, in Corporate Governance. An international review, 26 (3).