By Meera Raman | The Globe and Mail
A British Columbia-based support services provider has become the largest company in Canada to transfer ownership to its employees through a new model designed to help owners sell their businesses without seeking outside buyers.
Taproot Community Support Services, based in Maple Ridge, B.C., announced to its workers Tuesday that it has been sold to its 750 employees through an employee ownership trust, or EOT, a structure only introduced in Canada last year.
The move makes Taproot the country’s largest EOT to date, according to Employee Ownership Canada, and highlights how the model could play a role in succession planning as thousands of small business owners prepare to retire.
“This employee ownership trust is the simplest way of transitioning ownership,” said Taproot’s chief executive Mike Fotheringham, who first learned about the concept while listening to a podcast on his commute last summer. “It provided current shareholders an opportunity to sell their shares, which was really important for a lot of them. Some of them had retired and weren’t with the business any longer.”
Taproot provides support services for adults with disabilities, as well as vulnerable youth and families across B.C., Alberta and Ontario. The company generated $54.3-million in revenue last year. Before the transition, it was owned by about 30 long-time and prior employees, some of whom are retired.
Finance Minister François-Philippe Champagne said in a phone interview that Taproot’s move is “something extraordinary.”
Visit Employee Ownership Canada to learn more about Employee Ownership Trusts.
Share with a friend
Related reading
Mapping the economic centre-left
The large and well-funded American blogsphere has a pretty wide array of economic voices and ideological camps within the centre-left tent. So big, in fact, that there’s a sub-genre of inter-blog conflict dedicated to people named Matt. Over the years, SCP Director of Policy Dan Skilleter has found it useful to categorize these various different centre-left ideological camps in his head. The categories are not mutually exclusive, and most people probably identify with a few at once. This explainer breaks down each camp's story about what’s wrong with the economy and how they’d prioritize dealing with it.
How intergenerational inequality threatens trust in democracy | Policy Options
Our political leaders must be willing to make difficult tradeoffs to rebalance policies toward the young and away from older Canadians, write Jean-François Daoust, Liam O'Toole and Jacob Robbins-Kanter in Policy Options. The broader economic picture for younger Canadians offers little hope, and economic frustration is shown to run hand-in-hand with political alienation. As intergenerational inequality persists and deepens, Canada risks experiencing an even sharper decline in trust in its democratic institutions than what already exists. Building affordable housing and supporting young families are essential first steps in a much-needed generational reset that puts fairness at the centre of Canadian political life.
Smith School of Business launches new Employee Ownership Research Initiative
Smith School of Business at Queen's University is launching Canada's first-ever research initiative focused on deepening Canada’s knowledge and understanding of a powerful succession model that can enhance outcomes for owners, employees and communities: employee ownership. With funding support from Jon Shell, Chair of Social Capital Partners and a board member at Employee Ownership Canada, the Employee Ownership Research Initiative (EORI) will be housed in Smith’s Centre for Entrepreneurship Innovation & Social Impact (CEISI). The initiative will shape a made-in-Canada approach to employee ownership and create a multi-disciplinary network of academics, researchers, practitioners and businesses to fill gaps in relevant data, expertise and business-oriented resources to support employee-ownership activities across the country.