Judy Doidge
Team
M@st3rSCP
Name Here
Judy works with our private, public and non-profit partners within workforce development. With experience in all three sectors, she is able to bridge gaps in communication, incentives and objectives of all stakeholders. Having managed national recruitment and retention programs for employers across Canada, Judy has extensive knowledge in employer engagement skills training, and diversity and inclusion. She led SCP’s partnerships with the Ontario, Manitoba and Nova Scotia governments on demand-led employment and training systems, and worked with the Ontario Centre for Workforce Innovation and Metcalf Foundation’s Toronto Sector Skills Academy. Currently she is supporting the work of partners on workforce development projects across various sectors and population groups. Judy holds a BA in Sociology from the University of Western Ontario.
Jon Shell
Team
M@st3rSCP
Name Here
Jon was Managing Director of SCP from 2017-2023, leading the transition to our Ownership Agenda. He spent most of his career in the private sector before joining SCP, founding and growing successful companies in both Canada and Australia. Jon co-founded both Save Small Business and the Canadian Employee Ownership Coalition. Jon was first introduced to SCP when Bill supported a volunteer entrepreneurship project he was leading in Kenya in 2008. He received a BA from Queen’s University and an MBA from the Richard Ivey School of Business at Western University.
CAMP x SCP virtual talk - understanding private equity
In industries from dentistry to aircraft manufacturing, private equity (PE) is everywhere—some of it intent on rejuvenating flailing businesses, and some of it poised to extract maximum profit at any cost. To demystify this financial tool, CAMP and SCP hosted an expert panel of informed insiders and prominent American critics who have been on the frontlines of fighting PE’s worst excesses. Together, moderator Ana Pereira from the Toronto Star, Private Equity Stakeholder Project’s Jim Baker, Plunder author Brendan Ballou, SCP’s Jon Shell and CAMP Fellow Rachel Wasserman break down how PE is commonly used, what’s next and how we can change course.
Panelists
Moderator
Ana Pereira
Business Reporter, Toronto Star
Overheard at Crowe Soberman: The EOT advantage
Crowe Soberman Audit and Advisory Partner Chandor Gauthier sits down with Jon Shell, Chair of Social Capital Partners and Board Member at Employee Ownership Canada. They dive into the benefits of Employee Ownership Trusts and get into the nitty gritty of how EOTs can support smooth business succession, boost equity and retention and safeguard business legacies.
Speakers
Optimizing the impact of Canada’s Small Business Financing Program
Canada is currently undergoing the biggest wave of business succession in the country’s history. At the same time, Canada is facing a sharp decline in business formation and entrepreneurship. Without intervention, these twin trends are poised to weaken the vibrancy of Canada’s economy and damage local economies for the indefinite future.
Social Capital Partners and Venture for Canada made a joint submission to Innovation, Science, and Economic Development Canada (ISED) as part of its work to finalize its mandated 5-year review of the Canadian Small Business Financing Program (CSBFP).
We recommend that the CSBFP should be amended to allow for increased Entrepreneurship through Acquisition (ETA). ETA is a model whereby existing or aspiring entrepreneurs purchase and grow existing small businesses, rather than build them from scratch. This approach plays an important role in facilitating a transition to a new generation of entrepreneurs, keeping wealth in Canadian communities and unleashing local, private sector innovation.
Matthew Mendelsohn
Team
M@st3rSCP
Name Here
Matthew is a Canadian public policy leader. For over 25 years, he has designed and implemented public policy solutions that work in practice and has advised governments, organizations and elected leaders on ways to improve economic, social and democratic outcomes. Matthew is a former deputy minister with the governments of Canada and Ontario, and was the founding Director of the Mowat Centre, a public policy think tank at the University of Toronto. Most recently he was a Visiting Professor at Toronto Metropolitan University and a Senior Advisor at Boston Consulting Group. Matthew received a B.A. from McGill University, a Ph.D. from the l’Université de Montréal and an ICD.D from the Rotman School of Management.
Toronto Sun: Employee ownership trusts explainer
Toronto Sun
SCP Chair Jon Shell in the Toronto Sun on what Employee Ownership Trusts mean for business owners, the community and the broader economy.
Uncommons Podcast: Wealth inequality and inclusive growth with Matthew Mendelsohn
Social Capital Partners’ CEO, Matthew Mendelsohn, joins Member of Parliament for Beaches-East York, Nate Erksin-Smith, on his podcase “Uncommons”. Matthew and Nate talk about wealth concentration and its threat to democratic stability. They also discuss practical solutions to address wealth inequality, lack of trust in democratic institutions, the role of the federal public service and the need for a competent and responsive government.
Speakers
Nate Erksine-Smith
Member of Parliament, Beaches-East York
Mark Carney and the Canadian business elite need to think more about growing wealth inequality that is destabilizing democracies around the world
By Matthew Mendelsohn | The Toronto Star
Mark Carney had a chance to weigh in one of the defining issues facing Canada. The answer he gave suggests he isn’t ready for public life
Mark Carney made a speech last week and many people had plenty to say about it. But one of his replies during the Q & A deserves more attention than it received.
MP Nate Erskine-Smith asked Carney what he would do about Canada’s growing wealth inequality. Carney’s answer was a bit unfocused, but he made two points clearly: 1) Let’s hope wealthy people give more to charity, and 2) We shouldn’t only focus on redistribution.
This was not a serious answer.
If Carney wants to play a constructive role in Canadian public life, he should have thought deeply about the staggering and growing wealth concentration in Canada and around the world. This concentration is creating anxiety and anger among many young people, it is destabilizing democratic societies and he should have something meaningful to say about it.
Given his professional history, Carney knows that the benefits from economic growth in recent decades have increasingly gone to capital rather than workers. Even if he doesn’t want to serve up big pieces of blame pie, he should at least have critical reflections on the role of finance in producing obscene wealth alongside real hardship.
Unfortunately, Carney’s instincts on wealth inequality are reflective of what has been on full display from many business leaders over the past few weeks who have been bemoaning Canada’s “productivity emergency” — and then having a bit of a fit about small changes in the capital gains tax.
We share these concerns about the long-term decline in productivity, which has real and negative consequences on our quality of life.
But Canada’s long-standing productivity challenges have been debated for three decades, their causes are not well-understood and the solutions are not obvious. We certainly shouldn’t assume that realistic solution just happen to coincidentally lineup with all the prior positions and economic interests of corporate Canada.
“Given his professional history, (Mark) Carney knows that the benefits from economic growth in recent decades have increasingly gone to capital rather than workers,” writes Matthew Mendelsohn. “Even if he doesn’t want to serve up big pieces of blame pie, he should at least have critical reflections on the role of finance in producing obscene wealth alongside real hardship.”
We are even more concerned that many of Canada’s industry leaders who shape our public debate have seemingly missed the most important economic policy debates of the past 20 years. Around the world, almost no serious person continues to believe that cutting taxes on the wealthy will unlock growth for working and middle-income people.
Most advanced industrial democracies are dealing with inequality and challenges to economic growth by rejecting market fundamentalism and investing in things like public transit, child care, affordable housing and ensuring that low- and middle-income people have money to spend in the local economy.
So, Carney’s answer was disappointing.
When he was asked about wealth inequality, Carney could have talked about his views on this emerging consensus. He could have talked about housing and its relationship to both inequality and productivity.
He could have shared his thoughts about global processes to confront wealth sheltering and corporate profit shifting.
He could have talked about how oligopolistic markets hurt working people, innovation and productivity and how we should break them up.
He could have discussed ways to get more capital into underserved communities or how we should confront the worst features of modern extractive capitalism and private equity.
And when he chose to toss the word “redistribution” on the table, he could have at least noted that we are living through a period when concentration of ownership is redistributing upwards toward the extremely wealthy. Or that it is important that we stop talking narrowly about income redistribution and focus more deeply on how to broaden ownership of the economy.
But his instinct was to say none of these things, just as the instinct of our business community when talking of productivity is to discuss their taxes rather than the housing crisis.
Authoritarian populists are winning in many places because, in part, the benefits of economic growth have been accruing disproportionately to capital. Everyone who aspires to play a constructive role in public life needs to address this head on.
Highly unequal societies — with wealth, opportunity and privilege passed along intergenerationally — are not safe, healthy or happy societies. They are not in anyone’s interest, even the wealthy.
Employee ownership trusts: What they mean for Canadian business owners
By Jon Shell
Employee Ownership Trusts (EOTs) are coming to Canada! This note is intended to give business owners and their advisors a simple (albeit not short) explanation about what they are, and why they should care. I’m not a lawyer or an accountant, so I’ll try to use language that I understand (and that may in some cases not be technically perfect). So, don’t take this as legal advice, but as someone trying to explain this in a way I think I would understand.
A quick point up-front: EOTs are intended for succession — a way to sell a majority of a business to a company’s employees. They don’t help with selling a minority stake in the company — there are other approaches for that, like stock option plans and share purchase programs. So, unless you’re looking to sell your business, the EOT likely isn’t for you.
However, if you are considering selling your business in the next few years, you should be aware of the EOT. Employee ownership has a long track record of being good for employees, companies and communities, and as a result the UK and US provide significant tax incentives for business owners who sell to the workers. Canada is now following suit, exempting the first $10M of capital gains from income tax for sales to EOTs. This exemption is only available until the end of 2026, so there’s good reason to look seriously at the option.
“Employee ownership has a long track record of being good for employees, companies and communities, and as a result, the U.K. and U.S. provide significant tax incentives for business owners who sell to their workers.”
EOT-like structures are quite popular in other countries, and tax incentives are only part of the story. I’ll get into more detail about the legacy and resiliency benefits later, but here are a few stories featuring owners who have sold to their employees through this structure in the US and UK: Taylor Guitars (US), Emsworth Yacht Harbour (UK) and Craggs Energy (UK). In the US about 250 companies a year are sold to their version of the EOT, and in the UK over 300 companies have sold to their version in each of the last two years.
If you’re looking for more technical detail, I’ve added links at the end, including to the government’s own EOT explainer. If you scroll down and say to yourself “man, this is too long” feel free to skip to the end and click on one of those other links instead.
If you’re still with me, you likely have dozens of questions, so I’ll try to anticipate some of them in a Q&A format here.