Formation Architects launch as an Employee Owned Trust
Formation Architects have officially launched as an Employee Owned Trust, following an event on Thursday 26 May.
The London-based practice’s sale to Formation Trustee Limited means that the shares of the company are no longer owned by any individual or group, but are held in trust by an independent body on behalf of all employees of the business. The employees of Formation Architects have now become ‘beneficiaries’ of the Trust and therefore the activities of the company.
Formation Architects’ move to become an Employee Owned Trust recognises the benefits of the business model for attracting and awarding talent in London’s competitive architectural market and addresses the problem of succession that many practices face.
The move follows the sale of 100% of the business from sole shareholder and former managing director Gordon Thomson.
Employee Owned Trusts now deliver 4% of UK GDP annually, receive tax benefits through the government’s 2014-launched incentivising scheme, and have been found to demonstrate high productivity and innovation across sectors.
Speaking at the launch, President of RIBA Jane Duncan said:
‘Formation Architects is an exemplary practice. This move to become an Employee Owned Trust is all about the practice’s staff, future and succession plan. What they have here with this new model will create pride in the business, with all employed contributing to profit and valued for their work.’
Tim Quick, one of the directors of Formation Architects said:
‘There’s a real sense of renewal here at Formation Architects – a new era for the company. Our move to become an Employee Ownership Trust is not only a reflection of our collaborative ethos but it also simplifies the issue of succession for the future.’
Graeme Nuttall OBE, partner at Fieldfisher who supported the sale of Formation Architects to Formation Trustee Limited, and government advisor on Employee Owned Trusts, added:
‘The reasons for businesses to move to an employee-owned model are clear: improved business outcomes and greater employee engagement. What the trust model particularly helps maintain is a company’s independence and its ethos. Formation Architects has moved from the traditional model of a single individual owning and running a practice to one where the practice is held by a trustee on behalf of and run in the interests of all employees. This model is set to become the main way architects’ practices are owned in the UK.’