In a groundbreaking move, Ireland has announced its very first employee ownership transition using the employee ownership trust model, potentially paving the way for a vibrant new era of Irish employee ownership.
Irish digital marketing agency Wolfgang Digital Limited (Wolfgang) has announced its transition to employee ownership using an Employee Ownership Trust (EOT).
The move has been influenced and supported by Graeme Nuttall OBE, international ambassador for the Employee Ownership Association (EOA), whose work with the Irish Proshare Association (IPSA) to identify tax obstacles to the EOT in Ireland.
Wolfgang founder Alan Coleman now aims to seek the support of the Irish government to remove tax obstacles and make employee ownership a viable business model in the Emerald Isle.
“Wolfgang’s plan is to become a leading light for EOTs this side of the Irish sea and to pave the way for more people to own where they work here in Ireland,” Alan said.
James de le Vingne, Chief Executive of the EOA, said: “Being the first to step into uncharted territory requires courage, vision, and belief. Wolfgang’s embrace of employee ownership is helping extend the proven impact of the EOT model.
“With the support of the eoa and others, we’ll ensure they flourish, creating a path for others to follow.”
Wolfgang Digital founder Alan Coleman
EOTs in Ireland
A company converting to EOT ownership is an everyday occurrence in the UK, but it’s unheard of in Ireland, where there is neither a history of employee ownership nor experience of using employee trusts in private companies. Despite this, Alan is determined to positioned employee ownership in Ireland’s political, economic, and business mainstream.
Wolfgang’s transition is part of an ongoing campaign to get Irish politicians to support EOTs and remove tax law obstacles. The trustee of Wolfgang’s EOT has bought 25% of the company’s shares with an ambitious plan to move to 100% employee ownership within the next few years.
As well as establishing an Employee Council, the company’s EOT Trustee Board boasts Graeme Nuttall as its independent chair.
As well as his recent appointment as EOA International Ambassador, Graeme is the former independent advisor to the British government responsible for making the EOT model popular in the UK.
A Decade in the Making
Graeme has a long history working to establish employee ownership in Ireland. He delivered the Irish equivalent of the UK’s Robert Oakeshott Lecture – the Jack Fitzpatrick Memorial Lecture – in 2013 and spoke on EOTs at the Irish ProShare Association Employee Share Ownership Day 2023 conference.
His work with IPSA identified tax obstacles to using EOTs in Ireland. IPSA then introduced Graeme to Alan to help him design the nation’s first EOT.
Employee Ownership Association Ambassador Graeme Nuttall
Preparing for Ireland’s First EOT
As part of its preparations to transition to employee ownership, Wolfgang attended last year’s EOA annual conference.
EOA member Baxendale provided trustee training, while legal advice came from the Dublin office of Fieldfisher, support from Fieldfisher’s London EO Solutions team, and confirmation of the tax obstacles from Arthur Cox.
Revealing more about his decision to go the employee ownership route, Alan said: “For most entrepreneurs the big sale to the big company is the picture of success. To me that looks like death. The death of the dream.
“The idea of enshrining our dreams, or stakeholder promises and our values forevermore by way of employee ownership is a far more exciting succession strategy for me.
“In paving this new path, it is of great benefit to Wolfgang to be able to learn from the tried and tested EOT sector next door in the UK and it’s of great benefit to have the expertise and experience of Graeme Nuttall on our team, both as author of our trust model and as chairperson of our trust. “
The Future of EO in Ireland
Wolfgang has made history for employee ownership in Ireland, but the work is far from over.
“Wolfgang Digital’s pioneering move to employee ownership shows how EOTs could be a great success in Ireland, to grow businesses and provide a really attractive succession solution that benefits selling shareholders, a business, its employees and the Irish economy,” says Graeme.
“But the Irish Government needs to remove major pitfalls by publishing guidance on the tax rules on financing EOTs and making legislative changes to remove tax obstacles that don’t exist in the UK.
“For instance, employee trusts in the UK have long been exempt from inheritance tax and Ireland needs an equivalent exemption from its discretionary trust tax charge.”
