Company Founder to Give Part-Ownership to Employees

The founder of Richer Sounds, a UK audio and entertainment retailer, gave his employees majority ownership of the company. Julian Richer, who established Richer Sounds in 1978, decided to stop running the daily operations of his company. As he stepped down, the company paid him a total of £9.2 million for his stake, 60% of which he transferred to an employee ownership trust. The trust, called the Richer Sounds Trust, gives the company’s over 500 employees control of the business and makes them part-owners. Richer explained that he had always planned on leaving the company to his employees. After turning 60 in March, he felt that it was the right time to do so while he is still around. He wants to oversee the transition and make sure that the company’s customers and partners will not be negatively affected by the new arrangement. Aside from transferring ownership, Richer is also giving £3.5 million to his employees as a way of thanking them. Each employee will receive £1,000 for each year of service he or she had worked at the company. This means that those who have served for over 20 years will get large bonuses. The chairman of Richer Sounds, David Robinson, praised Richer’s decision. He said that with this action, the employees will be more attached to the company and have more interest in its success. Despite handing over control of the business, Richer will still play a role in it. However, the day-to-day operations of the company will be managed by the management board and the new trustees and advisory council, which are composed of employees.