These ownership forms have empirically been shown to beat conventionally owned companies in terms of productivity and innovation, they can close a large part of the problematic European business succession gap, they prevent productive assets from being extracted from the EU, and they distribute the EU's future growth across the population without taxes or government expenditure. Finally, these ownership forms give entrepreneurs the freedom to control their legacy.
1. The succession gap
Around 450,000 EU business owners reach retirement age each year, and this number will peak in the coming decade due to the demography of the baby boomer generation. Approximately one in three subsequent business transfers fail due the lack of a locally embedded successor. This causes regions, member states and the EU to lose productive assets every day. Without genuine alternatives, these businesses are channelled into a narrow set of exits dominated by financial acquirers, of which US private equity is the best-resourced and most competitive bidder. Ultimately, this will cause an ownership transfer from locally minded business owners to extractive financial owners, leading to an asset leak away from European ownership.
2. Competitiveness and innovation
Steward and employee owned firms have been proven qualitatively and quantitatively to compete with conventionally owned companies in both industrial and service sectors. Removed from shareholder pressure, steward-owned businesses have produced groundbreaking innovations such as Novo Nordisk's semaglutide (aka Ozempic), Bosch' anti-lock braking system (aka ABS, used in every car produced), and Carl Zeiss' EUV lithography (essential for manufacturing the world's most advance semiconductors). Scientific research furthermore shows higher levels of reinvestments, productivity and profitability for these ownership forms compared to conventional ownership.
3. Member states cannot solve this individually
The buyers operate across borders, the capital pools sit largely outside the EU, and national company-law fixes do not travel. This means a solution in one member state enhances the problem in others. A 28th regime is the only level at which a coherent, opt-in European alternative can be built.
4. Steward ownership and ESOPs already work at scale
Europe's steward-owned firms include Novo Nordisk, Maersk, Carl Zeiss and Rolex. Available evidence suggests these firms survive markedly longer than conventionally owned peers, reinvest more aggressively, have higher productivity and produce landmark innovations. ESOPs - or EOTs as they are known in some countries - have decades of track record in the US and UK; the John Lewis Partnership (owner of Waitrose) and the travel agent Attraction Tickets are well-known English examples. IteraTec in Germany, and Inea is Slovenia are two European examples. Studies consistently report higher productivity, stronger employee retention and lower volatility through downturns.
5. Entrepreneurs have a right to choose their legacy
Including these forms in the 28th regime does not close any exit that is currently open to European entrepreneurs; it only opens one that is presently very hard to access, but which should be available to owners. This also goes for hybrid ownership, when owners want to maintain capital attraction possibilities through public listing, without giving up control rights of the steward foundation (a structure used by Novo Nordisk). Those who would prefer not to sell to a financial buyer would gain a credible alternative, and the EU economy would retain productive firms, talent and tax revenue that would otherwise leave.
