Billionaire CEO hands over a huge pot of money to his employees simply because he thinks it’s the right thing to do. Man bites dog, right? Yet that is what Hamdi Ulukaya, founder and CEO of the Greek yogurt-giant Chobani, just did. Mr. Ulukaya appears to have been following the path of some of his more enlightened peers in the food industry.
Ulukaya recently announced his plan to give a 10 percent ownership share to his 2,000 full-time employees with shares distributed based on tenure at the company. He will retain majority control of Chobani, but with the firm valued at several billion dollars the transfer represents hundreds of millions of dollars from him to his employees.
In an interview with The New York Times, Ulukaya said, “Now they’ll be working to build the company even more and building their future at the same time.”
The Times story quotes Jessica Kennedy, a human resources consultant, who said, “It’s very uncommon and rare, especially in this industry, for these kinds of programs to be rolled out.”
Kennedy might be right that it’s far too few and far between for CEOs to share ownership, and the wealth and power that comes with it, with their employees. But notable exceptions exist. Among them, these five stand out:
- WinCo Foods is a grocery store chain with over 100 stores and 15,000 employees valued at over $3 billion. It’s also owned by its employees, many of whom are millionaires despite having only a high school education and working in a low-skill job like cashier.
- King Arthur Flour Company in Norwich Vermont, the country’s oldest flour company, began to transfer full 100 percent ownership to its employees in 1996. It has been named best place to work in Vermont for the past ten years and has seen remarkable growth.
- Equal Exchange in West Bridgewater, Massachusetts is the oldest and largest Fair Trade coffee company in the country. Founded as an employee-owned cooperative in 1986, the company distributes decision making, and profit, to its 100 worker-owners.
- Clif Bar, an organic food and drink company targeting athletes, initiated in 2010 an ESOP — an employee stock ownership program — that gives its workers a 20 percent share in the company. The company posted $340 million in sales the next year.
- Bob’s Red Mill Natural Foods founder and CEO Bob Moore transferred full ownership of his company to his 209 employees after nearly 40 years in business. Moore reportedly turned down countless buy-out offers, but “couldn’t envision selling the business to a stranger.”
Other food industry CEOs should take note of the success of these employee-owned companies both in their positive public image as well as their bottom line. Hopefully Chobani, along with these five firms, will be just the beginning of a new wave of food firms to embrace employee ownership.
Josh Hoxie is director of the Project on Opportunity and Taxation at the Institute for Policy Studies and co-editor of Inequality.org.