Entrepreneurs

From Good Intentions To Meaningful Actions: Employee-Ownership Holds Company Accountable To DEI Improvements

In the wake of the racial justice protests in the summer of 2020, many companies reflected on their own diversity, equity, and inclusion practices, examining whether they were aligning their values with their actions. The outpouring of corporate statements condemning racism were fast and strong, yet it has left many wondering what lasting action and change has been taking place since the statements were released. For several purpose-driven businesses, the introspection revealed areas to improve upon and did, indeed, catalyze meaningful action. Butler/Till, a Certified B Corporation marketing agency that focuses on the healthcare, financial services, insurance, and energy sectors, was among the businesses that is looking to update its policies and practices to better support its DEI initiatives. The company credits its employee-ownership for helping drive its response.

“That’s one thing about employee-ownership — a lot of this bubbles up from within,” says Kimberly Jones, President & CEO of Butler/Till. “I think employee-owners feel very comfortable voicing their opinions and holding their leadership accountable.”

I spoke to Jones as part of my research of B Corps, companies that have a third-party verified positive social and environmental impact. In our conversation, Jones discussed the company’s employee-ownership and B Corp journey, the recent improvements to its DEI practices, and how its ownership structure held it accountable.

Christopher Marquis: Can you talk about the Butler/Till journey to employee-ownership and B Corp certification?

Kimberly Jones: Employee-ownership came first. So it was really the vision of our founders to leave the company intact. It was not to sell to a strategic buyer. They wanted not only for their legacy to continue, but to also provide some financial reward to the employees who helped them build their own financial success. And so we did our ESOP transition in two different transactions. The first was in 2011 when our founder sold 51% of the company back to the employees through the formation of an ESOP Trust. The next handful of years were so successful financially that we ended up paying off our loan sooner than we expected, which enabled the founders to fast-track their succession plans. The second transaction, which was in 2014, transitioned Butler/Till to a 100% employee-owned company. 

The following year, we opportunistically acquired a company that was then called Brand Cool Marketing. It’s a marketing consultancy also here in Rochester, New York. We found that our values were well aligned, and we had some experience working in partnership with them over the years, so we were able to execute a quick transaction. With that acquisition came our foray into B Corp certification, as Brand Cool was a B Corp. The firm had built a reputation primarily within the energy and sustainability space. 

So they introduced us to the B Corp concept, and I took the opportunity to go to one of the B Lab conferences. It was out in Portland and I really got to learn about what being a B Corp is all about. Since then, we have proudly upheld these environmental, social, and corporate governance practices, honoring the founders’ legacy. We’ve continued to renew our certification as a B Corp ever since.

I think there is a common misconception that being a B Corp is purely environmentally driven, but that is not the case. There are a lot of different things that affect your B Impact Assessment score. You are actually scored among many different metrics that include your environmental approach, but also again policies, like community service, your employment practices, and certainly diversity in hiring. We have made changes to employee policies and vendor policies.

Marquis: Tell me a little bit more about how you’ve worked on improving your diversity, equity, and inclusion.

Jones: Butler/Till is a certified women-owned business enterprise (WBE), nationally certified both by Women’s Business Enterprise National Council (WBENC), the largest third-party certifier of businesses owned, controlled, and operated by women and the NY Empire State Development. We are also 100% employee-owned through our ESOP Trust. As a certified B Corp, women-owned, and employee-owned organization, we somewhat took for granted that we had policies and supported initiatives that encouraged inclusion. But like many companies, it took holding up a mirror last summer in the middle of all of the social unrest to say, “Yes, we say we believe in these things, but if you look at our population, we do not actually reflect it.” And so we did have to take a hard look at ourselves and question whether we were really doing enough. Although we were doing a lot of good towards these efforts, we did not have a formal DEI plan.

We approached this as we do with a new client, the first thing we did was try to learn more through a discovery phase. So we took a bit of a timeout and said, “Before we do anything, before we put pen to paper on what our DEI approach is going to be, we need to learn from some experts.” We took a couple of months for that discovery phase, and invited Dr. Aaron X. Smith, a professor from Temple University in Africology Studies, to come help us understand the history of racism. We made that available to all of our employee-owners. We offered a curated list of LinkedIn Learning courses, including a mandatory class on confronting bias in the workplace. Then we held a lot of focus groups, because we needed to take a pulse on where our employee-owners were when it came to this topic of racial equity. As an employee-owned company, without knowing where everybody was on their own personal journeys, we were not sure where to start. That approach has been really effective. 

We ultimately landed on actually writing down a goal, to “attract, develop, engage and retain a high-performing workforce that reflects the communities that we serve.”

It became evident to us in our research and focus groups that the “I” in DEI is the anchor for us. Diversity is about the presence of our differences inclusive of race, gender, religion, sexual orientation etc. And equity is about fairness in policies and procedures. Both are extremely important. But it was obvious that if employees do not have a sense of belonging and feeling included, welcomed, and safe then any other initiatives will not be successful.

Diversity initiatives that lack an authentic and genuinely inclusive environment lean towards situations of tokenism where it is just about meeting numbers to prevent criticism and give the appearance that people are being treated fairly. But our focus is on authenticity, we felt it was crucial that we pay very close attention to anchoring in the inclusion first.

We also changed our paid time-off policy. Regarding our PTO and holiday policy, we have three floating holidays so people can honor the holidays that are most important to them.

Through our annual employee engagement survey, there is also a section dedicated to DEI, which we ask our employee-owners whether or not we are a workplace where they feel that diverse views and opinions are heard and can be used as a strength. We are using these results to contribute to how we are monitoring our progress over time.

Marquis: How did Butler/Till’s employee-ownership structure influence the DEI changes the company made?

Jones: I hate that it comes down to such horrific events happening, including violent protests, for people to take a pause and really reflect, but that’s what it was for us. And our employee-owners immediately voiced their thoughts, concerns, fears and opinions about what our community was experiencing. They were doing exactly what we wanted them to do. They held us accountable. Their voices and vulnerability influenced us greatly around our DEI initiatives.

 

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