Building Black Wealth Through Employee Ownership
Still promising; keep an eye on Atlanta
When I first began thinking about employee ownership in 2022, I was working from Provident1898, a coworking community at the bottom of the NC Mutual Building Durham, the cornerstone of what was the “Black Wall Street” of North Carolina.
At the time, there were already folks exploring how employee ownership might be adapted to the needs and capacities of Black business owners.
Apis & Heritage had just raised its first fund
The Rutgers Institute had released its online courses on employee ownership targeted at Black owners, with support from the Kellogg Foundation
Project Equity, supported by Ashoka, had made racial justice central to their employee ownership mission
More recently, it was a focus of last year’s Congressional Black Caucus Foundation gathering, and Project Equity launched its Black employee ownership initiative with two reports in conjunction with Morehouse College in Atlanta.
The Atlanta connection caught my eye, having lived there for two years myself in the early stages of my impact investing career. As I learned, you can’t sleep on Atlanta.
Atlanta is home to the Georgia Center for Employee Ownership, led by Tom Strong, a longtime advocate of workforce development, a rich field of resources that employee ownership advocates are just beginning to plow (check out GACEO + Project Equity’s data on looming business closures in Georgia)
In November , the Atlanta Wealth Building Initiative released its latest report, Building A Beloved Economy: A Baseline and Framework for Building Black Wealth in Atlanta. Here’s what they had to say about employee ownership:
Workers at employee-owned companies gain access to employee stock ownership plans (ESOPs) that enable families to significantly increase their assets, shrinking—though not eliminating—racial wealth disparities, suggesting employee ownership can build Black wealth. The city should invest in technical assistance to educate existing businesses on the benefits of employee ownership as well as assist with capital and other tools to help them make the transition. Businesses where Black employees account for more than half of the payroll should be prioritized.
Hard agree! And: I suspect perpetual purpose trusts and employee ownership trusts might be particularly useful in a state with the second-highest concentration of Black-owned businesses, two-thirds of which have fewer than ten employees (see graphic). ESOPs generally don’t make sense for companies that small. Worker cooperatives involve a concurrent transition to more democratic decision-making that small business owners aren’t always ready for.
This is all still promise—there are to my knowledge no Black-owned employee ownership trusts, though 94% of the employees at recently converted EOT Ocaquatics are people of color.
But if there is a town where this promise could be realized, it’s the capital of Georgia. Keep an eye on Atlanta!