Riverford owner Guy Singh-Watson places his veg box company into employee ownership
PUBLISHED: 10:58 05 June 2018
This month marks a milestone for Riverford Organic Farmers, the multi-million pound organic veg box company, as its owner hands over ownership to its staff | Words: Catherine Courtenay Pictures: Matt Austin
Riverford founder and owner Guy Singh-Watson has faith in human nature. He gets angry at the assumed belief that cash is all people care about. He finds this attitude “frustrating and demeaning”, he says.
It’s one of the reasons why, on 8 June the 58-year-old entrepreneur farmer behind the largest organic veg box scheme in the country will place his company in employee ownership.
Like the John Lewis Partnership model, shares will be held in trust for the equal benefit of staff. Initially, Guy will retain 26% of the company, handing over 74% to the 650 staff who will share 10% of annual profits. In return he will receive £6million over the next four years – half or less of Riverford’s market value.
The decision has taken years to formulate, going back to thoughts he had while working on the farm.
Being on the land, with his hands in the soil “is when I think of all the things wrong with the world and start designing my utopia,” he says.
“Around 2005-7, I was thinking, what sort of a world do I want to live in? I was very affronted by Thatcherite Britain and the assumption that it was all about money.
“I’m no keener on communism than unrestrained capitalism,” he adds, “but I spend a lot of my time thinking of how things can be better.”
He began investigating co-operative or employee ownership business models. Deciding on the latter route (he’s wary of anything “too utopian”, he says) by 2007 he’d got very close to implementation, but then: “The recession hit, organic sales dropped by 25% and we had a crisis with our IT systems at the same time.”
“We were very, very close to the edge,” he says, reflecting on that time; but things improved and, a couple of years ago, the idea was back on track.
One model of employee ownership is for workers to buy shares, rather than have them held in trust. Both routes held appeal for Guy. “Most people want to be in control of their lives,” he says, feeling the trust model was “a bit paternalistic”, even though it was fairer.
The decision was put to the staff who voted for the trust. “I was really inspired by the quality of the discussion. They decided unanimously and it was rather wonderful.”
It also confirmed his belief, now part of the company’s ethos statement, that: “Most people are better, kinder and less greedy and have more to give than our institutions allow them to demonstrate.”
With none of his children wanting to take on the Riverford mantle, his biggest fear had been that it would fall into the hands of external shareholders. It’s crucial for him that Riverford retains its values. The fact that so many companies in the UK and USA are bought and sold on a five-year cycle appals him.
He cites examples of ethical, pioneering businesses which have been sold to corporates or venture capitalist investors, the results he believes, almost always being a drop in values and quality.
“Greed, exhaustion, an easier life…” he ponders the reasons why they sell out. “The system is bloody crazy; people spend a fortune on marketing, setting up a business just to sell it. It’s short-termism growth culture.”
He’s not anti-growth, around 7/8% is necessary he says. “With this we can do new things and generate new opportunities for staff; but venture capitalists would want 30-40% growth.”
He may veer away from paternalism, but Guy’s passion for Riverford means he’s not letting go completely: “I want to be around for the transitional period to oversee the change of culture.”
Freely admitting he’s “a maverick and can be a bit of a bully”, in the past there have been times when he’s thrown his toys out the pram, insisting on the way he wants to do things. It’s no surprise that he’ll still keep a lot of vetoes – but it also appears that he’s mellowing.
Listening is the key, he states. And it’s an aspiration for the future. “My parting gesture will be a Big Ear award for the manager whose listening has improved the most. If managers listen everything else will follow.”
So what does the future hold for one of Devon’s most charismatic figures?
He’s not interested in politics, he says, and not being a fan of meetings, he’s looking forward to spending more time on the land. He’s bought a nearby farm and will experiment with innovative agricultural techniques. “Proper ways with less cultivation of the ground,” he says.
He’ll be developing his plan to create compost from crab shell waste and will be involved in some mentoring for local businesses as well as further afield – namely a box scheme in Brazil.
“But I’ll occasionally go out and sit on a tractor and grow cardoons and artichokes - it’s what I like doing.”
A GROWING STORY
Riverford Organic Farmers has five farms in Devon, Cambridgeshire, Hampshire, North Yorkshire and France; a restaurant, the Riverford Field Kitchen at its Buckfastleigh HQ and the UK’s first organic gastropub, The Duke of Cambridge, in London.
It was started by Guy in 1987 with him delivering veg to a handful of friends from his first organic field. In 2014 he married his second wife, environmental campaigner Geetie Singh MBE, founder of The Duke of Cambridge.
The company has a turnover of nearly £60 million and delivers boxes straight from the farm to 50,000 homes a week. Guy has twice been named BBC Radio 4’s Farmer of the Year; in 2015 The Observer named Riverford’s veg boxes as Ethical Product of the Decade and he was also named Devon Life Food & Drink Awards Devon Food Hero in 2012.
Under the new structure five trustees will oversee a board of directors and staff will have input through an employee council. Two staff members will become trustees along with Guy and two external appointments – Ken Temple and Nick Buckland. Since 2010 employee ownership of companies has grown by about 60%.