First, thank you for inviting me to come to Slovenia and participate in this important gathering. I especially want to thank Tej Gonza and David Ellerman for their involvement and leadership not only here in Slovenia but also on an international level. Your thought leadership and persistence is admirable and valued.

For the last six years I've had the privilege of leading both the ESOP Association and its affiliated Employee Ownership Foundation in the United States. 

By any measure, we stand as the largest organizations in the world representing and advancing employee ownership. 

Collectively, we represent more than 14 million Americans who hold an ownership stake in an ESOP and the $2.3 Trillion dollars in wealth they hold in their accounts. 

That also represents 1 in 10 private sector jobs in the US economy, and annually, ESOPs pay more than $175 Billion - that is billion - in plan distributions to employee owners. 

Put another way, American ESOPs currently pay distributions of more than twice the total annual GDP of Slovenia.

I make these observations intentionally to grab your attention - this is not a passing fad. This is not a theoretical exercise. 

This is a substantial, meaningful, and highly successful business model in the largest economy in the world. We have over five decades of experience and knowledge, and success, in forming and growing employee-owned businesses.

Over the next ten years, our organisations plan to spend more than $150 million dollars promoting and educating about ESOPs and employee ownership.

We are not just doing this in the United States, but in recent years we have begun to support the good efforts of people like Tej and David, and dozens of others throughout the world who are seeking to bring employee ownership to their economies. 

Because, despite being a proven model of business ownership for decades, employee ownership is still greeted with scepticism if not dismissal by those who are unfamiliar. It can be wrongly viewed by government officials as a tax dodge or an unproven experiment in economic development.

Other self-interested critics who may wish to maintain the advantages of an investor class of citizens, will tag employee ownership with labels like socialism that don't reflect the reality that these are, indeed, privately owned businesses that will succeed or fail and provide those rewords to their private owners. 

Or, critics like to point to single examples of ESOP failures rather than the overwhelming experience of tremendous success. I often say that had buggy whip manufacturers been ESOPs, their failure would not have been because buggy whips became obsolete, but their failure would have been attributed to the ESOP.

Starting in 2021, the Employee Ownership Foundation began sponsoring the annual Oxford Symposium on Employee Ownership, where we gather lawmakers, NGOs, practitioners and stakeholders for three days to surface and tackle the greatest impediments to employee ownership around the globe.

Through this work, I can report without doubt, that employee ownership as a model for business ownership, community stewardship, and economic resilience is rapidly gaining momentum and early movers in this next round of policy development are having an outsized influence on the global trajectory.

It is within this context that I believe I have found myself here. The Slovenian delegation has been a leading, dare I say central, participant in our Oxford symposium from the start. There are several unique, and groundbreaking innovations captured within your new proposed policies that have caught global attention. In particular, what caught my eye and has lead to discussions in the US Congress, are protections to ensure that once formed, the Employee Owned company remains so, and that should there be a near-term sale any public incentive is recaptured. 

The Horizon Ahead.

I wanted to take some time this afternoon to talk with all of you about what is on the horizon. To talk about what we have learned, and how that might inform the decisions and development of your own system of Employee Ownership within the context of your own economy and laws.

America is deeply divided, and at the core of that division is an economic travesty, where our smaller towns and communities, our rural areas that were once populated by thriving small and medium businesses - automotive and electrical component manufacturing, materials development and engineering, agribusiness, energy, construction - has been hollowed out by private equity and foreign investment that strips not just jobs but more importantly the wealth and economic vitality that comes with locally held ownership.

The pattern has become painfully predictable. An outside investor or buyer will come to a private business owner in need of a succession plan. They will offer dramatic multiples to entice a deal while making promises of careful stewardship of the company legacy and care for the existing employees and community.

The buyer recognises the value in the business, but in the end it is never about generating a long-term, sustainable enterprise with reasonable profit. Rather it is about squeezing every ounce of profit out of the business while maximizing the return on the capital investment in as short of a period of time as possible.

The single biggest export from America's small and mid-sized communities has become the wealth that was grown there over decades. Private Equity and Direct Foreign Investment have become extractive industries from America's communities, leaving in their wake more fragile economies as businesses inevitably get resold, or closed or merged and leaving those communities dependent upon subsistence jobs at the local Wal-Mart or McDonald's. They have left in their wake a feeling of hopelessness for those families who wish to remain where their parents and grandparents made their lives, and who wish to raise their families with the traditions and values they knew when growing up. 

This is the environment where slogans like Make America Great Again and us vs them political environments find resonance within rural communities of good people.

I share this with you because I believe it could foreshadow what lies ahead for your own local economies and businesses. While I am no expert, when I discuss the Slovenian experience and the coming tsunami of business owner retirements, I cannot help but draw the comparison to our own experience.

I am so deeply grateful, and hopeful, for the final approval of your new laws to incentivize and promote the establishment of Employee Owned firms within your economy, and the many rewards, and legacy, that will flow.

The benefits of employee ownership are not new to us, and have through decades of careful research, been proven over and over again.

Employee-owned firms generate higher wages, greater employee wealth, happier and healthier workplaces.

Employee owned firms are more resilient in economic downturns, as evidenced by their performance during and after both the great recession in 2008-2010 and once again during the global COVID pandemic. Employee owned firms were four times less likely to lay off employees and as a result emerged from those downturns much faster and resiliently than their non-employee owned competitors.

Employee owners have, on average, more than double the retirement savings of average workers.

Employee owners report significantly higher job satisfaction and in a study earlier this year were six times more optimistic about their community's future than the average American.

In that same study, even customers and consumers report higher satisfaction with service and products provided by employee-owned firms. Which stands to reason - as employees adopt an ownership culture they connect the quality of their work with their own long-term financial interests. As we say, the employee interests and the business interests become aligned.

Why is there urgency?

Slovenia, as is true in most developed economies around the world, is facing a massive generational opportunity to both strengthen your domestic economy while also re-investing the economic production of the last four decades within your own citizens.

As we all know, over the next ten years, almost every privately held business must transition to new ownership as the first generation of owners retires. Some will be passed to the next generation of the family. Many will be sold to or merged with a competitor or strategic buyer. Many will simply cease to exist - the assets sold off in liquidation sales and the jobs simply go away. 

Increasingly, there is concern about direct foreign investment from larger economies in Europe and the US, China or India, as those investors seek to leverage local your local business to benefit them.

In America, this generational transition will be the single largest transfer of wealth producing assets in history - $7.3 Trillion dollars of private businesses in less than ten years' time.

Here in Slovenia, over 65% of these business owners have no current succession plan.

At the risk of sounding hyperbolic, I want to emphasize just how important, and urgent, addressing this issue is. 

For your local communities and economies, this is an existential threat that could reshape every aspect of your way of life.

Business owners who wish to preserve their legacy within their community, these leaders who want to be respectful of the employees who have helped to bring them success, need an alternative to selling to a strategic buyer, or a competitor, or to private equity and foreign investors.

In the employee ownership community, it is too often forgotten that none of the benefits of employee ownership, none of the Public Good that comes from it ever exists without one small miracle happening: A business owner, or group of owners, must decide to sell their business to the employees. There must be a clear set of policies and regulations that not just make it possible, but legitimise the choice within a legal framework.

A business owner must be willing to relinquish THEIR wealth producing asset, so that their EMPLOYEES can have a wealth producing asset.

Facilitating that moment - what I call the miracle moment - is the challenge before you here in Slovenia. You have an excellent framework that is currently in the process of being fully articulated by your ministries. Details such as the principles of accounting used in businesses to become employee owned, the valuation of the underlying assets, the method of guaranteeing that incentives for selling to employees are recouped should the firm later be resold out of the employee-owned model. These are important details.

However, these details should not be allowed to derail or delay full adoption and implementation in a timely way. All too often the perfect can become the enemy of the good.

In America, we have just passed our 50^th Anniversary of the passage of our own laws that allowed for the creation of ESOPs. In those 50 years, we have revised, amended, or enhanced the initial legislation 17 different times through the passage of new legislation through Congress. 

Even today, our own top regulator, the Department of Labor, has STILL not fully articulated the rules and regulations for the valuation of our employee-owned companies.

We are still making changes to other regulations - lending policies, repurchase obligations when employees exit, management incentives, and trustee obligations. Yet 1 in 10 American workers have accumulated over $2.3 trillion in wealth through employee ownership.

No law is perfect when it is first adopted, and yours will be no different.

But you have a moment of opportunity, as the first generation of business owners must transition to the next.

As you all participate in this conference, and then return to your offices and workplaces, if there is any single take-away I would like to leave you with, it is this: you must find a way to make it not just possible, but probable that your businesses will become employee owned. That the best choice for a business owner is to sell to his or her employees when they retire or wish to exit the business. Employee Ownership can become the first option, and your local communities and economies, and ultimately your national economy, will be better for it.

Thank you.