The business technology consulting company Sofigate has nearly 300 employee shareholders. According to the founder Juha Huovinen, the best result is achieved when people feel a shared sense of ownership of the company’s future.
Ethics. This word is repeated often by Juha Huovinen, the founder of the business technology company Sofigate. The topic is close to Huovinen’s heart as a strong sense of ethics was the key theme when he founded the company 20 years ago. The very existence of Sofigate is built around it: its story, business, vision, company culture and ways of working.
“We are firm believers in ethical business. It’s the only way to succeed in the long term,” says Huovinen.
Ethics also relates to Sofigates’s shareholder programme, which gives all employees, regardless of their title or work experience, the opportunity to become owners of the company. Currently, nearly 300 out of approximately 750 Sofigators are employee shareholders.
“Ethics is strongly linked to equality and non-discrimination. They must be guaranteed in everything, also in salaries and rewarding. That’s why we don’t have a traditional partner programme where you climb the corporate ladder until, perhaps, one day you reach the top and get rewarded. It’s a conservative model.”
Huovinen underlines that an employee’s potential shareholding in no way affects their position at the company. Shareholding is purely voluntary and does not entitle to any special status within the company. All relevant company-related information is available to all employees.
In the employee shareholder programme, Sofigate’s partner is Evli Alexander Incentives (EAI). Through the online shareholder portal provided by EAI, share purchasing and selling market is arranged for Sofigate employees once a year, where the price is determined by revenue, profitability and net debt. This means that every year Sofigate employees get an opportunity to consider whether they want to invest in their employer company’s share. Employees can also view their shareholdings and sell their shares yearly if, for example, their life situation so requires.
“Predictability is enhanced when people know the next year’s price.”
According to Huovinen, the purchase and sale prices have followed the performance of the Nordic stock exchanges – except this year when the Sofigate share price has increased substantially contrary to the general stock market trend.
“We’ve been tremendously pleased with this. People really value the programme. Among the enrolled employees, turnover has remained low.”
For Sofigate, employee shareholder programme is one way of committing people. Huovinen makes no secret of how their employees are the most sought-after top-notch professionals in the job market.
“When people feel a shared sense of ownership, they are genuinely interested in the company’s development, revenue growth, profitability and how to improve them.”
Huovinen reminds, however, that professionals are not solely motivated by money and the purpose of a company’s existence should not be based on the pursuit of a hefty exit payout.
“We want to make Sofigate truly global, since that allows us to make a bigger impact on the world. Stock exchange listing may be one option, but if that would be the only goal, we would have done it ages ago. That’s why we don’t talk about exit but about the good we can accomplish.”
Huovinen warmly recommends an employee share plan to other companies as well. The key is to tailor it to fit the company’s culture and values.
Huovinen also emphasises the importance of having a professional to organise the programme. Someone must connect the people purchasing and selling shares and take care of rules, agreements, taxation, legislation, financial transactions, calculations, data security and other regulations.
“Our programme fits nicely our way of thinking and culture. It doesn’t have any design flaws, so I wouldn’t change a thing.”
Text: Miia Savaspuro
Picture: Kerttu Penttilä
Kristina Wichmann, Evli Alexander Incentives Oy, +358 50 560 5507, firstname.lastname@example.org