Blog - Reserved Matters in Action

3 EO companies, 2 days, 3 Reserved Matters

All very different companies being impacted by different things, but with a similar requirement to liaise with their shareholder (the EO Trust) on significant decisions that are being made.

When trust meetings are following a rhythm there will often be a topic that crops up between meetings that requires a bit more focus, engagement, review, consideration and, in some cases, formal sign off.

When a company transitions into employee ownership, the focus of the leadership can change, but the requirements of the governance structure creates a shared responsibility to consider anything that may significantly impact the business:

• growth opportunities, significant investment for the future, new products / services;
• challenges to cashflow, market and external impacts, longer term viabiity;
• significant organisational changes to build for a long-term sustainable future.

While it would be inappropriate to discuss the details of the 3 meetings held, their approach to seeking shareholder input, involvement and ultimately (in some cases) decisions, demonstrates a strong governance structure—one that creates opportunities to challenge, support, encourage, and engage.

Elsewhere, in more than one conversation over the last fw weeks I’ve heard discussions on the benefit of testing the reserved matters process … the when, and how.

Taking a potential reserved matter and walking through the process without the urgency that these often have. Then when it needs to be enacted for purpose, the role play will have given all those involved a framework for how to approach it.

The recent reserved matters meetings showed how an engaged leadership team incorporates the referral to their trust as a part of their decision making as they (not the trustees) lead into the future, whatever that future may hold.