John Lewis could change employee-ownership structure

The John Lewis Partnership could be on the verge of changing its famous employee-owned business structure in a bid to raise external investment in the company.

According to reports in the Sunday Times, its chair Dame Sharon White is believed to be in the early stages of discussions to dilute the mutual structure so it can bring in investors from outside.

This would involve selling a minority stake in the business, which in itself would require a change to the John Lewis constitution, and the money raised would go into growing the business.

As employee-owners, any decision would have to be voted on by the partnership council, which is made up of around 60 staff.

Last week, the partnership announced a pre-tax loss of £234 million for the 2022-23 financial year, and for only the second time in more than 60 years, said partners would not receive an annual bonus.

This first happened in 2021 due to pandemic-related losses but was reinstated in 2022 after revenues recovered. It has also hinted that job cuts could be on the horizon.

“As we need to become more efficient and productive, that will have an impact on our number of partners,” said Dame White, who has tripled the company’s savings target from £300 million to £900 million by 2026. This will also mean selling off a number of assets such as the John Lewis golf club in Berkshire.

According to the reports, selling shares in the business would aim to raise between £1bn and £2bn so the company could invest in better technology, data analysis and improve the supply chain at Waitrose.

The company has often been held up as a model employer due to its partnership structure, fair wages and ethical values.

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Last year John Lewis and Waitrose offered free food to workers who were struggling with the cost of living during the winter months.

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