RBS was mired in more controversy last week after ignoring calls to create a shareholder committee with a remit to improve corporate governance. It follows Prime Minister Theresa May’s U-turn on direct employee representation, a pledge she made while campaigning for the Conservative leadership last summer when she said: “We’re going to have not just consumers represented on company boards, but workers as well.”

Many business owners were concerned about confidentiality and diluting their boards’ primary responsibility to act in the interests of shareholders, and have since lobbied against direct employee representation.

But involving employees at a senior decision-making level can deliver significant benefits to a business, no matter what size.

Research shows employee-owned companies with a participative workforce perform better financially, are more resilient during downturns and have lower staff turnover and lower levels of absenteeism. Jacqui Martin says if staff feel they own the company, customer service will also be higher.

Martin, of 4 Purpose, is passionate about building better workplaces that put people at the heart of all that they do.

She says the idea of organisations being employee led without necessarily being employee owned is of increasing interest, as often there can be financial participation in a company in terms of shareholding without the sharing of any of the other rights or responsibilities of ownership. Employee led means that leaders involve the employees in creating projects and giving them more autonomy in their working lives.

Martin says: “My experience is all related to employee owned companies where knowledge, power and rewards are shared so it absolutely makes sense for there to be employees on the board. If you’re in a company where everyone can fit into the one room for a meeting and be consulted on key decisions then there’s not necessarily the same requirement for employees to be on the board.”

She cites niche oil consultancy Accord Energy Solutions as an example. Based in Aberdeen, Accord has around 30 staff. It has two elected employee directors and there are also two elected employee trustees who sit on the employee ownership trust alongside the managing director and two independent trustees. Accord consulted their colleagues on a number of different issues such as how bonuses should be decided.

All staff took part in an away day in 2015 to discuss purpose and values, and they were consulted on what needed to be done to take employee ownership to the next level. The result? Positive, with a number of self-driven projects being taken forward by members of staff.

“Involving employees at a senior decision making level means that you can tap into the ‘collective intelligence’ of the organisation,” says Martin. “Those on the front line often approach a problem with a fresh perspective. It’s also a tangible demonstration that power is being shared.”