UK-based fast fashion retailer Boohoo has taken an innovative step by giving shares to nearly 5,000 of its employees. This initiative is part of Boohoo’s efforts to foster a sense of ownership and loyalty among its workforce. The company, which is listed on the AIM stock exchange, allocated a total of 15,441,664 ordinary shares to eligible employees.

According to a statement seen by BusinessLive, 4,924 employees applied for the 2021 Share Incentive Plan (SIP) and have been granted 3,136 free shares each. These shares, valued at approximately £3,600 based on the purchase price of £1.15 per share, were awarded on 12 January and are subject to a three-year forfeiture period.

While the current value of Boohoo shares is slightly below the purchase price, they were trading at over £4 per share in June 2020. This suggests that if shares reach similar levels in the future, employees participating in the share plan could witness substantial growth in their holdings, especially if they receive future share grants.

Even the CEO, John Lyttle, and CFO, Neil Catto, have chosen to participate in the 2021 SIP and have been granted 3,136 shares each. This increases Lyttle’s share count to 188,172 and Catto’s to 79,735.

The decision to give shares to employees aligns with Boohoo’s broader strategy of engaging and incentivizing its workforce. By making employees stakeholders in the company, Boohoo aims to encourage them to contribute to its success and align their interests with those of the business. This approach reflects a growing trend among businesses to involve employees in the financial performance of the company, which has been shown to enhance motivation, productivity, and job satisfaction.

Apart from providing a financial benefit, the allocation of shares also reinforces employees’ sense of belonging and commitment to the company. It offers them a stake in Boohoo’s future growth and success, fostering a shared sense of purpose and promoting a positive company culture. By extending share ownership to a significant number of employees, Boohoo aims to create a more inclusive and democratic workplace, where everyone has a voice and a vested interest in the company’s performance.

Boohoo’s move to grant shares to its employees is part of its ongoing efforts to improve its corporate social responsibility and enhance its reputation in the fashion industry. In recent years, the company has faced scrutiny regarding its labor practices and supply chain transparency. To address these concerns, Boohoo has implemented various initiatives, and involving employees in the company’s success further demonstrates its commitment to fair and ethical business practices.

Moreover, offering employees the opportunity to become shareholders helps Boohoo attract and retain top talent. In a competitive market, this distinguishes Boohoo as an employer that values and rewards its workforce. This can be especially appealing to younger employees who prioritize working for companies that align with their values and provide meaningful opportunities for growth and development.

Overall, Boohoo’s decision to give shares to its employees reflects its forward-thinking approach to employee engagement and commitment to creating a positive and inclusive workplace environment. By allowing its workforce to become shareholders, Boohoo not only provides them with a financial benefit but also empowers them to take ownership of their roles and contribute to the company’s long-term success. This move highlights Boohoo’s dedication to cultivating a culture of employee ownership and aligning the interests of its workers with those of the company.

Useful links:
1. Boohoo Official Website
2. BusinessLive Article