Steward Ownership with Derek Razo and Camille Canon

Mar 1, 2023

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INSIGHT

Steward Ownership vs. Other Models

Steward ownership models prioritize purpose over profit, legally binding companies to their mission.
Other models like co-ops, B Corps, and PBLLCs maintain tension between purpose and profit.

INSIGHT

Steward Ownership Principles

Steward ownership has two key principles: self-governance and profit serving purpose.
Self-governance protects a company's mission, while profit serving purpose ensures profits reinvest in the mission or stakeholders.

INSIGHT

Benefit Corporation Limitations

Benefit corporations allow mission considerations within dual fiduciary duty, balancing it with financial shareholder value.
This doesn't guarantee mission-driven decisions nor protect the legal structure from shareholder changes.

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Steward ownership is one of the single most important concepts to understand for those interested in reforming capitalism. Whereas all other models of corporate governance that seek to integrate purpose co-ops, public benefit corporations, B Corps, and PBLLCs leave intact a fundamental tension between purpose and profit, steward ownership instantiates profit in service of purpose in a way that is legally binding. Steward ownership is where the keys to the castle lie if we are interested in market economy that addresses the fatal flaws of capitalism as we know it.

Our guest for this episode are Derek Razo and Camille Canon, co-founders of Purpose US, a consultancy supporting companies looking to adopt steward owned governance models.

In this conversation Jenny, Derek, and Camille discuss:

What is steward ownership? [4:41]
Steward ownership vs. other familiar corporate governance models [6:50]
Channels for profit in steward owned and other governance models [10:29]
Importance of legally binding structures in reforming the economy [11:27]
Value clarifying purpose amongst stakeholders [12:10]
Steward ownership and securing purpose across multiple generations of leaders / protecting purpose against capture by any particular group's interests [13:01]
Rethinking the definition of ownership [16:05]
How steward ownership binds governance rights to purpose [18:37]
Checks and balances to limit extraction with steward ownership [20:30]
Legacy of steward owned models around the world [22:43]
Camille and Derek's ladder of legal security for purpose driven governance [24:16]
Entity types and legal forms for steward ownership [31:15]
Steward ownership models vs. non-profits [33:29]
Challenges accessing finance [35:13]
Overcoming the growth stage financing gap without losing control [38:00]
Innovative financing models [39:02]
Founder leverage and alternative deal structures [40:24]
The Purpose Futures Fellowship for fund managers [42:52]
Steward ownership and DAOs [49:48]
Web3 and new sources of liquidity [52:58]
Current state of steward ownership interest and adoption [54:54]

‍Resources

Steward Ownership: Rethinking Ownership in the 21st century A handbook outlining steward ownership
Can Companies Force Themselves To Do Good? A feature in The New Yorker Magazine
The Patagonia Structure in the Context of Steward-Ownership

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