Edrington’s ambition is to become the world’s leading premium spirits company.
Edrington’s strategy is to premiumise their portfolio of leading brands, to increase consumer focus and accelerate growth. The Macallan is the central focus supported by Highland Park and The Glenrothes in the fast-growing Single Malt category. As part of this strategy, Edrington recently unveiled the award-winning new distillery and brand home of The Macallan in Speyside.
Edrington have strategic partnerships with Tequila Partida and Wyoming Whiskey in the dynamic Tequila and American Whiskey categories. Their portfolio is completed with The Famous Grouse Blended Scotch Whisky, Brugal premium rum from the Dominican Republic and Snow Leopard vodka.
Edrington is headquartered in Scotland, employing around 3,000 people in its companies and joint venture operations worldwide, with over 70% employed overseas. Edrington own their route to market in 15 countries, operating the remainder through joint venture and third-party agreements.
Edrington can trace their history back to 1861 with the establishment of Robertson & Baxter as a whisky and wine merchant and later a whisky blender. The Edrington name came into existence when the three Robertson sisters inherited the whisky business founded and developed by their grandfather and father. In 1961 they formed the Edrington Group and created a charitable trust to be its principal owner and distribute its dividends to charities in Scotland.
The Robertson Trust has donated over £252 million to a variety of charitable causes since 1961.
Edrington’s business model revolves around great people, leading brands and an ethos of giving more. It is a company that reflects its philanthropic roots by actively encouraging employees to undertake fundraising activities under the Giving More banner. Edrington, alongside The Robertson Trust, match employee funds raised; £1 raised for charity by an employee becomes £3 after the additional contributions. Giving More raised £674,000 total charitable funds in 2018/19. These values also extend internationally where the Company donates 1% of pre-tax profits to good causes chosen by staff in its overseas offices.
From its unique ownership model to its core values of ‘Giving More’ and ‘Great People’, Edrington is a company focused on its people and community. With this culture ingrained in the Company’s heart it is no surprise that they have a long history of promoting employee share ownership, having had an ESOP in place for over 20 years.
Edrington have both a SIP and SAYE in place; they opt not to run Discretionary plans, instead focusing their attentions on the all-employee plans which effectively align the strategy of the business directly with their wider UK employee base.
The SIP is managed in-house, using Sharetrack, rather than outsourced, helping tie together the business and its employees more closely.
The plan comprises:
- An annual Free Share Award
- An annual Partnership Purchase
- Dividend reinvestment
The Free Share award is granted to all employees who have been with the Company for six months or more at the award date. It is calculated on the basis of each individual’s salary and length of service. Linking the award to length of service in this manner builds loyalty between the Company and their employees, with those who have worked with the Company longest receive an increasing share in the profits they are key to generating.
The Free Shares do not have any forfeiture provisions attached to them. Whilst leavers will be taxed upon exiting the plan, they can still benefit from the award if they were to leave before the third anniversary of the award.
The nature of Edrington’s business dictates a reliance on seasonal workers, many of whom return to work year after year. Whilst it would be easy for these individuals to fall outside the scope of the company’s plans, Edrington have specifically designed the Free Share award under their SIP to allow these individuals to participate. A seasonal worker who leaves and re-joins the company within three months of their leave date is deemed to have continuous service and will be able to keep their shares in the plan.
The generous structure of the Free Share plan is reflected in the 100% take-up rate for eligible employees and its flexibility clearly evidences Edrington’s commitment to Employee Share Ownership.
The Partnership award takes place annually and offers employees the chance to top up their share ownership with a purchase of Partnership shares.
The SIP allows employees to reinvest their half-yearly dividend into additional shares increasing their shareholding. Historically the reinvestment plan was ‘opt-in’ with employees thus having to choose to reinvest their SIP dividend payments. However, the Company have restructured this so now employees will automatically have their dividends reinvested unless they ‘opt-out’. This has seen an increase in employee share holdings.
Private companies often require employees to sell their shares when they leave employment. Edrington demonstrate a clear commitment to not just their employees but the community as a whole by allowing leavers to retain their shareholding under certain circumstances.
Edrington understand that communication plays a hugely important role in fostering employee share ownership within the Company. They have worked closely with Cytec over the last year to develop and launch a new employee share portal which provides details to employees of their share plan and personal holdings. Whilst the SAYE is administered through another provider, the data is passed across to Sharetrack enabling employees to see all shares information in one place rather than having multiple provider portals.
The portal also utilises Single Sign-on which provides a seamless login experience for employees.
Whilst the online communications have had an increased focus, this hasn’t detracted from the Company’s ‘personal touch’ approach to share plans communications. With many staff working away from desks and computers, it is vital that the Edrington team communicate with their employees via other methods, such as regular road shows and a dedication to being available to employees, face-to-face, as often as is possible.
Whilst fostering share ownership is a key goal of the Company’s share plans, it is also important for employees to have a liquid market in which to sell their shares should they need to.
To this effect Edrington run a monthly internal market in Edrington shares. Historically this has been handled manually, resulting in little visibility of the transaction for the employee and a huge administrative burden for the Company.
To simplify the process for employees, Edrington have been working with Cytec to develop an online internal market which is due to launch in Q4 2019. This market will be accessible via the existing Sharetrack portal and available to all shareholders.
Following their recent shortlisting for a 2019 ProShare Award, we’re pleased to announce that Edrington went on to win the award for Best Commitment to Employee Share Ownership in a Private Company.