The Employee Owned Trust: Richer Sounds

  • The successful UK retailer became an Employee Owned Trust in 2019 after its founder, Julian Richer, sold 60% of his shares to the trust.
  • It marks the culmination of 40 years of responsible business practice that prioritised the welfare of its staff through paying a real living wage, opposing zero-hours contracts and offering year-round access to company-owned holiday homes.
  • The company is committed to becoming carbon neutral, free from conflict minerals and paying its fair share of tax.
  • Having spearheaded campaigns against zero-hours contracts and aggressive tax avoidance, Julian Richer has now launched the Good Business Charter accreditation scheme to encourage more responsible businesses and signpost customers to them.
Julian Richer speaks at the CBI conference 2020

When Julian Richer tried to open his first shop at 19 years old, he says landlords would just laugh at him. But after he did manage to open his first branch of Richer Sounds at London Bridge in 1978, it made more sales per square foot than any other shop in the world.

Twenty-one years and 51 more stores later, Richer’s audacity made people laugh again. This time it was his surprised and grateful staff, who he awarded £1k per year of service as part of a transfer of the retail company to an Employee Owned Trust in 2019.

All about the people

The company has always made staff welfare and rewards central to how it operates. As well as opposing zero-hours contracts and paying a real Living Wage, Richer Sounds offers employees a hardship fund for those struggling financially and year-round access to company-owned holiday homes across the UK. It also trebled sick pay for staff during the Covid pandemic and didn’t force anyone to work in stores who didn’t want to.

“I’ve been running my business for 40 years and the overriding thing I’ve learned is that it’s all about the people,” says Julian Richer. “If you treat your people right, then they are going to be happier, give a better service and stay with you for years.”

This sense of responsibility to its workforce also extends to other areas of the business in what it calls ‘The Richer Way’, which includes working towards becoming carbon neutral and free from conflict minerals across its supply chains, zero tolerance to slavery, a commitment to paying its fair share of tax and donating 15% of its profits to charity.

The Good Business Charter

Part of the reason Julian Richer decided to hand over Richer Sounds to his staff was to concentrate more on pursuing this responsible business agenda beyond the company. Over the years, he had set up numerous charities and social justice campaign groups, including Zero Hours Justice to ban the exploitative employment practice, and Tax Watch to investigate and expose aggressive tax avoidance.

Most recently, in 2020, he launched the Good Business Charter initiative to help encourage other businesses to behave responsibly and help customers identify those that are to then support them with their wallets. The ten-point charter sets a high bar for businesses to be accredited to the scheme, from staff representation on boards to ethical sourcing.

“We need to differentiate between good businesses and bad businesses,” says Julian Richer, who says bigger businesses who have refused to join must have sinister reasons for not doing so. “We don’t want someone joining who isn’t paying the real Living Wage or isn’t paying tax… because all the ten points are absolutely relevant.”

Interestingly, one of the scheme’s more than 500 members (so far) has said that as well as it helping to point out gaps and galvanise management to do something about them, the Charter was more relatable to staff and customers than the United Nation’s Sustainable Development Goals, upon which it is closely based.

Being responsible is just good business

For Julian Richer, being responsible is just good business and has proven to be so for the whole of his retail career. In the introduction to his book, The Ethical Capitalist, he explains this responsible business outlook and the obvious benefits it brings:

“I mean treating staff, customers and suppliers honestly, openly and respectfully. I mean doing what we say we will do. I mean taking responsibility for our actions, owning up when things go wrong and setting out to put them right. I mean seeing ourselves as an integral part of society and paying our dues – especially taxes – accordingly.

“By following this approach, I believe we create a virtuous circle for ourselves: Not only is it the right thing to do, we sleep better at night, and I believe a fair and honest approach to customers and staff leads to a huge competitive advantage.”

Image credit: Richer Sounds blog Christmas Gift ideas from Richer Sounds - Richer Sounds Blog | Richer Sounds Blog