Clegg Unveils 'John Lewis Economy' Plan

Employee share ownership will be radically increased to create a "John Lewis economy", under new plans unveiled by Nick Clegg.

Liberal Democrat ministers are to explore ways of getting employee ownership "into the bloodstream" of the British economy - including the introduction of a right for workers to request shares in their companies.

The Deputy Prime Minister said employee-owned firms tend to perform better, which will help boost growth.

The move would also challenge the corporate culture and help usher in a new era of "responsible capitalism", he said.

At an event hosted by the City of London Corporation and the Centre Forum think-tank, he said the concept of employee ownership has been a "touchstone" of liberal thinking since the 19th century.

"We don't believe our problem is too much capitalism - we think it's that too few people have capital," he said.

"We need more individuals to have a real stake in their firms. More of a John Lewis economy, if you like.

"And what many people don't realise about employee ownership is that it is a hugely underused tool in unlocking growth.

"I don't value employee ownership because I believe it is somehow 'nicer' - a more pleasant alternative to the rest of the corporate world. Those are lazy stereotypes.

"Firms that have engaged employees, who own a chunk of their company, are just as dynamic, just as savvy, as their competitors. In fact, they often perform better.

"Lower absenteeism. Less staff turnover. Lower production costs. In general, higher productivity and higher wages. They weathered the economic downturn better than other companies."

Shadow business secretary Chuka Umunna said Mr Clegg was following Labour's lead on responsible capitalism.

"If Nick Clegg wishes to follow Labour's lead in promoting shareholder activism and engagement, that is welcome," he said.