Kenneth D. Baker began turning over stock in his company to employees in 2006; today, the Southampton-based NewAge Industries is entirely employee-owned.
And there are 16 millionaires among the 226 employees, some of them working on the factory floor, said Baker, CEO of the plastic and rubber-tubing manufacturer.
“I wanted a high-performance company, and if you don’t give ownership to the employees, you’re not going to get that extra effort that owners give,” said Baker, 67, of Ambler.
Now, Baker hopes to help more companies regionally and nationally see the benefits of Employee Stock Ownership Plans, or ESOPS.
The CEO has donated $3 million to Montgomery County Community College to start the Baker Center of Excellence for Employee Ownership and Business Transformation, which will promote and educate about ESOPS and other employee-employer partnerships.
It’s the largest gift in the college’s 56-year history, said Victoria L. Bastecki-Perez, president of the college.
“Ken is enabling us, as an organization, to advance our strategic agenda, our mission and our vision of inspiring, leading, and transforming not only the lives of our students, but our community,” she said.
The new effort will help with the region’s workforce development and economic recovery, she said.
The new center, which will support county and regional businesses, will be on the college’s Blue Bell campus, Bastecki-Perez said. It will include an open-resource library and host certificate programs, workshops, and events, and provide courses.
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Baker has been a longtime donor to the college, providing about 15 scholarships per year. One scholarship recipient ended up getting a full-time job at NewAge Industries, and later his father, who was looking to transition, got one, too, Baker said.
Since 2008, Baker has served on the college’s foundation board and has lectured at the school. His wife, Valerie, has taught psychology there for more than 20 years and his daughter is an alumna.
While beneficial for employees, ESOPs also help employers, who are looking for highly motivated and talented employees, Baker said. They can help if the business owner wants to create a succession plan, he said, and there are tax benefits.
“There’s going to be lots of conversation and courses [at the center] about how employee ownership changes the culture of a company and how it makes it much more productive and creates wealth for the employees,” he said.
Employees don’t want to misuse equipment or waste materials because it’s their equipment and materials, too, he said.
Baker grew up in Hatboro and went to Upper Moreland High School. He tried college, but found that he had dyslexia and that college really wasn’t for him.
In 1985, he joined NewAge Industries, which was started by his father. But Baker said he actually began working at the company much earlier, when he was 6. He prepared mailings at the family’s dining-room table, and served as a janitor of sorts when he was in high school.
He bought out his father and brother in the 1990s, he said, and became “the last Baker standing.”
About that time, he recalled seeing a mailing about employee ownership and attended a conference in Chicago. He was intrigued.
The company had more than $100 million in sales in the last year, Baker said, and it most recently has been involved in the making of tubing systems for COVID-19 vaccine production.
“We are very proud of that,” he said, “and we are very, very busy.”