Disclaimer: These communications are intended for the employees of HB Global. We recognize that the general public will have access. The views expressed in these communications represent Bob Whalen in the context of HB Global and may not apply to broader audiences.
In March, eligible employee owners received their annual ESOP statements. These statements show the amount that was added to their employee owner accounts based on the results of the prior fiscal year. They also show the total balance in their accounts based on their entire time at HB Global.
These ESOP statements are truly testaments to the value that we can create and share as an ESOP. More than that, they demonstrate our ability to generate real wealth for our employee owners. Through these statements, we don’t just see the enterprise value that’s been created, but instead we see how each individual employee owner has benefited from that value being shared.
Maintaining and protecting employee owner wealth is one of the reasons that Balance is one of our HB Global principles.
Our Balance Principle
“We balance short-term success with long-term sustainability. We don’t let our sense of urgency cloud our long-term view. As an ESOP, our long-term success has the power to impact multiple generations, and that’s why we focus on growth and compounding, rather than exits influenced by market volatility. We make decisions that not only build, but most importantly protect, the wealth of our employee owners for generations to come.”
What Balance Means
Both our company as a whole and the employee owners within it depend on both short-term and long-term outcomes. Any organization wants to be successful in both the short-term and the long-term, but as an ESOP, this takes on deeper meaning.
As an ESOP, we prioritize building and sharing wealth with our employee owners. This happens over the long-run. Balances grow over time from annual contributions as well as from compounding, when existing shares benefit from any increases in the share price.
We can’t just focus on quarterly or even annual outcomes. We need to focus on what will continually build wealth for our employee owners. We also need to focus on protecting that wealth. The long-term sustainability of our company is the priority. We can’t let a sense of urgency for short-term results impact our ability to make sound long-term decisions. The only way we continue to share wealth with our employee owners is if our company continues to exist.
It’s also important that we recognize that the long-term is made up of a series of short-term successes. We can’t ignore the short-term.
This principle reminds us that we shouldn’t sacrifice long-term outcomes or sustainability for a sense of urgency to be successful in the short-term. Our short-term outcomes should support our long-term success. This outlook informs our strategies.
Why Balance Is Important
It isn’t just our job to build wealth as an ESOP but also to protect it over the long-term. It does us no good to have a fantastic year for our employee owners if it puts the wealth in their retirement accounts at risk over the long run.
This approach not only impacts our employee owners directly, but it has the ability to impact generations to come. This happens in a couple of ways.
When an employee owner accumulates a significant retirement account balance, they gain peace of mind during both their working career and beyond. This feeling of security positively impacts both the employee owner and their loved ones.
Furthermore, having a significant retirement balance allows the employee owner to take care of themselves and their families in retirement while maintaining the same standard of living that they did during their working years. This relieves pressure and burden from both the employee owner and their spouses, children, grandchildren, etc.
Balance also allows our business to be successful over many generations, allowing us to create and share value with not just the current generation of employee owners but those to come.
If we don’t balance short-term and long-term outcomes, we may lose sight of the wealth we need to build and protect for current employee owners, retired employee owners still receiving distributions, future generations of employee owners, and the families that depend on these employee owners.
How We Live Balance
Creating balance isn’t just the responsibility of our leadership team. We all play in a role in balancing the short-term and long-term view throughout our organization. Here’s how living our core values allows us to do that.
Trust
We create Balance by honoring our commitments. We don’t take the easy way out for short-term convenience or gains. We commit to the long-term success of ourselves, our teams, and our organization.
Team
Balance comes when we check our egos at the door. We aren’t focused on what we can do to “get ahead” today, but instead, we focus on how we can help each other be successful as a team to build value.
Grit
We recognize that our work is more of a marathon than a sprint. While there are times we may need to sprint, it shouldn’t be how we constantly operate. We sprint when we need to, but we recognize that we can’t let one portion of the race put the rest of the race in jeopardy.
Growth
We focus on our individual growth and the growth of the company. We don’t expect overnight success but instead recognize that getting a little bit better every day allows us to be truly successful.
We achieve true balance when we allow our short-term outcomes to grow into long-term success. This momentum builds and protects wealth for our employee owners and generations to come.
Have your own thoughts or questions about the HB Global Balance principle? Send them to [email protected].