The Proper Business provisions are a standard set of commitments you embed in your company's articles from day one. They don't require our investment. Anyone can adopt them.
The provisions are designed to be straightforward to adopt, legally robust, and founder-controlled. You set the specific numbers — the pay ratio, the return cap, the wealth cap, the surplus nominee. Once embedded in your articles, they apply to all shareholders equally and cannot be removed without almost unanimous consent.
They are open. You do not need to be funded by us to adopt them. If you believe in the philosophy and want to build your company this way, take the language below and work with your solicitor to embed it in your articles.
The Company shall pay no less than the Real Living Wage to all employees.
The Company shall operate subject to a Maximum Pay Ratio of [A]x between its highest-paid and lowest-paid roles. Where there are no other employees, the annualised real living wage will serve as the 'lowest-paid role' remuneration for highest-paid calculations.
No Share, security, or economic interest issued by the Company shall carry an entitlement to receive value in excess of a fixed Investor Return Cap of [B]x the original price paid for such interest.
No individual who is, or has been, a Founder or an Employee shall be entitled to realise value in excess of a fixed Founder and Employee Wealth Cap of £[C]m, excluding ordinary salary, wages, benefits, and cash bonuses paid in the normal course of employment.
All Surplus shall be paid directly and irrevocably to the Surplus Nominee [D], it being a charity, trust, foundation, or other public-benefit vehicle not controlled by any Founder, Employee, or Investor.
This Schedule may be amended, varied, or repealed only by a resolution approved by not less than 95% of the total issued Shares of the Company. No amendment may take effect unless approved in accordance with this Article.
Below is the full template article provisions; the values in square brackets are yours to set, and it must be adapted to your circumstances with your own legal and tax advice as necessary.
The full articles are available as proper-business-articles.docx and proper-business-articles.pdf.
Loading the document…