A Pacific Northwest-based bakery chain will no longer be privately owned by family and longtime employees.
Instead, Grand Central Bakery announced it would create a “perpetual purpose trust,” a new type of corporate structure that vests shares in a company not in individual owners but in a mission. Under this structure, company officials said, the bakery will aim to uphold principles, not profit.
Grand Central will complete the transition this summer, during which it will become one of the few U.S. companies to be owned by a perpetual trust, the bakery said in a news release. For employees, ownership of the trust “means knowing that the profits will stay with the business and that the company’s leadership commitment to fair compensation and strong benefits will remain a priority,” he said. said the company.
“We wanted to plan for the future and protect the company that we have all worked so hard for,” Grand Central CEO Claire Randall said in a statement on Tuesday. “Day to day, this means things will stay the same for customers and employees and we will continue to be independent and part of the community.”
First known simply as The Bakery, Grand Central was founded in 1972 by Gwyneth Bassetti in Seattle. The company has approximately 370 employees. Today, the company has 11 cafes, wholesale bakeries in the Portland and Seattle areas, and sells its baked goods at dozens of retailers in the Pacific Northwest.
The company said a perpetual trust also provides a “succession plan in a way that preserves the company’s culture, values and mission.” A seven-person independent board will oversee the trust and work with the CEO to “set direction, policies and parameters to guide operations and decision-making,” the bakery said.
Only five states — Delaware, New Hampshire, Maine, Oregon and Wyoming — have trust laws that allow perpetual trusts, according to Foundation Purpose, a non-profit organization launched in 2017 with the aim of shifting the focus of capitalism from profit maximization and shareholder primacy to a larger goal. To do this, the foundation created a new subset of trusts that do not exist for the benefit of one person or family, but to fulfill a purpose.
Two other Oregon companies have adopted this new type of ownership. Based on Eugene Company from organic farmingone of the nation’s largest independent organic distributors, changed ownership to a perpetual trust in 2018. Local Ocean Seafoods, a seafood market and restaurant in Newport, also announced plans to switch to a similar trust.