What:
Foundation-owned firms are companies in which a non-profit foundation holds a controlling ownership stake. This is often through majority ownership of voting shares. Foundation-owned firms are less prevalent in the United Kingdom but are commonly found in European nations such as Denmark and Switzerland. This is because in nations such as Denmark, the legal systems actively support this organisation type. Unlike other parts of the world, a foundation in Denmark, for example, does not need to exist to serve a philanthropic or charitable cause. Danish industrial foundations can exist to serve the long-term survival of a company, rather than solely support a charitable purpose.
In such nations, the foundation is typically governed by a board of directors that has a degree of distance from the business. Directors tend to be appointed through the foundation’s governance systems, and their status is not impacted by shareholder votes. A benefit of this is that foundation directors can operate independently and make decisions separate from the influence of company CEO’s or shareholders. This means that foundation-owned firms can focus on the long-term sustainability of a business, rather than seeking short-term financial goals.
Example:
There is evidence of foundation-owned firms engaging in deep-tech adjacent fields. Novo Nordisk is a Danish healthcare company that specialises in pharmaceutical research, manufacturing, and marketing. The company is foundation-owned, with the Novo Nordisk Foundation owning a controlling portion of company shares. It uses a holding company (Novo Holdings) to control the company, to ensure it is protected from short-term funding pressures and make sure profits are reinvested back into the company and used to pursue wider humanitarian projects.
Deep tech considerations:
- Deep tech ventures often require significant investment and long development periods before delivering commercial returns. Foundation ownership could provide a suitable structure for these types of ventures, as it allows focus on long-term innovation rather than short-term financial performance.
- Many deep tech ventures are created to solve significant scientific or societal challenges. A foundation ownership model could help protect this purpose by reducing pressure from investors, who may prioritise financial returns over the wider objectives of the business.
- Foundation-owned firms are prevalent in Denmark and some other European nations but are less prevalent in the United Kingdom due to differences in legal and institutional frameworks. Geographical location and regulatory factors may therefore also be relevant when considering foundation-owned firms as a deep-tech model.
More Information:
James, J. (2023) The Role of Foundation-Owned Firms in Corporate Denmark. Perspectives on Business and Economics, 41, pp. 61–67. Lehigh University, Martindale Center for the Study of Private Enterprise. Available at: https://preserve.lehigh.edu/_flysystem/fedora/2024-08/Junmoke%20James.pdf (Accessed: 15 July 2026).
Hansmann, H. and Thomsen, S. (2018) The Governance of Foundation-Owned Firms. Harvard Law School. Available at: https://corpgov.law.harvard.edu/2018/03/01/the-governance-of-foundation-owned-firms/ (Accessed: 15 July 2026).
Prism The Gift Fund (2021) Foundation-Owned Companies: The Foundation-Owned Companies Model: UK vs Abroad. Available at: https://prismthegiftfund.co.uk/foundation-owned-companies/ (Accessed: 15 July 2026).