Grand Central Bakery is changing its ownership to a perpetual purpose trust in a move designed to shield the 33-year-old company from any future sale and protect its mission in perpetuity.
The new ownership structure under the Grand Central Bakery Trust is expected to be completed this summer. Produce distributor Organically Grown Co. went through a similar transition and has been championing the option for other mission-driven businesses and worked with the baker.
Under the trust ownership the bakery, which has 370 employees across 11 sites in Portland and Seattle, will remain independent and profits will be invested in local farms and other producers and provide opportunities for employees to share in company success.
“We’re thrilled to be pioneering this new form of ownership,” said Claire Randall, Grand Central’s CEO in a written statement. “It’s so important to us that we preserve our ability to make decisions based on our values and run the business sustainably without sacrificing quality and craft.”
Randall will remain CEO, and day-to-day operations are not expected to change. Under trust ownership a new seven-member, independent board will be created. The board will have fiduciary duty to the trust and to the company. The board and CEO will work together on direction, policies and operations.
The board also ensures the company’s actions are aligned with the trust’s purpose.
A perpetual purpose trust is a non-charitable trust created to benefit a purpose rather than a person. This means the owner will never die or retire. In this case the purpose is Grand Central’s mission to nourish people and the planet. Trust ownership is designed to ensure that a company will not be acquired, broken up or forced to prioritize profit over purpose.
“As a trust-owned company, we can focus on growing in a way that continues to benefit local farmers, our employees and the communities we serve without the uncertainties that can come when companies are bought and sold,” Randall said.
Grand Central worked with a team at Alternative Ownership Advisors to explore this option. AOA is the consulting arm of Organically Grown Co. In 2018, OGC transitioned its ownership to the Sustainable Food and Agriculture System Perpetual Purpose Trust and helped to create a way for other mission-driven organizations to pursue similar paths, including launching an investment arm.
Grand Central was founded in 1989 in Seattle. Randall and most of the leadership team are here in Portland. The company has seven bakery-cafes in the Portland-area, with a new one expected to open in Hillsboro next year. It also has four bakery-cafes in Seattle.
