This Preston contractor gives all profit left after investment to charity, organises free holidays for deprived kids and says it only exists for the benefit of its staff. Can this really be a recipe for success? Matthew Richards finds out.
Andrew Simkin drops his two-year-old son Joseph off at nursery school every day on the way to work. It's a routine that will be familiar for many parents, but in this case, the journey from nursery to work lasts the 30 seconds it takes to stroll across a car park. That is because Simkin works for Eric Wright, a Preston-based contractor with an on-site nursery and a business ethos that is, to say the least, out of the ordinary.

"People who join us from major national contractors can't get over our philosophy," says Peter Forrest, managing director of the construction division. It's not hard to see why – in contrast to most companies, Eric Wright's mission statement places the well-being of its employees above the demands of shareholders.

In addition to the nursery, the headquarters has a free on-site gym and weekly visits from a local GP. All company profit is either reinvested or given to a charitable trust. No wonder people who have come from large limited companies find it takes a bit of getting used to.

Simkin, for one, is a big fan. "It's unbelievably useful to have the nursery just across the car park. I know Joseph's safe, 30 seconds away. My wife works in Oldham full time – good quality childcare for young children is invaluable for working parents like us."

He says the nursery isn't just useful, it also reveals a lot about the bigger picture at Eric Wright. "It underlines the company's philosophy – it's a caring company interested in social aspects as well as profit and growth," he says.

The company wasn't sure how many takers the nursery would have among its 150 employees when it moved to a new headquarters six years ago, but chairman Eric Wright insisted on setting it up on a "build it and they will come" basis. It opened with just two children, but now looks after about 20. It now accepts applications from the general public, but Eric Wright employees enjoy a 30% discount.

In 1979, when Wright created the company that now bears his name, he didn't know where it was going to lead, but he knew he wasn't going to run the business along conventional corporate lines. At the time he was the 42-year-old managing director of a £3m subsidiary of construction conglomerate Brown and Jackson, based in Fleetwood on the Lancashire coast. When he heard the parent company was planning to sell off the subsidiary, he led a management buyout.

It was a bold entrepreneurial move, but the classic driving force of entrepreneurs – the desire to get rich – wasn't his main motivation. "He's totally people-oriented," says company secretary Michele Miller. He persuaded his colleagues to back his adventurous buyout, and some of them still work for him today. After the buyout Wright saw his business develop in leaps and bounds. By 1992 the company was making a profit of £2.1m on turnover of £22m, and had a reputation in north-west England as a recession-beater.

It’s a caring company, interested in social aspects as well as profit

Andrew Simkin, Eric Wright employee

In 1990 Wright set up the Eric Wright Trust, a charity that owns 49% of the company's shares and helps young people in the North-west.

Four years ago, the trust bought Water Park, a breathtaking estate boasting a mile of shoreline on Coniston Water in the Lake District. It spent £2m converting the mansion into an outdoor activities centre.

The centre has a "family and friends week" for Eric Wright employees every August. It also now offers residential courses to young people and subsidises those who cannot afford the cost. Young offenders, the disabled and underprivileged children have all benefited from recent visits. Last year 45 schools used the facilities, including two from the most deprived part of Preston, whose pupils were admitted free.

Devotion to charity isn't the only thing that makes Eric Wright unique. By the time the company moved to its present headquarters in 1996, it had quantity surveyors, civil engineers, architects, accountants and a solicitor all together under one roof. For a medium-sized regional contractor, that's a uniquely diverse range of skills. "If somebody comes to us wanting a building, we can find them a site, design it, put in the planning application, finance it, build it, and fit it out," says construction director Peter Guy. "Some firms can do two or three of those things, but very few can do everything."

And the company asserts that its caring, independent ethos extends to its business practice. "We concentrate on building a reputation, and if we have to take a hit on a job to keep that reputation, we'll do it," says Guy, who is due to succeed Forrest as managing director of construction in June.

All contractors claim to serve their clients well, but in Eric Wright's case it is backed up by the clients themselves. Developer Chris Brown worked with the firm over a period of 10 years starting in 1985. He says: "It sounds a bit platitudinous, but they're great to work with. They have a culture that respects partners and deals with people honestly, and that's also reflected in their charitable ethos. They're there for the long term."

Eric Wright's long-term goal is to carry on doing what it does now. Rumours of a planned stock market flotation a few years ago were wide of the mark: preserving independence was the rationale of the buyout that created the company in the first place. "Our aim is not to go public or national, but if you start standing still you tend to contract," says Forrest. Guy says his immediate goal is to raise construction turnover from its present £72m to £100m, which he says can be done without increasing capacity. In the long term, "five per cent growth a year would be just right".

Mill owners in this region in the 18th and 19th centuries provided for their staff – we’re going back to that

Peter Forrest, construction managing director

With Wright's 51% share in the company is to be transferred to the charitable trust on his death, the future of the business and the charity looks assured. The company has many characteristics of a family firm – financial independence, a long-term game plan, and a caring attitude to employees. But Wright says his decision to leave his shareholding to charity is not just altruistic – he also wants to avoid the potential conflicts of fragmented family ownership.

"As a company, we're quite unique," says Forrest. "We've got to ensure we don't lose our ethos as we get bigger." The company doesn't trumpet its differences, and although it has a good reputation, it prefers to keep a low profile.

Some might view Wright's way of working as highly innovative, but the firm likes to think of itself as traditional. "Over the last few years partnering has become the new industry buzzword," says Wright. But whereas it may seem new and radical to some, he can't see what all the fuss is about. He says: "We've been working on a partnering basis for 20 years." He adds that the same applies to design and build: "Wren, Brunel and Brunelleschi did design and build – it isn't new."

The firm's caring attitude to its employees is also rooted in tradition. Forrest points out: "Mill owners in this region in the 18th and 19th centuries provided for their staff, so in a way we're going back to that."

Company secretary Miller points out that, since she joined in 1980, none of the directors have left except through retirement. Retention rates among other employees are also above average for the industry. Forrest even claims Eric Wright has a reputation among subcontractors as an exceptionally good company to work for, which means subbies charge them a lower rate because they know they will be paid on time.

The firm has a "statement of intent" that begins: "The Eric Wright Group has a single objective, namely to provide its staff with secure jobs within the construction business." That makes the company a good place to work, especially in a harsh economic climate – even during the recession of the early 1990s, the firm avoided making any of its people redundant. The knock-on effect is employee loyalty and high levels of productivity.