By: Julie Thorpe


Co-operatives and Employee-Owned Enterprises

Tomorrow’s Work Organisations

Why should companies care about co-operatives?

  • Workers have often turned to co-operatives as a way of sustaining or saving their own jobs. For example, the Argentinian ‘recovered enterprises’ movement and ESOPs in the USA.
  • Consumer co-operatives are a way for workers to access goods and services at reasonable prices. Read this think piece by Stirling Smith.
  • Co-operatives could be a useful and appropriate form of organisation, especially for workers in the informal economy. The ILO’s SYNDICOOP project showed how; and there is discussion here.  Just Solutions’ Stirling Smith wrote the training manual for SYNDICOOP and you can download it here.
  • In the current economic climate, increased attention is being given to alternative ways of organising production and wealth distribution.  There is ample evidence that the limits of the 19th-century joint-stock corporation have been exceeded and are now proving counter-productive to gaining cohesion around shared socio-economic development goals.  Conflicts arising from the division of societies into ‘haves’ and ‘have nots’ have become too profound to allow this outdated model to remain sustainable.

It is our belief that the sustainable corporation will need to include its stakeholders inside its decision-making structures and that the emphasis will shift inexorably over the next few decades from servicing capital-owners (share/stockholders) to servicing a wider community of stakeholders that embraces employees and the community within which the firm operates.  This will also require a revaluation of ‘capital’ to include intangible assets (knowledge, innovative perception, HE and skills) as a measurable component of corporate accountability, shifting aspects such as training and R&D to the asset side of the balance sheet.

For these reasons, Just Solutions pays considerable attention to supporting efforts to expand and explore new developments in the areas of co-operatives and employee ownership.

Just Solutions’ Director of Projects, Stirling Smith, is a world expert in co-operative formation and development, having worked on this sector for the ILO, for the Co-operative College Manchester, UK, and in a number of locations throughout the world. Its Founder and Director, Vic Thorpe, is a long-term member of employee ownership networks in the US and Europe. He strongly believes that broader employee ownership will feature in business models for sustainable success.

Beware of Bogus Co-operatives!

There is a specific ILO Recommendation on Co-operatives that clearly states they should not be used to undermine freedom of association. There has been a number of complaints to the ILO supervisory machinery about bogus co-operatives. It seems to be a particular problem in parts of Latin America, Philippines and Italy – often associated with hired labour on large farms.

Most social auditors would not recognise a bogus co-operative – Just Solutions can. Here is Stirling Smith’s guide to the ILO Recommendation No. 193.