The Workers Cooperative Code

Comment: Can the code be the basis for Worker Cooperatives  to Federate for the Mutual Benefit?

The Workers Cooperative Council (UK) seem to have re published an updated Workers Cooperative Code of Governance. ( see links).   It is a good document to get an idea of what a workers cooperative might be;  principles of governance, administration and  social and environmental ethos.  These are important but  needing to be backed up with viable ideas and practice. It seems to be a well-balanced document allowing scope for flexibility of interpretation while sketching principles of cooperative best practice.   Worker Cooperatives that adopt this code have the possibility of self-identification as a group.  This  implies other possibilities that might be of  mutual benefits to worker cooperatives as a sector.

  Worker Cooperative as such tend to thrive in federative mutual relationships, the classical example are the Mondragon Cooperatives in the Basque country.  These have federated and created their own mutually supporting environment. They call themselves a corporation but it is one with a federal structure allowing autonomy and sovereignty of each enterprise. There are few cases of cooperatives breaking with the corporation.  Membership involves the commitment to follow a set of principles including mutual support of the cooperative federation.   Worker members are required to make an investment which can be withdrawn on retirement with accrued dividends. Arrismendi the basque priest that inspired the formation of the Mondragon Coops worked on the principle of “equilibiro” which  simply means balance, a golden mean. The Mondragon Coops are neatly organised around social principles supported by competent practice. Benefits are divided between the individual members, the individual cooperatives and the federation in such a way that there are synergies and mutual benefits.  The Mondragon Coops are not perfections and have had to survive in tough conditions and sometimes run into problems.  They attract the admiration of a wide spectrum of opinion from social liberal inclined co-ownership supporters, worker cooperative fraternity, and now even some revisionist Marxists.

The Mondragon Coops were obliged by  difficult circumstances, with high unemployment in the aftermath of  Spanish civil war, to be self-generating and substantially self-sufficient, as also were the first cooperative form with long-term viability, the Rochdale pioneers the founders of consumer cooperatives in the UK which has been copied around the world. The default position of these cooperative developments was self-reliance, this tended them to a pragmatic approach while retaining some basic social principles.  This is not an easy balance, too much pragmatism might squeeze out social or ecological objectives, too much idealism viability.  A default position that assumes autonomous self-sufficiency will build robustness into the enterprises.  

A federative relationships between worker cooperatives would need to bring benefits to members as individuals and cooperatives.  This will mean developing secondary cooperatives and  organizations which support the federation.  Finance  is an obvious first port of call, which  builds up social capital and in the long-term can become self-sufficient and give returns on a “symmetry of benefits” principle.  The term “triple bottom line” is a near equivalent term, meaning that the benefits need to conform to good social and ecological practice while at least breaking even financially.  This is a challenge as a sustained effort over time may be needed to building up sufficient mutual capital  to “critical mass” and be effective.   This certainly applies with financial mutuals such as credit unions or social investments societies as IPSs  ( See link to Community Shares).  To be viable they need to manage sufficient funds which generate enough income  as fees, interest and or dividends to cover costs of administration and give sufficient returns to attract investments. Currently many such funds rely on a  those with  philanthropic attitudes and  with spare cash  to invest in them , but this will never generate enough capital to develop a significant worker cooperative sector. The other source of funds are grant derived revolving funds; these tend to be static and dependant on whatever political dispensation is at hand.   A substantial emergence of worker cooperatives needs to generate sufficient benefits to make it worth while  for member workers and a constituency of associated supporters in their community to invest in them; perhaps a micro-pension.  Care would be needed to keep such an enterprise as “corporate light”, meaning transparent, democratic and with an engaged membership. Without such a  developments the sector is likely to remain  marginal. If these suggestions are considered to have merit  there will need carefull planing and costing. Success will set up a virtuous spiral.

The Worker’s Cooperative Code  with a few additional clauses to  accommodate  more definite support for shared secondary cooperatives can set the principles for these developments.  Cooperative structures and relationships need supportive cultures  which predispose members and supporters to act accordingly in mutual solidarity.  Attention is needed to develop competent administration and relationships conducive to cooperation within democratic enterprises but cooperation  implies a facing out and  cooperative relationships with people outside. There are some pieces required for the jig saw puzzle already  around, they need putting together in a definite way; is this possible?

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