June 6th through 8th I attended CommonBound, a conference to consider directions for a new economy, organized by the New Economy Coalition (NEC). A significant part of the future outlook is co-operatives.
One workshop I was lucky enough to attend was run by Marjorie Kelly and Janelle Orsi on social enterprises. Marjorie Kelly has been a pioneering writer on ownership; I noticed that her concepts of generative and extractive economies, were used widely elsewhere at this conference and appear to be integrated into the narrative for economic change. Janelle Orsi is an attorney and writer, well-known for her work based on sustainability, equity, and sharing. Their workshop demonstrated that local interests can suffer without local investment: if Wall Street controls a company, is there any incentive to invest in local communities? It’s a question that came up again elsewhere at the conference. How can co-ops afford to support business ideas like serving less profitable clientele and communities? The answer: democratic ownership and decision-making. Such an ownership structure allows for investment of surplus income that may not be strictly for profit. Equal Exchange was mentioned as a leader in this area with the ability to focus resources on ethical food production that might be a financial risk, e.g., supporting banana farmers.
Governance makes it happen. Governance is the management structure of an organization, also known as bylaws. The importance of governance was a guiding message from the Kelly/Orsi workshop. The composition of governance is critical and should be set up with careful consideration. But it can, and will most likely, be difficult work. A later workshop described the work involved in converting to a co-op that took 18 months for the landscape company, A Yard and a Half Landscaping, located in Waltham Massachusetts. That same workshop featured Cero a new Boston-based co-op that will collect restaurant waste and has wrangled with start up challenges for over a year.
Co-ops come in all shapes and sizes, but it is the governance that defines their organizational principles. Stacey Cordeiro of the Boston Center for Community Ownership outlined this in a workshop on co-ops. As Janelle Orsi described, a co-op can start to be defined by a tax status provided by the U.S. government called “Subchapter T.” It will provide a co-op with a tax structure supplied by the IRS, and start to provide bylaws for its management. Cordeiro outlined three components of Subchapter T as: 1. Subordination of capital. 2. One member, one vote, and 3. Operating at cost.
Co-ops are part of a movement to include all walks of life. Melissa Hoover and Joe Rinehart from the US Federation of Worker Cooperatives presented and discussed diversity in co-op development, and the importance of a venue for multi-language interaction. Co-ops can be all-inclusive and need to consider new approaches to inclusion. The CommonBound conference made an effort and was successful in bringing a diverse group of people together. NEC generously and wisely offered scholarships which helped me to attend the conference.
Co-ops are helping to change the world, but like any other part of change, they are hard work. Designing the governance of a co-op is a good example. Co-ops compel people to work together democratically to form and then run a co-op — the development of a democracy is work, and then the democracy it creates is work. A contradiction perhaps, but I don’t think anyone wants a work-free future. We’re looking for an inclusive future where we’re all doing work we love.
Nice and helpful post! It really takes me back to the days of working in the early days of the cooperative, community land trust, and community development financial institution movement, founding the Industrial Cooperative Association Revolving Loan Fund (now LEAF), helping finance and support cooperative businesses in a wide variety of sectors, and working with some of the most committed and dedicated people I have had the privilege to know.
I am now exploring cooperative development concepts in the health sphere, where we most definitely need people-centered, customer-controlled alternatives.