"The Oxford Handbook of Mutuals and Co-Owned Business" investigates all types of 'member owned' organizations, whether consumer co-operatives, agricultural and producer co-operatives, worker co-operatives, mutual building societies, friendly societies, credit unions, solidarity organizations, mutual insurance companies, or employee-owned companies. Such organizations can be owned by their consumers, the producers, or the employees - whether through single-stakeholder or multi-stakeholder ownership.
Jonathan Michie, Director, Department for Continuing Education and President, Kellogg College, University of Oxford, Joseph R. Blasi, J. Robert Beyster Distinguished Professor, Rutgers University School of Management and Labor Relations, and Carlo Borzaga, Professor of Economic policy at the University of Trento (Italy) and President of the European Research Institute on Cooperative and Social Enterprises (Euricse).
Introduction and Overview.
This handbook analyses, describes, and explains the complex world of organizations that assign ownership rights and governance control to stakeholders other than investors. The complexity of this set of organizations results both from the different degree of control exerted by stakeholders in each typology, and from the different legislative and regulatory frameworks that govern these organizational forms.
This handbook covers the whole range of ‘member-owned’ organizations, whether consumer co-operatives, agricultural and producer co-operatives, worker co-operatives, mutual building societies, friendly societies, credit unions, mutual insurance companies, or employee-owned companies. Co-operatives can be owned by the consumers, the producers, the employees, or by other members—whether through single-stakeholder or multi-stakeholder ownership. By ‘significantly employee-owned’ we mean a business where a meaningful proportion of the company is owned by its employees, whether as individual shareholders or through a trust, or through some combination of the two—where ‘significantly' is generally taken to be at least 25 per cent. The term ‘employee-owned’ or ‘worker-owned’ or ‘worker co-operative’ is typically reserved for a business where the workers own more than 50 per cent of the shares or ownership rights of the business.
This complex set of organizations is termed differently across countries: from ‘mutuals in the UK, to ‘solidarity co-operatives’ in Latin America, to ‘employee-owned’ and ESOPs (Employee Stock Ownership Plans) in the United States. In some countries, such organizations are not even officially recognized and thus lack a specific descriptor. For the sake of clarity, this handbook refers to ‘member-owned organizations’ to encompass the variety of non-investor-owned organizations, and in the national case-study chapters, the terms used will be those most widely employed in that country.
These alternative corporate forms have emerged in a variety of economic sectors in almost all advanced economies—since the time of the Industrial Revolution and the development of capitalism, through to the subsequent creation and dominance of the limited liability company. Until recently, these organizations were generally regarded as a rather marginal component of the economy. However, over the past few years, member-owned organizations have come to be seen, in some countries at least, as rep- resenting a newly attractive potential in light of their ability to tackle various economic and social concerns. The first international organization that explicitly recognized the importance of these organizations was the Labour Conference that in 2002 adopted the International Labour Organization (ILO) Recommendation No. 193 concerning the promotion of co-operatives. The interest in co-operatives grew further as a consequence of their relative resilience during the financial and economic crises of 2007–9.
Thus, 2012 was designated by the United Nations as the ‘Year of the Co-operative’. In addition, various documents have been researched and issued by the European Union Institutions that have pointed to the important potential role that could be played by non-investor-owned enterprises across European societies. These include the Communication of the Commission on the promotion of co-operative societies in Europe, where the Commission argued for a greater focus on this area within the new Member States and candidate countries, where despite extensive reforms the instrument of co-operatives is not fully developed. And the Report on Social Economy discussed by the Committee on Employment and Social Affairs of the European Parliament called on the Commission to take the specific features of the social economy (aims, values, and working methods) into account when devising European policies, and to incorporate the social economy into its policies and strategies. Another important such document, that pointed to the contribution of co-operatives to societal well-being, was that of the ‘“Europe2020” strategy, and this was followed by the European Commission launching their ‘Social Business Initiative’, which developed a similar message.
This renewed interest in member-owned organizations has paved the way for a wider recognition of the importance of corporate diversity in contributing to the health and resilience of national economies, including for example by the 2012 Report delivered by the UK Commission on Ownership, which advocated a greater degree of corporate diversity, with a stronger member-owned and employee-owned sector, and with the UK’s 2010-15 Coalition Government being committed—including in its Coalition Agreement—to strengthening the co-operative and social economy sectors, in part to create a more resilient financial services sector in reaction to the global financial and economic crises of 2007-9, which were generally seen as having been fuelled by the excesses of privately and shareholder-owned banks and other financial institutions.
This handbook is international in scope, includes contributions from the leading academics and practitioners from the relevant fields, and covers the various disciplinary areas—including economics, finance and accounting, management and business, law, politics, history, organizational studies, psychology, public policy, and industrial sociology. The approach of the collection is interdisciplinary. The chapters reflect the latest academic research and thinking on each topic, as well as reporting the relevant policy debates. The strengths and weaknesses of the various alternative corporate forms are explored, with failures analysed as well as successes.
Courtesy by Oxford University Press.