The Challenge

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How might we inspire and enable communities to take more initiative in making their local environments better? read the brief

Contribution

Learning from of Mondragón Corporation - Redesigning Work and Living

Mondragón Corporation is a corporation and federation of worker cooperatives owned by highly participative workers, now 7th largest Spanish Company in Basque Country. Singapore being a small country, community can potentially contribute in big ways.
At Basque region of Spain, Mondragón Corporation is now the 7th largest Spanish company in terms of asset turnover and the leading business group in Basque Country. It provides employment for 83,869 people working in 256 companies in four areas of activity: Finance , Industry, Retail and Knowledge. Co-operatives operate in accordance with a business model based on People and the Sovereignty of Labour, which has made it possible to develop highly participative companies rooted in solidarity, with a strong social dimension but without neglecting business excellence. The Co-operatives are owned by their worker-members and power is based on the principle of one person, one vote.

Business Culture
The ties that link the MONDRAGON Co-operatives are strong, as these bonds emanate from a humanist concept of business, interrelated by a philosophy of participation and solidarity and a shared business culture rooted in a number of Basic Principles, a shared Mission and the acceptance of a set of Corporate Values and General Policies of a business nature.

This entire framework of business culture has been structured on the basis of a common culture derived from the 10 Basic Co-operative Principles, in which MONDRAGON is deeply rooted: Open Admission, Democratic Organisation, the Sovereignty of Labour, Instrumental and Subordinate Nature of Capital, Participatory Management, Payment Solidarity, Inter-cooperation, Social Transformation, Universality and Education.

Wage Regulation

At Mondragon, there are agreed-upon wage ratios between the worker-owners who do executive work and those who work in the field or factory and earn a minimum wage. These ratios range from 3:1 to 9:1 in different cooperatives and average 5:1. That is, the general manager of an average Mondragon cooperative earns 5 times as much as the theoretical minimum wage paid in his/her cooperative. This ratio is in reality smaller because there are few Mondragon worker-owners that earn minimum wages, their jobs being somewhat specialized and classified at higher wage levels.

Although the ratio for each cooperative varies, it is worker-owners within that cooperative who decide through a democratic vote what these ratios should be. Thus, if a general manager of a cooperative has a ratio of 9:1, it is because its worker-owners decided it was a fair ratio to maintain.

Scholars such as Richard D. Wolff, American professor of economics, have hailed the Mondragon set of enterprises, including the good wages it provides for employees, the empowerment of ordinary workers in decision making, and the measure of equality for female workers, as a major success and have cited it as a working model of an alternative to the capitalist mode of production.

Mission #1 Share Success Stories

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