What Does a Cooperative Ecosystem Look Like?

by Mary Ann Kingsley

What does a cooperative ecosystem look like? What I learned from my study tour of the Mondragon cooperative conglomerate in the Basque Region of Spain

Try imagining what a cooperative ecosystem might be like. 

Having troubles? 

Americans may have difficulty envisioning a world where cooperative enterprises play a large role in the economy, our social network, and impact our everyday work lives.

For example, a cooperative ecosystem might be a place where worker-owners vote for their company’s leadership and receive dividends from the company’s profits. Where the average gap between the highest paid person in the company and the lowest paid is only 6:1. Where life-long career development, training and education of workers is frequent and significant. Where giving back to the community is a core value that happens before dividends are shared. And where companies work together for mutual success, with the well-off companies providing support to startups or those having a bad year. 

From June 15 to June 23, 2024, as one in a group of graduate students enrolled in the online master’s program in cooperative management through the International Centre for Cooperative Management (ICCM) at Saint Mary’s University based in Halifax, Nova Scotia, I enjoyed the Basque country, learned about Mondragon cooperatives, exchanged experiences from each other, and found insights we could apply to our own organizations. Led by the host of Mondragon’s executive education co-op, Otalora, Ander Exteberria, and ICCM facilitators, our group was treated to presentations and tours that exhibited both the broad range of cooperative enterprises within the Mondragon conglomerate as well as the strategic choices that shaped the history of the Mondragon experience. 

Here are the basics: Mondragon today employs about 80,000 people in network of 95 cooperatives, and over 150 other entities abroad (i.e. production plants, sales and service entities). Its annual income is 11 billion Euros. Of the cooperatives, 49 of them are industrial worker co-ops, other areas include finance (Spain’s second largest credit union), R&D, educational (including Mondragon University), and services in health, welfare, and mutual insurance. All are worker cooperatives. The largest consumer co-op of the group (actually a multi-stakeholder co-op of workers and consumers) is Eroski, which has almost 1,000 grocery stores in Spain, France, and the UK. Eroski employs about 30,000 workers and 9,500 of these are worker-members. Consumer-members are over 1.3 million. We are talking big.

Our study tour provided critical perspectives from academic experts, knowledgeable outsiders, and internal members that helped us get a view of the challenges the world’s largest worker cooperative faces today and going forward. Here are some key impressions I took home from this experience.

Mondragon’s Foundation Mondragon’s culture is unapologetically ambitious, structured, and guided by a clear set of values and principles. It knows, accepts, and champions what it is, and is transparent about what it is not. This is possible because of its strong foundation in the philosophy, teachings, and actions of Father José Maria Arizmendiarrieta (commonly called Father Arizmendi), a young priest who came to Mondragon in the 40’s when the town of Mondragon was impoverished and socially disrupted by the Spanish Civil War. At that time, the town of Mondragon was known as the site of the largest population killed by noncombatants – those shot by contacts who betrayed their neighbors to the police. The priest and the curate there before Arizmendi came were both shot dead.

In this hostile context, Father Arizmendi developed the cooperative spirit and leaders that founded the Mondragon Cooperative Group. He was a profound visionary of cooperativism, a firm believer in the power of education, and a no-nonsense advocate that beliefs must be put into actions. Mondragon presenters said their cooperatives were guided by his values of human dignity, solidarity, education, and work permeate many aspects of the parent base of Mondragon. If you want to be inspired, read Reflections, a collection of excerpts of Arizmendiarrieta’s writings.

The study in contrast between Mondragon’s soaring development of people’s intellect, solidarity, and spirit, and the hard-nosed, clannish pragmatism of Basque self-reliance and autonomy are what I take back as a fundamental aspect of Mondragon’s cooperative system. One researcher wrote that Arizmendi said “’The economic revolution will be moral or it will not succeed... the moral revolution will be economic or it will not succeed.’ Thus goodwill and intentions are important but they are not enough. Efficient business structures are also a fundamental necessity.” This balance, or equilibrio, is noted by other academics as the first of nine guiding principles of Mondragon: “This linking of social, economic, and technological ideas was important not only in shaping the internal development of each cooperative but in beginning the development of a network of mutually supportive cooperatives” (Whyte & Whyte, 1991).

Be Strong and Smart: Defensive and Offense Strategies

If Mondragon cooperative development were a soccer team (and Spain did win the Euro Cup this summer with nine Basque players on the team), it would show a pattern of play filled with aggressive defensive and offensive strategies. 

Mondragon’s defensive strategies are to develop strong, resilient cooperatives that can withstand adverse conditions. These include, among others: prioritization of local development; creation of its own source of financing and technical assistance; creation of its own social safety net, including employee retention. This toughness and self-reliance were the key to Mondragon’s growth and prosperity. 

Offense strategies make the co-ops nimble and smart. These include innovation, education, transparency, internationalization (this is controversial), and the development of people. I learned these through our readings prior to the trip but while visiting the emphasis on innovation was striking. Innovation and business acumen is prioritized to out-play the competition. Becoming a multinational with non-cooperative member subsidiaries in low-wage countries in the 1980’s in order to compete with multinationals has become a point of contention that led one thoughtful academic we met to coin Mondragon co-ops as “coopitalist multinational hybrids” (Errasti, 2024). But Mondragon leaders are unapologetic (remember that these leaders are voted in by their members). Any thought of a co-op existing just to serve its community, as we often think about with food co-ops, goes out the window here. All co-op startups within Mondragon must show a strong and inventive business strategy. 

Develop Common Purpose through Commitment, Study, and Training

Mondragon works hard to develop a common purpose among its members through its social values, distribution of ownership and wealth, and democratic process. Each worker invests about € 17,000 (varies by co-op) of personal funds to become a co-op member. They receive training in their rights and responsibilities, participate in governance and are expected to share in the responsibility for success. The “why” – why should we do this? – is implicit in the culture and is made explicit through training that clearly shows the benefits of cooperation, solidarity, and social responsibility. This point of common purpose is crucial and they do not take it for granted. 

To really understand this, I would direct you to an excellent series of videos put out by our host, Ander Exteberria, called Explore Mondragon (select English subtitles). Ander is as open, generous, and committed as he looks in these videos and you get a chance to see the beautiful Basque scenery and the diversity of Mondragon enterprises. We were treated to a dinner Ander hosted for us at his social/culinary club. These are actually a tradition in the region – a place to entertain your friends with a professional kitchen where you cook but they hire someone to clean up! Great idea!

Beginning with Father Arizmendi, education holds a central place in Mondragon. States a business expert: “the nature and success of Mondragon is integrally related to its growth and development as an educational system.” Mondragon best practices are to invest in people continuously to ensure that talent and skills be developed in both technical and cooperative areas. 

For co-op start-ups, the Mondragon network provides an ideal combination of technical assistance, investment, and ongoing monitoring to the new enterprise - but lets the new enterprise create the team, the market, and give them 3-5 years to become financially secure. 

Beyond this, Mondragon builds educational centers within its network to ensure continuous learning and, if needed, retraining in technical skills. We visited Mondragon University, spoke to professors there, and met with leaders from LKS, a consulting service that provides worldwide services in cooperative development. The facilities and investment in education and training are impressive indeed!

Take Home Lessons

Despite the obvious differences in scale, cooperative type, and impact, I returned from the Mondragon study tour with several important lessons for our little co-op, Catonsville Cooperative Market. These include:

  1. Create a shared understanding of the “why.” We should be bonded by a common purpose and shared values.

  2. Invest in people as our offensive strategy. We should find good mentors, study together, and create a learning environment that prepares us for carrying out our business strategies and community responsibilities.

  3. Invest in infrastructure as our defensive strategy: without investment and commitment to our goals we won’t be strong enough to overcome hard times and difficulties.

  4. Expansion should be done deliberately to develop long-lasting impact over time. Like Mondragon, we need to carefully create the conditions for lasting, generational success that works in good times and in bad.

My Mondragon study tour brought unforgettable impressions of the Basque country and culture, lasting memories of great conversations with my colleagues and presenters, and a snapshot of a magnificent, resilient cooperative system that withstood global economic crisis and managed growth while maintaining important aspects of democratic representation.

For more information about Mondragon, I recommend these sources:
Balch, O. (2024, April 24) “‘In the US they think we’re communists!’ The 70,000 workers showing the world another way to earn a living. The Guardian. https://www.theguardian.com/lifeandstyle/2024/apr/24/in-the-us-they-think-were-communists-the-70000-workers-showing-the-world-another-way-to-earn-a-living

Explore Mondragon 01: Main Characteristics of the Mondragon Cooperatives

Reflections by Don José Maria Arizmendiarrieta

Romeo, N. (2022, August 27). How Mondragon Became the World’s Largest Co-op. The New Yorker. https://www.newyorker.com/business/currency/how-mondragon-became-the-worlds-largest-co-op

References

Errasti, A. (2024, June 21). The challenge of democratizing the multinational enterprise: The case of the Mondragon cooperatives. Presentation slides.

Morrison, R. (1991). Chapter 7-Social structures: The elaboration of the Mondragón experiment. In We Build the Road as We Travel (pp. 135-166). Gabriola Island, BC: New Society Publishers. 

Whyte, W.F. & Whyte, K.K.. (1991). Chapter 2-The Basques. In Making Mondragon: The Growth and Dynamics of the Worker Cooperative Complex (pp. 9-2). Ithaca, NY: ILR Press/Cornell University.

Weekly Tuesday Market Starting August 27th!

Based on member feedback received earlier this year, we are moving forward with the new weekly Tuesday market schedule starting Tuesday, August 27th. Yes, the market will be open every Tuesday evening from 4:30-8 PM. With this new schedule, we will be able to:

·       Provide members a more convenient schedule to get their weekly shopping done at the co-op

·       Increase opportunities for members to engage with other members of the co-op community

·       Support the financial and social health of the co-op

But we need you, our co-op members, to shop during our new weekly Tuesday schedule, and of course, to volunteer! As an all-volunteer run business, we rely on our members to run the co-op. You can find a new SignUp Genius here to get started. In the first few weeks, it’ll be particularly important to ensure a robust roster of volunteers as we make the shift to a weekly market schedule. Take a look at the SignUp Genius and come volunteer, it’s pretty fun!

A brief explanation of how it will work:

1.      You’ll be able to pick up your Frontier and Foodclub pre-orders at our first weekly market on Tuesday, August 27th. Moving forward, you can expect to pick up your pre-orders every other Tuesday market, with the next days being September 10 and September 24. Don’t worry, we’ll update the co-op calendar so you don’t have to remember!

2.      We’ll also have fresh produce available every other Tuesday on the same day as you pick up your pre-ordered items.

3.      On alternate weeks, starting September 3rd, we will be open again from 4:30-8 PM and have what we’re calling more sturdy produce available. This could include potatoes, onions, garlic, apples, pears, squash, etc.

You've asked for a more regular shopping experience, and here's our chance to grant your wish! But we MUST have volunteers signed up. Please click this link today to sign up for one or more shifts: Volunteer Signups.

We can’t wait to see you every Tuesday evening starting August 27th!

Michele's Granola: A local favorite!

Written by C. Yao

After a New England summer spent chomping on freshly baked granola bars, Michele Tsucalas returned to Maryland and came to a terrible realization: she could not find any decent granola. So, she decided to try to make her own. In 2006, Tsucalas founded Michele’s Granola, based in Timonium. The granola is handmade in small batches from scratch. When you buy Michele’s granola you know it is fresh baked!

Michele’s Granola is something you can feel good about eating! It is 70% organic and uses local ingredients when possible. All granolas are gluten and dairy free, and most are vegan. Tsucalas wants her customers to eat something that is healthy and nutritious, but still tastes good!

Michele’s Granola is also Green! The bakery where the granola is made runs on wind power, certified by Green-e. Green-e is the most rigorous certification of renewable energy! Michele’s also recycles or composts 80% of its production materials and composts 100% of its food waste. The granola’s packaging is 100% recyclable, and the packing peanuts are biodegradable.

If all that goodness isn’t enough, Michele’s Granola also created a foundation called Give One for Good Food. 1% of proceeds from sales goes to organizations supporting a healthier and more equitable food system. Michele’s has donated $200,000 dollars so far, as well as employer-paid volunteer time. In 2017, Michele opened Give One for Good Food to other companies and organizations that want to make a difference.

 Michele’s Granola can be found in both the bulk and dry goods sections of the Co-Op. The Original flavor is in the bulk section, and there are often individual packages of the Almond Butter, Original, and Lemon Pistachio. Michele’s seasonal Pumpkin Spice has been seen on the Co-Op shelves as of late! The pecans with hints of cinnamon will delight your taste buds and make you really appreciate the wonderful season of fall!

The Bulk Brief: Equal Exchange

One of the best things about the Catonsville Co-Op is the bulk section. Members can get as much as they want of rice, oatmeal, lentils, Michelle's Granola, or a variety of other favorites! I wanted to highlight one of my favorite items in the bulk section: Equal Exchange Coffee. 

Equal Exchange started in the 1980s when a group of co-op managers from New England started meeting once a week to discuss how food could be better grown, sold, and bought. Nicaraguan Coffee was the first product Equal Exchange sold in 1986. By 1991, Equal Exchange was selling bins of their coffee beans to co-ops in different roasts and flavors. Today, Equal Exchange is one of the country's largest Co-Ops, with 130 worker-owners. 

Equal Exchange products are Fair Trade Certified, meaning that their products are made according to rigorous social, environmental, and economic standards.  People making Fair Trade Certified goods “work in safe conditions, protect the environment, build sustainable livelihoods, and earn additional money to empower and uplift their communities.”[1]

When you buy Equal Exchange, you are supporting another co-op, as well as Fair Trade Certified farms around the world. In addition to the bulk section, different Equal Exchange products are available through our membership with Frontier Co-Op.[2]

Why I Joined the CO-OP

I had learned about the Catonsville CO-OP a while ago but always was a bit confused about what exactly a co-op meant. Is it a grocery store? Then why is it only open one of two days a week? Do people work there? What does it mean to join?

One Saturday I decided to give the Catonsville CO-OP a try. I instantly fell in love! I realized I could get local goods at one place for an affordable price. I also was impressed with how environmentally friendly the co-op is. I can get all the foods I love while helping the earth! I joined that week as a Worker Equity Member. This meant I would volunteer 15 hours for a significantly reduced membership fee.

Posted on behalf of Christy Y.

Skill Share Festival

Join us for our 3rd Annual Skill Share Festival on Saturday, April 16, Noon – 4 pm at the United Immanuel Church of Christ (1905 Edmondson Ave). Attend workshops on permaculture, composting, beekeeping and fermentation, with mini-sessions on raising chickens, making homemade dog treats and using essential oils. Tickets are $10 for adults and kids are FREE. Learn more, including the workshop schedule, on the Skill Share Festival Facebook page.