Mondragón Co-Operatives

The official name of this world famous co-operative group now is the Mondragón: Humanity at Work, and its extensive website details its structure and operations: http://www.mondragon-corporation.com/ENG.aspx. It is the most successful and largest labour-owned and labour-managed co-operative group in the world, currently employing nearly 84,000 worker-owners in over 200 co-operatives in Spain and in 18 other countries.

These co-operatives are a mould-breaking exemplar of participatory management within capitalist enterprises. Composed principally of member-owners who work at and co-manage their own co-operatives within the larger collective structure, they are membership organizations. All members join by paying the equivalent of a year's salary into an account to their co-operative. That account remains theirs and rises and falls according to the business results of their organization, thus giving them a direct stake in the organization's success. All members have a voice and vote in the management of their own co-operative and in the general assembly of the co-operative system as a whole. They are consulted about the annual business plan and vote on it, including the relative allocation of profits between investment in the future development of the co-operative and distribution in terms of salary. The co-operatives have a narrow salary range, the lowest salaries being set at a level comparable to decent entry wages within the region and the highest salaries restricted to between 9 and 12 times the amount of the lowest salaries.

They are divided into a set of central service cooperatives including a health-care system, a retirement system, a co-operative bank and central financial and human resource services. They are further divided into sectors: consumer goods, industrial production goods, retailing, finance, research and development and education.

The co-operatives were founded in 1957 by a small group of students led and taught by a local Catholic priest, José María Arizmendiarreta. This took place in the depths of the isolation and recession that followed Franco's imposition of a fascist dictatorship on Spain and the systematic punishment the fascists inflicted on the Basque Country, among other regions of Spain that had tried to preserve the Republic.

Mondragón itself was a small industrial town almost completely abandoned by its upper middle and upper classes because of the amount of labour strife and social tension existing within it. There was little employment, and in the few factories that were operating, the working conditions and salaries were poor.

Arizmendiarreta had been given responsibility in the parish for youth education, and he gradually tutored a group of students up through completing a university engineering degree, a significant accomplishment since the public Basque universities had been closed by the fascists and the students had to go to take their university examinations in another region.

When this group of young men found that their engineering competence and the San Simonian principles of collaborative work could not be respected in the [Page 543]existing workplaces in Mondragón, the priest helped them create the first manufacturing co-operative and, soon after, others, then a co-operative bank, health-care system and pension system. This effort grew quickly to become a major manufacturing force in Europe with an annual doubling and tripling of the workforce. Those without resources could combine education and work, working part of the day to finance their education during the rest of the day. The early education efforts resulted in the founding of co-operative schools and, much more recently, the founding of a co-operative university with four campuses and over 4,000 students.

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