Fast and spurious: How executives capture governance structures to prevent cooperativization

Abstract

Although workers’ cooperatives are regarded as credible alternatives to private companies to reform capitalism, scholars have only started to document the struggles inherent to cooperativization – the process by which private companies transition to cooperative forms. This article analyses how executives prevent actual cooperativization in practice by shaping and capturing governance structures. Relying on 35 interviews, observations, and focus groups of two private firms having adopted cooperative forms, we document a set of governance practices used by executives to prevent cooperativization: general assembly disempowerment, board neutralization, and executive committee entrenchment. We then explain how these practices interact to form a spiral of democratic governance prevention that generate spurious workers cooperatives. These results contribute to cooperative studies by explaining the role of executives and governance in preventing cooperativization. Our study enlarges the repertoire of worker cooperatives pathologies and offers political and organizational levers to limit the phenomena of cooperativization prevention and executives’ capture of governance structures.