Although all companies (including co-ops) are ‘incorporated’, what we’re talking about here are the huge and damaging multinational corporations that dominate the global economy. It’s becoming more difficult to obtain the things we need from anywhere else. Most mortgages are with corporate financial institutions, and most people get their food, energy, cars, fuel, holidays, entertainment, banking, software, telephony, clothes and almost everything else from giant corporations. But there are alternatives. Capable and committed people are already building a non-corporate sector comprised of the types of organisations outlined below – and we can all help them, by giving them our custom:
Co-ops are businesses / organisations that are owned and controlled by their members. They can be comprised of just the members, or involve other stakeholders such as customers or supporters. They are non-hierarchical, democratic institutions. The ‘Co-op’ is a giant co-operative organisation, but the Co-op Bank is no longer a co-operative, having been bought out by a hedge fund after the crash of 2008. The co-operative sector includes worker co-ops, housing co-ops, retail co-ops, land co-ops, consumer co-ops, community energy schemes, credit unions, wholefood co-ops, the Phone Co-op, and now platform co-ops are being developed to provide an alternative to the ‘sharing’ economy (think Über), which is nothing of the sort.
Mutuals are looser organisations than co-operatives, but they are still member-owned, they pool resources and share risks among members and profit isn’t extracted to pay external shareholders. The best-known example of the mutual model is a building society.
A partnership is a business in which two or more individuals share ownership, and make decisions in a non-hierarchical way. Partnerships are unincorporated (unlike co-ops and mutuals), which means that liability lies with the individuals involved – the partnership itself has no separate identity. There is a legally-binding partnership agreement in which details of how the business will operate and how monies will be shared. There are no external shareholders. GPs often form partnerships.
Employee ownership can involve co-operative, mutual or partnership structure, or it may just mean that the company was set up (or bought out by employees) with all shares held only by employees, not externally. The John Lewis Partnership, which includes Waitrose, is the largest employee-owned company in the UK. The board is elected and there are no external shareholders.
Community-supported agriculture (CSA) is the most popular and successful example of this idea. CSA schemes link up small farmers with local consumers who pay up front for produce from the farms. Consumers then know the name of the person who produces their food. In the US, there are also community-supported fisheries, and a handful of projects have started in the UK. Consumers pay up front for weekly deliveries of fish from small fishing boats to local collection points. Although not part of a CSA, direct sales of food by local, small farms and smallholdings to the public include farmers’ markets, farm shops, pick-your-own and veg box schemes.
Trusts separate legal ownership from economic interest – i.e. they manage assets but don’t distribute profits. Community land trusts are set up by local people to hold local assets such as housing, community buildings, land for growing food etc., and to keep them affordable.
Social enterprises / not-for-profits
Usually set up to tackle a particular problem or fulfil a particular need in the community, there are various ways that social enterprises can incorporate (including some of the other structures outlined on this page, plus community interest companies, community benefit societies or charities). The key is that there are no external shareholders taking profit from the organisation – any surplus is used for the benefit of the community.
Free / open source tech
Free software (well, usually software, but it can be other things too) – free as in no cost, but also free to do what you like with, so you can change it and to pass it on to others. It’s the opposite of ‘closed source’, or proprietary software such as that produced by Microsoft or Apple.
Money / exchange systems other than cryptocurrencies are developing that steer trade towards community businesses and individuals and away from the corporate sector, including collaborative / mutual credit schemes and local / independent currencies.
Unincorporated associations usually set up for mutual benefit / shared interest. Usually governed by a management committee, they don’t distribute profits.
Becoming a sole trader is an easy way to start a business – no incorporation (which means no external shareholders), no requirement to register and file accounts and returns with Companies House, and no need for a constitution. Sole traders can come together – for example in community-supported agriculture schemes that link local people with local small farmers. Sole traders can also form the basis of farmers’ markets and veg box and other food box schemes (but not the bigger ones, some of which are well on the way to corporate status).
Of course one way to avoid the corporate sector is to provide things for ourselves. This probably isn’t going to involve laptops or TVs (yet – let’s see what 3-D printing will deliver), but it’s very possible to provide our own food, craft or bodycare products, clothes and textiles, or even housing and energy with the right skills.
And finally, an important question is whether we need all the stuff we’re told we need in the first place. Can we do without it, or obtain it by sharing with others?