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Sustainable Businesses, Employee Ownership & Cooperatives
Both MBC Ventures and Frida Inc. have been prime examples on how to achieve sustainability. By employing local people and empowering employees, the local economy can thrive off the retained employees who care about their community. Sustainability can stand for all aspects of the business and its environment. Deborah Olson is also working with Möbel Link™ Furniture, a Detroit based company making award-winning furniture from plywood using a sustainable process (see photo on right). When sales are sufficient, Möbel Link™, located in Detroit's Russell Industrial Center, intends to manufacture by creating an employee-owned company of local Detroiters.What does “Sustainable Business” mean? “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (Source: United Nations’ Brundtland Commission in 1987.) Businesses adopting these practices are called “triple bottom line” either in reference to the “Three P’s” of “people, planet and profit”. Or to the “Three E’s” of “environment, economics and equity”.“Green America” is dedicated to harnessing the economic power of consumers, investors and businesses to promote social justice and environmental sustainability. See details for their Green Business Certification.
Worker ownership helps businesses achieve sustainability because:
It employs local people
Benefits the local economy
Local owners are more likely to protect the local environment
Empowered employees use their brains and energy to help the company save money by reducing waste and improving reuse
Employee owned companies have a track record of paying better wages and benefits while improving sales, decreasing employee turnover and retaining jobs in economically hard times.
Employee Ownership & Cooperatives Play an Integral Role
A business whose owners live in a local community are much more likely to create and retain good local jobs, protect the local environment and support efforts to meet community needs. Owners who share equity ownership with their employees, and people who join together to create a business or co-op, are demonstrating a tangible concern for their workers and community. Participative employee owned companies get the greatest business benefits from employee ownership.
Employee owned companies generally provide better benefits and have better sales growth and sales per employee. They also increase employment more than comparable companies and are more likely to stay in business longer.
Employee owned companies average twice the rate of capital investment over comparable companies. Not only are they far more likely to survive during hard economic times , but they are also slow to outsource work. Employee owned companies are 3-4 times less likely to lay off workers.
Employee owners don’t lay themselves off, they innovate new products. For example, EBO, an Ohio company tripled its business in 5 years when it engaged all its employees in product development and expanded its mining equipment line to include recycling equipment and medical devices. http://www.ebogroupinc.com/Info/EBO-History
Social and Economic Impact by Collaborating Groups of Cooperative Businesses
There is preliminary (not conclusive) evidence that those living in a community with a large percentage of worker cooperatives are healthier, better educated, have less crime, and have more social participation than people in a comparable town with fewer cooperatives.
Communities with major cooperative business groups, such as Mondragon and Emilia Romagna, in Italy, have been much more successful in fostering successful start-up businesses than we have in the US. For the Saiolan Start-up Center at Mondragon University (which started in the 1980’s), 89% of its start-ups are still in business 5 years later, and 83% 10 years later. In the US 1 out of 5 start-ups is alive in 5 years.
The Community Economy Group which includes the Center for Community Based Enterprise and IngenuityUS, L3C is working to build such a cooperative community of businesses, churches and community organizations in Southeast Michigan.
