Mondragon Corporation, the world’s largest industrial worker cooperative, has been lauded for its resilience during Spain’s economic crisis and its unique governance structure. Yet, critics argue that it falls short in its democratic ethos. Despite its worker-ownership model, Mondragon’s workers aren’t always decision-makers. Only 60% of the workforce are member-owners, while the rest are salaried staff without voting rights.
Additionally, Mondragon’s growth strategy involves creating subsidiaries in low-wage countries, leading to accusations of exploiting cheap labour. This strategy contradicts the cooperative’s commitment to social responsibility and equality. Furthermore, the corporation’s response to the 2013 bankruptcy of one of its largest cooperatives, Fagor, raised questions about its solidarity principle. Rather than bailing out Fagor, Mondragon allowed it to fail, affecting 2,000 jobs.
Despite these criticisms, Mondragon’s model offers valuable lessons for worker cooperatives. Its success lies in its ability to scale, and its commitment to education, training, and innovation. It also underscores the importance of inter-cooperative solidarity and the need for external growth strategies. However, to truly embody its cooperative principles, Mondragon must address the democratic deficit within its ranks and ensure its growth does not compromise its values.
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