The only way is ethics: new pioneers giving power back to the people

You don’t have to be political to see that shareholder capitalism is unbalanced. Sean Smith speaks to members of modern co-operatives insisting on fair working conditions and meaningful employment

Co-ops seem entirely consistent and coherent in a pandemic and are more likely to survive (Getty)

Chris Newton is a very amiable anarchist but can’t quite remember the precise moment of his conversion; he thinks it may have been on the road to Preston where he worked in a call centre and spent the daily commute pumped up on Rage Against the Machine CDs.

Or it may have been that time he was working in a branch of a well-known high street health shop and a company director tried to galvanise the staff with this motivational gem: “I don’t care if there’s shit on the floor as long as there’s money in the bank.” Newton has been a proud member-owner of Single Step for 13 years. It’s the radical vegetarian worker co-operative he chanced upon in Lancaster when he went looking for a cleaner shop floor.

Inspired by the radicalism of the Rochdale pioneers of 1844, a new generation of idealists no longer wants to work for remote shareholders. When the Rochdale tradesmen pooled their meagre resources to stock a store with basic goods they couldn’t have otherwise afforded, they didn’t know they were founding a mass movement that today is worth £38bn to the UK economy. The modern co-op movement is clearly a very broad church indeed, inspiring passion in anarchists like Newton and small-state Conservative MPs like ERG chief Steve Baker.

Like Newton, Dan and Finn are part of a new wave of worker co-operatives who regard their jobs as a “vocation” but it hasn’t always been that way. Dan Monks is one of the 70 member-owners of Unicorn, an award-winning worker-owned grocery co-operative in Chorlton, Manchester. She describes herself as “strong-minded” and not particularly political but admits that she was less than a model employee when she worked in the corporate world. Monks “hated the subservience” and admits to taking pleasure in doing jobs badly when she didn’t agree with the organisation’s overall aims.

Finn Lewis became an ardent “co-operator” and open source web designer after an unfulfilling stint at IBM, where he felt increasingly alienated by the “lack of openness and transparency”. Lewis thinks working in the corporate sector means having to carry out decisions made by distant managers desperate to appease shareholders profiting from the hard work of employees they’ll never meet.

Lewis doesn’t regard himself as particularly political either. He just thinks that shareholder capitalism has become our economy’s default operating system by stealth and feels that the education system could do much more to help young people realise that other business models are available.

The co-operative business model left behind by the Rochdale pioneers has quite a legacy. Today, there are 7,063 independent co-ops in the UK, employing nearly 242,000 people. But the modern co-operative movement’s membership values still bear the radical ring of their forefathers: self-help, self-responsibility, democracy, equality, equity and solidarity.

If you serve a successful probation period and become part of a small worker co-operative the chances are you’ll be working very hard in a variety of roles. Soon you’ll get to make key decisions about the strategic direction of the business. Worker-members in smaller co-ops are usually part of a flat management structure, enjoy equal voting rights and the novel experience of not having a boss to blame – as the realisation slowly dawns that now you are one of the bosses. But before you get on a power trip you may want to check the staff rota because it might be your turn to clean the toilets!

Only 42 per cent of new small businesses survive the first five years but for worker co-ops that figure is a much more robust 76 per cent and that disparity widens during economic downturns. Historically, the co-operative movement has been associated with socialism but increasingly, it seem to be drawing support from across the political spectrum. It’s only when you dig a little deeper that you begin to understand just how broad a church the modern co-op movement really is.

Newton has built close relationships with his loyal vegetarian customers at Single Step but they still struggle with the concept of his activist anarchism. He laughs when he recalls their confusion when they turned up at his radical vegetarian workers’ co-operative in locked-down Lancaster only to find a strict one-way system and social distancing markings. He had to remind them anarchy isn’t about chaos and pandemonium; it’s about order or “rules without rulers”. It also explains why Chris is also such a committed supporter of the co-operative movement, where flat management structures and democratic decision-making are enshrined as founding principles.

Single Step specialises in selling loose wholefoods with a low environmental impact and has put ethical consumerism at the centre of its website manifesto: “We believe that in a consumerist society, global and social change begins with what we put in our shopping baskets.” The co-operative model’s emphasis on community building is also attractive to grassroot activist anarchists trying to change the world one street at a time. Newton explains how the name Single Step was derived from a proverb by the ancient Chinese philosopher Laozi : “A journey of a thousand miles begins with a single step.”

Newton believes that every purchase is a political act. He even sources his mobile phone contract from a co-operative supplier and gives a self-deprecating belly laugh when the line fails and I have to call him back on the shop’s landline to complete the interview.

Single Step leans heavily on the support of other co-operatives in maintaining an ethical supply chain. Ethical Consumer is an influential worker co-operative based in nearby Manchester. Using a corporate research database they’ve developed a real-time ethical rating system to keep up with ever changing ownership. Big business is constantly trying to muscle in on the lucrative “ethical market” and Newton explains that if you’re not vigilant you’ll invariably find that a popular line has been snaffled by a corporate conglomerate. Without a subscription to the Ethical Consumer magazine and website Newton is convinced that Single Step would soon be supporting the supply chains that are doing such irreparable harm to the environment.

The Rochdale pioneers would be proud of the way Manchester still seems to influence modern co-operators. Lewis first became aware of the movement when he was a student there and was drawn to the business model when it came to forming his first tech start-up after that unfulfilling stint at IBM.

Only 42 per cent of new small businesses survive the first five years but for worker co-ops that figure is a much more robust 76 per cent and that disparity widens during economic downturns

Lewis is a founder member of the Agile Collective, an Oxford-based worker-owned agency that designs, builds and supports websites “but only for organisations we believe in”. Their mission statement is clear: they want to change the world. “We work with organisations that value environmental sustainability, social responsibility, equality and human rights and share our vision of a better world for everyone.”

The Agile Collective tends to work with NGOs, nonprofits, public service mutuals and educational settings that want to have “a big positive impact”, but will sometimes work with commercial organisations who are doing work that is “demonstrably good”.

Lewis doesn’t miss the corporate mantra of expansion and growth at all costs. Worker co-operatives tend not to grow beyond their natural optimal size, which frees them up to concentrate on the kind of work they actually want to do.

Like Newton, Lewis is also passionate about the Co-op’s Principle Six, which aims to strengthen the movement by forming networking structures. In 2015, the Agile Collective was a founding member of CoTech, a consortium of like-minded tech co-operatives dedicated to an ethical business model. It has since grown to 45 firms with 207 staff and a turnover of over £10m.

He’s not surprised that co-operatives have a better survival rate in their formative years and seem more resilient in hard times. Workers in co-operatives don’t mind tightening their belts and reducing their salaries equally to save jobs because they know that the pain is distributed fairly. That’s rarely the case in opaque corporate structures where redundancies appease shareholders and protect the bottom line.

Back at Unicorn in Chorlton, Monks also thinks co-ops are more resilient. Founded in 1996, the ethical grocer has thrived, growing to over 70 member owners as ecological concerns have risen. There’s an increased awareness that “the food system is fragile, precious and finite”. She thinks worker co-ops enjoy greater loyalty because their customers understand that they’re not out “to make a quick buck”.

Monks loves working at Unicorn. She describes it as “a way of life” that’s “challenging” but always inspires “loyalty and dedication”. She loves the variety the role requires. One minute you’ll be involved in discussions on “strategic direction, the next cleaning the toilets”. Although aspects of the job can be “repetitive and boring”, it’s never alienating because of the pride of being part of something that transcends your sense of self. Like Newton and Lewis she’s also inspired by the Rochdale pioneers and feels that she’s a small part of a historical story as “custodians of the business”.

Unicorn is a model of how small co-operatives can grow into thriving businesses but with that success comes the challenge of retaining truly democratic decision-making. Like the Agile Collective, Unicorn has used the Dutch management model Sociocracy to try to ensure that day-to-day decisions are devolved to the teams of people best placed to make them.

When large AGMs were possible they tended to run long because of the co-operative’s insistence on decision-making by consensus. It’s a model that requires you to become a good listener and meetings have to have an agreed time limit or they could go on forever. But she’s been surprised about how often her views have been “swayed” by colleagues who see key issues differently and thinks it works best when complex issues aren’t reduced to simplistic “binary clashes”.

The large staff body has a wide range of views but Monks thinks most are not overtly political; they just love being part of something they can shape and believe in. She takes comfort from the fact that even if she sometimes falls short of being the virtuous person she’d like to be, she’s covered by working in an organisation that is at least trying to do the right thing. Every year the worker-members dedicate 5 per cent of their salaries to good causes.

Before the pandemic it would have been easier to dismiss worker co-operatives as rearguard radicalism, but not now. James Wright is head of policy at Co-operatives UK; he reminds me of the significance of the statistic that 76 per cent of worker co-operatives survive to maturity while only 42 per cent of small business will still be trading after five years. In terms of both job creation and retention a report by the organisation thinks worker co-ops are a better bet than when it comes to “levelling up” the north and “building back better”.

Wright admires the Department for Work and Pensions’ support for the new enterprise allowance scheme, which helps out-of-work claimants get into small business start-ups and is lobbying central government hard for a similar co-operative enterprise allowance initiative.

He admits it’s not easy because historically Conservatives have a “cultural disinclination” to engage with a movement that shares its socialist roots with the Labour Party. However, Wright thinks that is beginning to change because co-operatives also chime with the core Conservative values of autonomous self-help, and thrift.

Most people in the co-operative movement are not affiliated to any political movement. And Monks doesn’t understand why she and her colleagues are sometimes regarded as “earnest hippies”. Perhaps it’s because we live in an era when working for a democratic organisation that treats its employees, customers and suppliers well, it’s so rare it’s seen as eccentric; it seems sad that insisting on fair working conditions and meaningful employment is perceived as a radical political act.

But you don’t have to be particularly political to see there is something unsustainable about the inequalities fostered by our economic model. You don’t have to be political to see our economic model is unbalanced and extracts wealth from the poorly paid “left behind” communities by shepherding it towards shareholders. It does feel like an unsustainable pyramid scheme that’s hierarchically hollowing out its foundations.

So it seems odd that people like Monks, Newton and Lewis are sometimes accused of being utopian idealists when they’re running successful, sustainable businesses. In fact, in an unsustainable economic model, it’s their position that seems entirely consistent and coherent. Just like the Rochdale pioneers, they’re trying to take back economic and ethical control from a system that seems intent on taking it away.