Corporate governance as a key aspect in the failure of worker cooperatives

Basterretxea, Imanol; Cornforth, Chris and Heras-Saizarbitoria, Inaki (2022). Corporate governance as a key aspect in the failure of worker cooperatives. Economic and Industrial Democracy, 43(1) pp. 362–387.



The article analyses governance difficulties at Fagor Electrodomésticos, for decades the world’s largest industrial cooperative, and sheds light on how the cooperative model and governance might have contributed to the firm’s bankruptcy. The case study examines how the cooperative model influenced the speed and quality of decision making. The roles of the main cooperative governing bodies (the General Assembly, Governing Council and Social Council) are evaluated and their limitations to effectively supervise and work with management to make difficult strategic decisions. Several governance improvement measures are proposed in order to help other large cooperatives combine democratic control and economically sound governance.

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  • Item ORO ID
  • 69303
  • Item Type
  • Journal Item
  • ISSN
  • 0143-831X
  • Project Funding Details
  • Funded Project NameProject IDFunding Body
    Not SetGIU-15/08University of the Basque Country
    Grupos de investigación del sistema universitario vascoGIC12/158–IT763/13Basque Autonomous Government
  • Keywords
  • Cooperatives; cooperative degeneration; governance; Mondragon; organisational failure
  • Academic Unit or School
  • Faculty of Business and Law (FBL)
  • Copyright Holders
  • © 2020 The Author(s)
  • Depositing User
  • Chris Cornforth