What if the economic model that could finally get us out of capitalism has already existed all over the world for nearly two centuries? I’m talking, of course, about cooperatives.

No predatory shareholders, no untouchable boss. Anyone who joins the structure becomes a co-owner. Every participant has a voice. The board of directors is elected, can be removed, and answers to the general assembly. The executive carries out a collective will; he doesn’t dictate it.

And this model works! With 3 million cooperatives worldwide and 1 billion members, present in every sector: agriculture, banking, healthcare, industry, media… It produces structures that hold up better in crises, lay off fewer workers, and offer genuinely good working conditions.

The History of Cooperatives: From Working-Class Origins to a Global Model

The history of cooperatives begins in misery. In 1844, in Rochdale, England, 28 weavers on the verge of bankruptcy decided to pool their meager savings and open a collective store. No boss, no shareholders. Every member contributes and every member decides. Without suspecting that their model would be replicated all over the world, they had just laid the foundations of modern cooperative societies.

This initiative didn’t stay isolated, because it was emerging everywhere in the ferment of the 19th-century labor movement. A time when the struggles for self-management and the mutualism theorized by Proudhon were enormously popular. The cooperative wasn’t a concession wrung from capitalism through violence. It was more like a response quietly built from below by people who had nothing left to lose and decided to organize differently, without asking anyone’s permission.

In the 20th century, the model spread and diversified. In 1956, in the Spanish Basque Country, the priest José María Arizmendiarrieta founded the first cooperative of what would become Mondragón, today one of the world’s largest cooperative groups with more than 80,000 members. In Scandinavia, agricultural and banking cooperatives became pillars of the national economy. Meanwhile, in Africa, Asia, and Latin America, millions of farmers and craftspeople adopted this model to survive and grow outside the grip of multinationals.

Today, the International Cooperative Alliance brings together organizations from more than 100 countries. The cooperative is not some activist curiosity. It’s a global, battle-tested economic model that has survived two centuries of crises without betraying its founding principles.

How Does a Cooperative Work? Governance, Democracy, and Shared Power

In a conventional company, power follows money. Whoever holds the most shares calls the shots. In a cooperative, it’s exactly the opposite, because power follows people. One vote per member, whether you put in 500 euros or 50,000 euros of capital. That’s the founding principle, and it changes everything.

The governance structure is simple in principle: members elect a board of directors from among themselves. That board sets the strategic direction and appoints an executive director responsible for implementing it. The director answers to the board, which in turn answers to the general assembly of members. The chain of power always runs back up to the collective, never to an outside shareholder.

The general assembly is the sovereign body. It’s where the major decisions get voted on: profit distribution, strategic direction, amendments to the bylaws. Every member participates with equal weight, regardless of seniority or financial contribution. Leaders are accountable. They can even be removed without any drama.

This democratic system mechanically eliminates certain well-known pathologies of the capitalist firm: the manager hired through cronyism, the board completely out of touch with reality on the ground, the executive who awards himself an obscene salary while cutting jobs… In a cooperative, those decisions have to go in front of everyone. Sure, this collective filter doesn’t guarantee perfection, but it at least makes abuses structurally far more difficult to pull off.

What Sectors Can Adopt the Cooperative Model?

This is often the first objection: the cooperative model is fine, but only for small structures, local craft businesses, or the corner grocery store. But the reality is entirely different, because there isn’t a single economic sector where cooperatives haven’t already proven themselves, even at scale.

Agriculture has historically been the most fertile ground. Millions of producers worldwide have grouped together in cooperatives to stand up to large distributors, share equipment, and negotiate collectively. In Kenya, India, and Brazil, these structures have pulled entire communities out of dependence on predatory middlemen.

What about heavy industry? Mondragón, in the Basque Country, has been answering that question for 70 years, for everyone who claims the model can’t hold up at scale. With more than 80,000 members and activities ranging from machine-tool manufacturing to retail distribution, plus research and higher education, this is flat-out a multinational in cooperative form.

Banking and finance are no exception either. Credit unions, present in more than 100 countries, collectively manage their members’ savings and credit without seeking to maximize profits for outside shareholders. In Sweden, the JAK bank operates without interest, and Triodos finances exclusively projects with a positive social and environmental impact.

Healthcare, housing, energy, media, technology, legal services… Everywhere humans have economic activity, cooperatives have shown they can establish themselves as an alternative and thrive. The question is no longer whether the model is applicable. The question is why it isn’t already the norm.

Cooperatives vs. Conventional Businesses: Performance and Resilience

Cooperatives are often seen as a likable but fragile model, doomed to stay marginal in the face of capitalist giants. Except that the numbers tell a radically different story.

During the 2008 financial crisis, for example, cooperative banks held up significantly better than their conventional competitors. While the big private banks were being bailed out by governments or collapsing altogether, credit unions and cooperative banks kept operating. That’s what allowed them to protect their members’ savings and continue financing the local economy. Not by some miracle, but because their model doesn’t push them to take reckless financial risks in order to maximize the quarterly returns of anonymous shareholders.

In recessions, cooperatives lay off significantly fewer people than conventional companies. While a traditional company goes straight for the chopping block to protect margins, a cooperative looks for other solutions first: temporary pay cuts, work-sharing, or other forms of internal reorganization. And it’s not hard to see why. Members don’t casually fire themselves without accounting for the human wreckage that creates.

And the economic performance numbers are just as real. A University of Bologna study on Italian cooperatives shows a five-year survival rate well above that of conventional companies in the same sectors. In France, Quebec, and the United Kingdom, the data all points the same way: cooperatives last longer, weather crises better, and maintain productivity levels comparable to their competitors.

The reason is structural. In a cooperative, the interests of workers and the interests of the organization are aligned. Nobody has an incentive to sink the ship just to extract maximum value before bailing out with a golden parachute.

What Does the Social Model of Cooperatives Look Like?

In a cooperative, economic democracy doesn’t stop at the doors of the general assembly. It runs straight through the day-to-day reality of work. And it’s on this front that the cooperative model produces its most concrete, most visible, most human effects.

The toxic manager, the petty tyrant who feeds on humiliation, the untouchable superior because he’s buddies with the boss… All those very familiar horrors of the conventional workplace run into a major structural obstacle when it comes to pulling their usual tricks: they have to answer to colleagues who have exactly the same say in governance as they do. Abuse of power isn’t impossible, but it’s much harder to sustain over time because the collective has the means to shut it down quickly.

Working conditions reflect this reality. Cooperatives consistently show higher job satisfaction levels than conventional companies. This comes largely from family-friendly arrangements, flexible hours, generous parental leave, and a real effort to work around people’s personal lives. This is neither disconnected idealism nor philanthropy that costs money. It’s simply because the members themselves vote on these provisions, and they have every interest in keeping their living conditions decent enough to stay productive. Unlike the capitalist system, which will never grasp that you can’t get the best out of people by keeping them permanently under pressure and on the edge of insecurity.

Pay distribution is also more balanced. At Mondragón, for instance, the gap between the lowest and highest salary is statutorily capped. No CEO awarding himself 300 times a worker’s salary while announcing layoffs. Sure, internal inequalities exist, but they’re framed, debated, and voted on.

Working in a cooperative doesn’t mean working for someone who seized the land or the tools of production. It means collaborating with people who decided to pool their resources to build a company that actually means something. And the first thing it means is being in service of the human being, both on the company side and on the customer side.

Companies That Converted to Cooperatives: When Firing the Boss Changes Everything

This is not theory. In hundreds of documented cases around the world, conventional companies have shifted to the cooperative model. Sometimes out of conviction, often out of necessity, but always with results worth taking a close look at.

The most common scenario is a company in trouble, a boss who disappears overnight or gets pushed out, and workers who refuse to let their workplace die and collectively buy the structure back. In France, this mechanism is called a SCOP de transformation. In the United Kingdom, the United States, and Argentina, similar mechanisms exist under different names. The principle is the same everywhere: workers taking back control.

The results are striking. A study on cooperative conversions in the United Kingdom clearly demonstrates a return to profitability in the majority of cases within three years of conversion. In the United States, industrial companies written off as dead have been relaunched in cooperative form with productivity levels exceeding their previous record.

In Argentina, after the 2001 crisis, hundreds of factories abandoned by their owners were taken over by their workers and converted into cooperatives. Some are still running today, twenty years later, in sectors as varied as printing, metalworking, and healthcare.

The message is therefore very simple: the boss and the shareholders were not an indispensable cog in the machine, as the system wants us to believe. In reality, they were an obstacle to the prosperity and longevity of the company. So once you get rid of those parasites, it starts working again in the general interest.

Staying Vigilant to Avoid Corrupting the Cooperative Model

Without vigilance about its possible drift, the cooperative model is not a universal cure-all. Idealizing it blindly would therefore be just as dishonest as rejecting it wholesale. Take the case of Mondragón, precisely because it’s the biggest.

Mondragón remains undeniably a major success: average salaries above those in conventional companies, solidarity mechanisms between cooperatives in times of crisis, and genuine internal democracy at the local level. But as the group grew and went international, cracks appeared. Today, only a third of the 74,000 people who work for the group are actually members of the cooperative. The rest are temporary employees in Spain or workers in foreign subsidiaries in China, Mexico, or Turkey, all of them without rights or benefits equivalent to those of the full members.

The picture is therefore less glamorous than it appears. It’s somewhat reminiscent of Athenian democracy, which we happily idealize in school textbooks: citizens with full rights, a sovereign assembly, active participation in public life. But alongside all that, a majority of slaves that people tend to forget about. Which is a much harder sell.

On top of that, through the process of internationalization, internal salary gaps have grown considerably. Some executives in the group’s larger entities now receive compensation that has nothing to do with the founding principles. It’s always the same old capitalist poison seeping back in: the great-man theory, the indispensable executive who deserves a king’s ransom because he’s got the right charisma and the right diploma on the wall. In some of the largest subsidiaries, the pay ratio can reach 9 to 1. While in most of the group’s cooperatives, the ratio between the highest and lowest pay stays between 3 and 6 to 1. This is, of course, nowhere near the 300-to-1 ratios that are commonplace in conventional multinationals. We can all agree on that. But it’s still a real drift away from the founding principles, and it’s a reason to stay vigilant.

On top of that, unions are not permitted at Mondragón on the grounds that the cooperative members are themselves employers. An argument that holds for the members, obviously, but that leaves the thousands of non-member employees without recourse. And that, too, brings us straight back to ancient Greece and its democracy that wasn’t for everyone.

The lesson is therefore clear: unchecked growth is the natural enemy of cooperative democracy. Because the bigger a structure gets, the more the real participation of members tends to erode, and the stronger the temptation to reproduce classic managerial patterns. But that is absolutely not a reason to reject the model. It’s above all an invitation to stay vigilant, and also a golden opportunity to remind ourselves that democracy is not a done deal but a living thing. And from an economic standpoint, it means we need to be done once and for all with the absurdity of growth for growth’s sake. Because let’s be clear: no, trees cannot grow to the sky!

Fake Cooperatives: When Finance Hijacks the Label

The success of the cooperative model has produced a predictable perverse effect: conventional capitalist structures with no shortage of cynicism have hijacked it for marketing purposes. The result is that the word “mutual” or “cooperative” is now slapped onto organizations that no longer respect a single founding principle.

The insurance and banking sector is the prime hunting ground for these imposters. Financial groups worth tens of billions of euros present themselves as mutual societies serving their members, plastering their ads with solidarity and proximity values. Except that behind this smokescreen they run their business exactly like any other finance shark. Disconnected boards of directors, executives with obscene pay packages, general assemblies turned into social events where the participation rate of small members hovers near absolute zero, and strategic decisions made far from any real democracy.

The mechanism of degeneration is well documented. An authentic cooperative or mutual society grows, professionalizes its management, and attracts executives from the conventional private sector who import their reflexes and their value systems along with them. Gradually, the internal culture shifts… Members are no longer sovereign partners, they become customers to be retained. The general assembly is no longer a place of power. It’s just a cozy gathering where people sip champagne and nibble canapés while congratulating themselves on the year’s juicy profits.

Yet the difference from a genuine cooperative is straightforward to identify: Who really makes the decisions? Who sets the executives’ salaries? What’s the participation rate at general assemblies? Are profits redistributed to members or reinvested in the group’s growth? The answers to those four questions are usually enough to strip off the mask.

The cooperative label is therefore not a guarantee. It’s a promise that must be continuously verified and defended by those who are supposedly its owners.

Toward a Global Cooperative Economy: Utopia or Real Alternative?

The question is no longer whether the cooperative model is viable. It has proven that it is. Three million cooperatives, one billion members, present in every sector and on every continent for two centuries. That debate is over!

The real question lies elsewhere: why does this model remain marginal in the face of a capitalism that produces record inequality, repeated crises, and ecological destruction that no longer needs proving? The answer is political, not economic. Because capitalism doesn’t dominate through its efficiency. It dominates solely because it controls states, legislation, access to credit, and the mainstream media. The cooperative, on the other hand, benefits from none of those levers. It therefore has to fight on an uneven playing field, within a legal and financial framework designed for and by its adversaries.

Yet the positive signals are piling up. Cities like Preston in the United Kingdom have made local cooperative economics a central axis of their development policy, with measurable results on employment and inequality. In Quebec, the solidarity cooperative movement is experimenting with hybrid models that bring together workers, users, and the community within a single governance structure. In the tech sector, cooperative platforms are emerging as a direct alternative to Big Tech, delivering the same services without extracting value for invisible shareholders.

For its survival, capitalism needs to convince us that nothing else is possible. Yet cooperatives prove the opposite every single day, in bakeries, banks, factories, media outlets, and medical practices. Not in some hypothetical future. But right now, everywhere, with ordinary people who decided to stop waiting for the system to reform itself.

Conclusion: What Anarchism Actually Has to Say About Economics

It’s high time to set the record straight! The word anarchism has been so thoroughly smeared, caricatured, and weaponized that most people no longer see anything behind it but rioters and slightly unhinged idealists. The system has done its dirty work well! Yet Orwell called out this manipulation long ago by explaining that whoever controls language controls thought.

So here’s the truth: real anarchism, the kind that belongs to the great intellectuals who shaped the history of political and artistic thought, is not chaos. It’s exactly the opposite! Because anarchism in practice means concrete alternatives. Alternatives that work, that last, and that give everyone a good life. Proof: the cooperative form of collaboration is embraced by everyone who actually practices it.

If you’re still doubtful, look into Spain in 1936 with the CNT. When workers took control of 3,000 companies across every sector and turned them into a common good, their daily lives improved dramatically. This isn’t communism in the political sense of the word. Absolutely not! It’s simply applied anarchism that worked, giving citizens their full place by kicking out all those destructive financial predators. But that’s a long subject that deserves its own detailed treatment in future articles.

In the meantime, we’re going to keep dismantling capitalism brick by brick. And we’re going to keep pushing anarchism forward brick by brick. And among those first bricks, cooperatives hold a very important place.

But the media, almost all of them sold to capitalism, are not going to spread this kind of idea in a positive light. In this story, there’s only you and me. That’s already two of us 🙂 And with us on board, it’s already better. It’s a good start. Don’t you think?

So thanks for taking a few seconds to share this article. You can even republish it or print it out, it’s pure copyleft. Because the more of us there are pushing these ideas forward, the more they can finally carry weight in the public debate. Which will help us get out together from this modern slavery that is wage labor, the kind that leaves us just enough to pay bills that keep getting heavier. And on top of that, we’re forced to watch our planet degrade day after day for lack of a credible alternative to capitalism. So spread the word about NovaFuture, and see you soon for more explorations of economic alternatives.