From simple employee to worker member: a tailor-made approach to support workers buyouts around the world
7 october 2024
On 18 September 2024, CICOPA organised a Mutual Learning Session (MLS) on the topic of business transfers to employees under the cooperative form, that is, workers buyouts (WBOs).
As business transfers are increasing in number and are gaining more attention worldwide, the session provided an opportunity for CICOPA’s members to discuss their experiences with WBOs and, in particular, the role that federations can play in supporting the transition process. Participants from 15 countries from around the world shared their insights, challenges and success stories.
The session was moderated by Osamu Nakano, from JCWU, Japan.
Four speakers provided different perspectives on workers buyouts in their respective countries:
- Canada: RéseauCOOP, Quebec, presented by Pierre Charrete, Business transfer coordinator and Senior financial advisor
- Italy: Legacoop Veneto, presented by Denis Cagnin, production and Services Sector Manager
- France: CGSCOP, presented by Aurélien Hiraux, Investment Director – Financial Tools Department
- Argentina: FECOOTRA, presented by its president Cristian Horton
The various experiences shared by the speakers revealed the diversity of the existing approaches to WBOs. The scenarios showcased included WBOs initiated by owners seeking to sell their businesses, as well as those stemming from succession issues in family-owned enterprises or enterprises in crisis. Additionally, some examples featured former owners transitioning into the role of worker-members. These success stories included businesses that were transferred to the employees around 30 years ago to WBOs that took place in the past couple of years.
The key success factors identified by the speakers include the existence of a strong legal framework, financial support, and the preparedness of the parties involved. The challenges that can hinder the process include the relative slowness of the WBO process compared to selling a business in a traditional way, and a lack of specific expertise that is needed for a successful transfer. To this end, the role of national federations of cooperatives was found to be instrumental in both spreading awareness and providing administrative and legal advice and financial support to the workers buyers.
The session also revealed that workers buyouts offer significant advantages, including employee ownership, fostering democratic decision-making and solidarity, preventing job loss, and preserving valuable know-how within the enterprise, thus ensuring business continuity.
Our Mutual Learning Session underscored the growing importance of workers buyouts. By sharing their experiences and best practices, participants demonstrated the potential for WBOs to create sustainable, democratically controlled enterprises. As workers buyouts become increasingly common, it is essential to address the challenges, learn from existing approaches and examples, and create a supportive environment for these initiatives.
An in depth report and additional resources are available for members in the private session of the website.