I have worked in nonprofits for my entire career. Most have been progressive organizations aiming to make a positive difference in the world. Many were fraught with problems, often due to a lack of alignment between external social change work and internal power dynamics. In some cases, workers’ voices and needs were ignored or treated as less essential than the community’s voice and need. This sometimes went as far as expecting that staff martyr themselves in service to the mission. But the staff who do program and administrative work are also stakeholders along with the board, the executive director, and the community.
A push for changing nonprofit practice is gaining momentum. Some of this push is coming from younger staff expressing their desire for greater voice and power. Some is from new leaders of color stepping into executive roles and wanting organizations to be more inclusive and empowering for all staff. Some is from leaders who recognize that an engaged and empowered workforce increases the impact of the work. I have seen all these forces active in the organization where I work. I also hear of them from my colleagues in the field. What stands out to me is the gap between the desire for new ways of working and the skills and practical tools to do it.
Absent sector-wide practices, some nonprofits are turning to systems that aim to flatten workplace hierarchy entirely, or ratings systems that help assess organizational health. One model often overlooked—the worker-owned cooperative—offers the benefit of having grappled with questions of participation, management, and control for decades. And I believe nonprofits can learn from this experience.
Worker cooperatives are businesses owned and controlled by the people who work in them. Workers serve on the board of directors and wear their “owner hat” while doing so. Workers also serve in management, wearing their “management hat” when doing that. In larger worker cooperatives, the organizational chart may look a lot like a conventional corporation. However, managers are beholden to the board, itself composed of worker-owners.
In smaller cooperatives, often operating as collectives, worker-owners organize management committees to carry out operational tasks, which report to the entire group. In short, workers, board members, and managers are aligned because they are one and the same.
Can worker cooperative tools be used to create and reinforce similar alignment among the disparate stakeholders in a nonprofit setting?
Since I have worked with both worker-owned cooperatives and nonprofits, I believe I am well positioned to address this question. And I do believe some worker co-op practices might apply in nonprofits, improving both the workplace and their work.
I currently serve as director of education and training at the Democracy at Work Institute (DAWI), a national nonprofit focused on expanding the worker cooperative model to meet the needs of workers locked out of good jobs and ownership opportunities—particularly BIPOC, immigrant, and low-wage workers. DAWI, which is seven years old and has 16 staff, is itself structured using some worker cooperative principles and practices, while maintaining many conventional nonprofit management elements.
At DAWI, we are organized legally as a membership nonprofit. Staff can apply to become members of the organization after one year. With membership comes several rights: the right to elect two members to our nine-person board, the right to receive and review annual financial statements, and the right to shape the budget and policies that directly impact staff.
Members also have responsibilities, including participating in annual meetings and in self-organized committees responsible for setting business strategy, developing personnel policies, and assessing the larger ecosystem. The executive director is a member of the organization and of the personnel committee. In addition to formal member rights and responsibilities, DAWI broadly elevates its staff as stakeholders. For instance, all staff, not just members, participate in the executive director evaluation.
Even without a formal membership structure, there are systems nonprofits can put into place to support people, demonstrate respect for staff experience and skills, and share power. The tools worker cooperatives have created to foster participation, delineate roles, and balance accountability are broadly useful beyond their specific structure. When we advise organizations on implementing more democratic practices, we work along a spectrum of possibilities with engagement and input at one end and full democratic control at the other end; we do not assume there is a universal “right answer.”
If you wish to implement participatory practices in your nonprofit, it’s important that you clarify your purpose for doing so—and set some realistic expectations or boundaries on what changes are desirable or doable, and in what timeframe. Some questions I often hear from executive directors curious about workplace democracy are, “How much power should I share with staff? Where are the boundaries?”
In a worker cooperative, the boundaries of power are delegated by role (owner-board-management), as is the level of accountability of each role to the others. The answer to the boundary question is not going to be the same for every nonprofit, but the path begins with examining your purpose. Do you want to share power because you think it is the right thing to do? It will help attract and retain the best people? You want to build staff leadership? Will it improve program outcomes? Something else? Let your reasons for increasing democratic practices help you set your boundaries.
Four Corner Posts
To help worker cooperatives and nonprofits think about applying democratic practices in a systematic way, I use a simple metaphor. Think of building a democratic workplace like you were building (or shoring up) a house. Any house needs four corner posts to stand, and for workplace democracy, these corner posts have to do with power, information, people, and money.
In DAWI’s recent publication, Democratic Management Guide for Managers and Others, I show how worker-owned cooperatives share power and information, invest in people, and compensate workers fairly. This guide includes case stories, practices, dozens of tools, and instructions for how to use them.
Here are a few examples of how each post is used in worker cooperatives and how they might translate.
Corner Post 1: Power
While research has shown that increasing worker participation contributes to productivity and retention, if staff participation is at the sole discretion of management, it can feel insincere to staff, who rightly perceive it as unconnected to their power. At worker cooperatives, members hold real power to decide on matters that affect them, so the organization needs to be clear about