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99-455: The Mondragon Corporation is a corporation and federation of worker cooperatives based in the Basque region of Spain . It was founded in the town of Mondragón in 1956 by Father José María Arizmendiarrieta and a group of his students at a technical college he founded. Its first product was paraffin heaters . It is the seventh-largest Spanish company in terms of asset turnover and
198-526: A financial institution , such as a bank . The deposit is a credit for the party (individual or organization) who placed it, and it may be taken back (withdrawn) in accordance with the terms agreed at time of deposit, transferred to some other party, or used for a purchase at a later date. Deposits are usually the main source of funding for banks. A demand deposit is a deposit that can be withdrawn or otherwise debited on short notice. Transaction accounts (known as "checking" or "current" accounts depending on
297-559: A humanist concept of business, a philosophy of participation and solidarity, and a shared business culture. The culture is rooted in a shared mission and a number of principles, corporate values and business policies. Over the years, these links have been embodied in a series of operating rules approved on a majority basis by the Co-operative Congresses, which regulate the activity of the Governing Bodies of
396-492: A separate legal person was mainly administrative, as a unified entity under which the rights and duties of all investors and managers could be channeled. However, there was still no limited liability and company members could still be held responsible for unlimited losses by the company. The next, crucial development, then, was the Limited Liability Act 1855 , passed at the behest of the then Vice President of
495-400: A charter granted by the government. As explained above, such charters were often enacted as private bills . Today, a corporation is formed, or incorporated , by registering with the state, province, or national government and regulated by the laws enacted by that government. Registration is the main prerequisite to the corporation's assumption of limited liability. The law sometimes requires
594-489: A corporation are typically controlled by individuals appointed by the members. In some cases, this will be a single individual but more commonly corporations are controlled by a committee or by committees. Broadly speaking, there are two kinds of committee structure. In countries with co-determination (such as in Germany ), workers elect a fixed fraction of the corporation's board. Historically, corporations were created by
693-436: A corporation as: a collection of many individuals united into one body, under a special denomination, having perpetual succession under an artificial form, and vested, by the policy of the law, with the capacity of acting, in several respects, as an individual, particularly of taking and granting property, of contracting obligations, and of suing and being sued, of enjoying privileges and immunities in common, and of exercising
792-558: A corporation can be classified as aggregate (the subject of this article) or sole (a legal entity consisting of a single incorporated office occupied by a single natural person ). Registered corporations have legal personality recognized by local authorities and their shares are owned by shareholders whose liability is generally limited to their investment. One of the attractive early advantages business corporations offered to their investors , compared to earlier business entities like sole proprietorships and joint partnerships ,
891-439: A corporation; shareholders instead elect or appoint a board of directors to control the corporation in a fiduciary capacity. In most circumstances, a shareholder may also serve as a director or officer of a corporation. Countries with co-determination employ the practice of workers of an enterprise having the right to vote for representatives on the board of directors in a company. The word "corporation" derives from corpus ,
990-656: A democratic vote. Compared to similar jobs at local industries, Mondragon managers' wages are considerably lower (as some companies pay their best paid managers hundreds of times more than the lowest-paid employee of the company) and equivalent for middle management, technical and professional levels. Lower wage levels are on average 13% higher than similar jobs at local businesses. Spain's progressive tax rate further reduces any disparity in pay. These comparatively low wages can make it very difficult to recruit managers from investor-owned firms. Mondragon Corporation operates in four areas: finance, industry, retail, and knowledge, with
1089-424: A distinct name. Historically, some corporations were named after the members of their boards of directors: for example, the " President and Fellows of Harvard College " is the name of one of the two governing boards of Harvard University , but it is also the exact name under which Harvard was legally incorporated. Nowadays, corporations in most jurisdictions have a distinct name that does not need to make reference to
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#17327878424941188-498: A dual focus: education-training and innovation, which have both been key elements in the development of the corporation. Training-education is mainly linked to the dynamism of Mondragon University , the significant role that Politeknika Ikastegia Txorierri, Arizmendi Ikastola and Lea Artibai Ikastetxea play in their respective areas and the activity of the Management and Co-operative Development Centre Otalora. Mondragon University
1287-411: A fundamental role in the development of the sectors of focus. In 2009 they employed 742 people and had a budget of €53.7 million. In 2013 its network of technology centers and R&D units provided employment for 1,700 people and the commitment to R&D&I matters amounted to 136 million Euros, 8.5% of added value. Mondragon has 479 families of Patents for Inventions, which accounts for 25% patents in
1386-717: A key inspiration. In 2312 , a science fiction novel by Kim Stanley Robinson , the Mondragon Corporation has evolved into a planned economy system called the Mondragon Accord . The Mondragon Accord is controlled by means of a network of AIs running on quantum computers , and rules large parts of the Solar System , including Mercury and most of the moons of the gas giants ; only part of Earth , and its colonies in space, retain remnants of capitalist economies, while Mars has withdrawn from
1485-519: A market system and they still exploit workers in South America, and they do things that are harmful to the society as a whole and they have no choice. If you’re in a system where you must make a profit in order to survive, you're compelled to ignore negative externalities, effects on others . Vicenç Navarro wrote that, from a business perspective, Mondragon is successful in matching efficiency with solidarity and democracy. However, he writes that
1584-899: A modern language service, manufactures educational equipment, and provides graphic arts services (mccgraphics S.Coop). In 2013, 71.1% of turnover came from international sales. Sales resulting from the export of products abroad and production generated in the 122 subsidiaries located in several different countries: China (15), France (17), Poland (8), Czech Republic (7), Mexico (8), Brazil (5), Germany (4), Italy (4), United Kingdom (3), Romania (3), United States (4), Turkey (2), Portugal (2), Slovakia (2), India (5), Thailand (1) and Morocco (1). Overall, in 2013 these 122 plants provided work for more than 11,000 people. The corporate industrial park in Kunshan , close to Shanghai houses seven subsidiaries. In 2012, it opened 11 new subsidiaries abroad, employing around 14,000 people. Its international sales that year marked
1683-399: A monarch or passed by a parliament or legislature). Most jurisdictions now allow the creation of new corporations through registration . Corporations come in many different types but are usually divided by the law of the jurisdiction where they are chartered based on two aspects: whether they can issue stock , or whether they are formed to make a profit . Depending on the number of owners,
1782-537: A partnership arose. Early guilds and livery companies were also often involved in the regulation of competition between traders. Dutch and English chartered companies, such as the Dutch East India Company (also known by its Dutch initials: VOC) and the Hudson's Bay Company , were created to lead the colonial ventures of European nations in the 17th century. Acting under a charter sanctioned by
1881-553: A partnership or some other form of collective ownership (in the United States it can be used by a sole proprietorship but this is not generally the case elsewhere). Despite not being human beings, corporations have been ruled legal persons in a few countries, and have many of the same rights as natural persons do. For example, a corporation can own property, and can sue or be sued for as long as it exists. Corporations can exercise human rights against real individuals and
1980-481: A private act to allow an individual to represent the whole in legal proceedings, this was a narrow and necessarily costly expedient, allowed only to established companies. Then, in 1843, William Gladstone became the chairman of a Parliamentary Committee on Joint Stock Companies, which led to the Joint Stock Companies Act 1844 , regarded as the first modern piece of company law. The Act created
2079-466: A proliferation of laws allowing for the creation of corporations by registration across the world, which helped to drive economic booms in many countries before and after World War I. Another major post World War I shift was toward the development of conglomerates , in which large corporations purchased smaller corporations to expand their industrial base. Starting in the 1980s, many countries with large state-owned corporations moved toward privatization ,
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#17327878424942178-467: A record number of 69% of its total sales (€5.8 billion, with a 2% fall compared to the previous year). Mondragon also participated in 91 international R&D projects. In 2014, the industrial cooperatives created 1,000 jobs, and internationalization continued with 125 production subsidiaries abroad – 3 more than the year before. Mondragon runs Eroski , one of the leading retail groups all over Spain and in southern France, and maintains close contacts with
2277-958: A variety of political rights, more or less extensive, according to the design of its institution, or the powers conferred upon it, either at the time of its creation or at any subsequent period of its existence. Due to the late 18th century abandonment of mercantilist economic theory and the rise of classical liberalism and laissez-faire economic theory due to a revolution in economics led by Adam Smith and other economists, corporations transitioned from being government or guild affiliated entities to being public and private economic entities free of governmental directions. Smith wrote in his 1776 work The Wealth of Nations that mass corporate activity could not match private entrepreneurship, because people in charge of others' money would not exercise as much care as they would with their own. The British Bubble Act 1720s prohibition on establishing companies remained in force until its repeal in 1825. By this point,
2376-423: A working model of an alternative to the capitalist mode of production . In an April 2012 interview, Noam Chomsky said that, while Mondragon offers an alternative to capitalism, it was still embedded in a capitalist system which limits Mondragon's decisions: Take the most advanced case: Mondragon. It’s worker-owned, it’s not worker managed , although the management does come from the workforce often, but it’s in
2475-556: Is a co-operative university, which combines the development of knowledge, skills, and values, and maintains close relations with business, especially Mondragon co-operatives. Technological innovation is generated through the co-operatives' own R&D departments, the Corporate Science and Technology Plan, the corporation's 12 technology centers and the Garaia Innovation Park. The 15 technology centers play
2574-473: Is authorized to issue, and the names and addresses of directors. Once the articles are approved, the corporation's directors meet to create bylaws that govern the internal functions of the corporation, such as meeting procedures and officer positions. In theory, a corporation cannot own its own stock. An exception is treasury stock , where the company essentially buys back stock from its shareholders, which reduces its outstanding shares. This essentially becomes
2673-447: Is limited: one can only collect from whatever assets the entity still controls when one obtains a judgment against it. Corporate names are supposed to be unique to the jurisdiction in which the corporation is registered. Governments will not allow another corporation or any other kind of legal entity to register a name that is too similar to the name of an existing corporation. However, since "different states may register entities with
2772-593: Is one of four case studies analyzed in Capital and the Debt Trap , which summarized evidence claiming that cooperatives tend to last longer and are less susceptible to perverse incentives and other problems of organizational governance than more traditionally managed organizations. The founders of Cooperation Jackson , a network of worker cooperatives in Jackson, Mississippi in the United States, cite Mondragon as
2871-407: Is usually required to register with other governments as a foreign corporation and must formally appoint a registered agent to accept service of process within such other jurisdictions. A foreign corporation is almost always subject to the laws of its host state pertaining to external affairs such as employment , crimes , contracts , civil actions , and the like. Corporations generally have
2970-506: The BRIC markets increased to 20% compared to the previous year. In 2013, international sales grew by 6.7% and accounted for 71.1% of total sales. On 16 October 2013, domestic appliance company Fagor Electrodomésticos filed for bankruptcy under Spanish law to renegotiate €1,1 billion of debt, after suffering heavy losses during the eurocrisis and the 2008–2014 Spanish real estate crisis putting 5,600 employees at risk of losing their jobs. This
3069-715: The Industrial Revolution had gathered pace, pressing for legal change to facilitate business activity. The repeal was the beginning of a gradual lifting on restrictions, though business ventures (such as those chronicled by Charles Dickens in Martin Chuzzlewit ) under primitive companies legislation were often scams. Without cohesive regulation, proverbial operations like the "Anglo-Bengalee Disinterested Loan and Life Assurance Company" were undercapitalized ventures promising no hope of success except for richly paid promoters. The process of incorporation
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3168-620: The Latin word for body, or a "body of people". By the time of Justinian (reigned 527–565), Roman law recognized a range of corporate entities under the names Universitas , corpus or collegium . Following the passage of the Lex Julia during the reign of Julius Caesar as Consul and Dictator of the Roman Republic (49–44 BC), and their reaffirmation during the reign of Caesar Augustus as Princeps senatus and Imperator of
3267-457: The Registrar of Joint Stock Companies , empowered to register companies by a two-stage process. The first, provisional, stage cost £5 and did not confer corporate status, which arose after completing the second stage for another £5. For the first time in history, it was possible for ordinary people through a simple registration procedure to incorporate. The advantage of establishing a company as
3366-853: The Roman Army (27 BC–14 AD), collegia required the approval of the Roman Senate or the Emperor in order to be authorized as legal bodies . These included the state itself (the Populus Romanus ), municipalities, and such private associations as sponsors of a religious cult , burial clubs , political groups, and guilds of craftsmen or traders. Such bodies commonly had the right to own property and make contracts, to receive gifts and legacies, to sue and be sued, and, in general, to perform legal acts through representatives. Private associations were granted designated privileges and liberties by
3465-622: The Spanish economy . During these years, also with the encouragement of Arizmendiarrieta, the Caja Laboral ("Labor savings bank", 1959) and the Social Welfare Body Lagun Aro ("Friend/help time", 1966 were established that played a key role. The first local group was created, Ularco. In 1969, Eroski was founded by merging ten small local consumer co-operatives . During the next 20 years, from 1970 to 1990,
3564-830: The Statement on the Co-operative Identity maintained by the International Co-operative Alliance . In 1941, as a young Catholic priest, Arizmendiarrieta settled in Mondragón, a town with a population of 7,000 that had not yet recovered from the poverty, hunger, exile, and tension of the Spanish Civil War . In 1943, Arizmendiarrieta established a technical college which became a training ground for managers, engineers and skilled labour for local companies, and primarily for
3663-729: The War of the Spanish Succession , which gave Great Britain an asiento to trade in the region for thirty years. In fact, the Spanish remained hostile and let only one ship a year enter. Unaware of the problems, investors in Britain, enticed by extravagant promises of profit from company promoters bought thousands of shares. By 1717, the South Sea Company was so wealthy (still having done no real business) that it assumed
3762-562: The public debt of the British government. This accelerated the inflation of the share price further, as did the Bubble Act 1720 , which (possibly with the motive of protecting the South Sea Company from competition) prohibited the establishment of any companies without a royal charter. The share price rose so rapidly that people began buying shares merely in order to sell them at a higher price, which in turn led to higher share prices. This
3861-623: The Accord in the century preceding the story. The Mondragon Corporation already appeared in Robinson's earlier Mars trilogy , as one of the Terran groups involved in the colonization and terraforming of Mars ; the coop is also portrayed as the inspiration of both the bogdanovist movement and the libertarian-leaning Praxis Corporation two of the main forces leading the revolution for the independence of Mars. In Robinson's book The Ministry for
3960-577: The Basque Country, participating in more than 30 R&D cooperation projects at the European level. In 2012, Richard D. Wolff , an American professor of economics, hailed the Mondragon set of enterprises, including the good wages it provides for employees, the empowerment of ordinary workers in decision making, and the measure of equality for female workers, as a major success and cited it as
4059-658: The Board of Trade, Robert Lowe . This allowed investors to limit their liability in the event of business failure to the amount they invested in the company – shareholders were still liable directly to creditors , but just for the unpaid portion of their shares . (The principle that shareholders are liable to the corporation had been introduced in the Joint Stock Companies Act 1844). The 1855 Act allowed limited liability to companies of more than 25 members (shareholders). Insurance companies were excluded from
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4158-713: The Dutch government, the Dutch East India Company defeated Portuguese forces and established itself in the Moluccan Islands in order to profit from the European demand for spices . Investors in the VOC were issued paper certificates as proof of share ownership, and were able to trade their shares on the original Amsterdam Stock Exchange . Shareholders were also explicitly granted limited liability in
4257-699: The English East India Company would come to symbolize the dazzlingly rich potential of the corporation, as well as new methods of business that could be both brutal and exploitative. On 31 December 1600, Queen Elizabeth I granted the company a 15-year monopoly on trade to and from the East Indies and Africa . By 1711, shareholders in the East India Company were earning a return on their investment of almost 150 per cent. Subsequent stock offerings demonstrated just how lucrative
4356-945: The French group Les Mousquetaires and the German retailer Edeka , with whom it set up the Alidis international purchasing group in 2002. The worker-owners and consumer-members participate in the co-operative's decision-making bodies and management of Eroski. At the end of 2013, Eroski posted a turnover of €6.6 billion, operating 2.069 stores made up of 90 Eroski hypermarkets, 1,211 Eroski/center, Caprabo , Eroski/city, Aliprox, Familia, Onda and Cash & Carry supermarkets, 155 branches of Eroski travel agencies, 63 petrol stations, 39 Forum Sport stores and 221 IF perfume stores. In southern France Eroski had 4 hypermarkets, 16 supermarkets and 17 petrol stations, and 4 perfume stores in Andorra. Retail includes
4455-611: The Future , the Mondragon Corporation is introduced in chapter 58 as a model for a future, post-capitalist, cooperative economy. Corporation A corporation is an organization —usually a group of people or a company —authorized by the state to act as a single entity (a legal entity recognized by private and public law as "born out of statute"; a legal person in a legal context) and recognized as such in law for certain purposes. Early incorporated entities were established by charter (i.e., by an ad hoc act granted by
4554-400: The Mondragon Corporation. The company was called Talleres Ulgor ("Ulgor workshops"), an acronym derived from the surnames of Usatorre, Larrañaga, Gorroñogoitia, Ormaechea, and Ortubay, known today as Fagor Electrodomésticos (Spanish for "Fagor electric appliances"). In the first 15 years, many co-operatives were established, thanks to the autarky of the market and the awakening of
4653-464: The Sovereignty of Labour, Instrumental and Subordinate Nature of Capital, Participatory Management, Payment Solidarity, Inter-cooperation, Social Transformation, Universality and Education. This philosophy is complemented by four corporate values: Co-operation , acting as owners and protagonists; Participation , which takes shape as a commitment to management; Social Responsibility , by means of
4752-472: The UK, such as fraud and corporate manslaughter . However, corporations are not considered living entities in the way that humans are. Legal scholars and others, such as Joel Bakan , have observed that a business corporation created as a "legal person" has a psychopathic personality because it is required to elevate its own interests above those of others even when this inflicts major risks and grave harms on
4851-607: The USW, Mondragon, and the Ohio Employee Ownership Center (OEOC) announced their detailed union co-op model . The industrial sector ended 2012 with a new record of €4 billion in international sales, beating sales figures from before the financial crisis of 2007–2008 . Mondragon opened 11 new production subsidiaries. International sales that year accounted for 69% of all sales, a 26% increase from 2009 to 2012, and with 14,000 employees abroad. Mondragon's share in
4950-937: The Voluntary Social Welfare Body Lagun Aro , which had an asset fund totaling €5,566 million at the end of 2014. The yield obtained from this fund is used to cover long-term retirement, widowhood, and invalidity benefits, complementary to those offered by the Spanish social security system. The corporation's companies manufacture consumer goods, capital goods , industrial components, products, and systems for construction, and services. The latter includes very diverse business groups such as Abantail: Adaptive design optimization, Alecop: Engineering training, LKS Consultores: Attorneys etc., KREAN: Architects and engineers. MCCTelecom: Telecommunication engineering. Mondragon Lingua: Translation and language schools, Mondragon Sistemas: Automation, Industrial Computing and Telecommunications. Ondoan: Turnkey projects in
5049-539: The act, though it was standard practice for insurance contracts to exclude action against individual members. Limited liability for insurance companies was allowed by the Companies Act 1862 . This prompted the English periodical The Economist to write in 1855 that "never, perhaps, was a change so vehemently and generally demanded, of which the importance was so much overrated." The major error of this judgment
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#17327878424945148-432: The catering industry, cold stores, and refrigeration equipment. Specifically focusing on the automotive sector, the corporation also manufactures a wide variety of dies, molds and tooling for casting iron and aluminium, and occupies a leading position in machinery for the casting sector. In Industrial Components, Mondragon posted a turnover of €1.5 billion in 2009, a sector in which it operates as an integrated supplier for
5247-422: The co-operatives. Arizmendiarrieta spent a number of years educating young people about a form of humanism based on solidarity and participation, in harmony with Catholic social teaching , and the importance of acquiring the necessary technical knowledge before creating the first co-operative . In 1955, he selected five young people to establish the first company of the co-operative and industrial beginning of
5346-613: The company had become. Its first stock offering in 1713–1716 raised £418,000, its second in 1717–1722 raised £1.6 million. A similar chartered company , the South Sea Company , was established in 1711 to trade in the Spanish South American colonies, but met with less success. The South Sea Company's monopoly rights were supposedly backed by the Treaty of Utrecht , signed in 1713 as a settlement following
5445-556: The company's royal charter. In England, the government created corporations under a royal charter or an Act of Parliament with the grant of a monopoly over a specified territory. The best-known example, established in 1600, was the East India Company of London . Queen Elizabeth I granted it the exclusive right to trade with all countries to the east of the Cape of Good Hope . Some corporations at this time would act on
5544-402: The corporate model for this reason (as a trust ). State governments began to adopt more permissive corporate laws from the early 19th century, although these were all restrictive in design, often with the intention of preventing corporations from gaining too much wealth and power. New Jersey was the first state to adopt an "enabling" corporate law, with the goal of attracting more business to
5643-490: The corporate status of the entity (for example, "Incorporated" or "Inc." in the United States) or the limited liability of its members (for example, "Limited", "Ltd.", or "LLC"). These terms vary by jurisdiction and language. In some jurisdictions, they are mandatory, and in others, such as California, they are not. Their use puts everybody on constructive notice that they are dealing with an entity whose liability
5742-556: The corporation (Standing Committee, General Council), the Grassroots Co-operatives and the Divisions they belong to, from the organisational, institutional and economic points of view as well as in terms of assets. This framework of business culture has been structured based on a common culture derived from the 10 Basic Co-operative Principles , in which Mondragon is rooted: Open Admission, Democratic Organisation,
5841-408: The corporation is determined by the portion of shares in the company that they own. Thus, a person who owns a quarter of the shares of a joint-stock company owns a quarter of the company, is entitled to a quarter of the profit (or at least a quarter of the profit given to shareholders as dividends) and has a quarter of the votes capable of being cast at general meetings. In another kind of corporation,
5940-632: The corporation is through stock, and owners of stock are referred to as stockholders or shareholders . Corporations not allowed to issue stock are referred to as non-stock corporations ; i.e. those who are considered the owners of a non-stock corporation are persons (or other entities) who have obtained membership in the corporation and are referred to as a member of the corporation. Corporations chartered in regions where they are distinguished by whether they are allowed to be for-profit are referred to as for-profit and not-for-profit corporations, respectively. Shareholders do not typically actively manage
6039-408: The corporation to designate its principal address, as well as a registered agent (a person or company designated to receive legal service of process). It may also be required to designate an agent or other legal representatives of the corporation. Generally, a corporation files articles of incorporation with the government, laying out the general nature of the corporation, the amount of stock it
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#17327878424946138-411: The corporation's organisational levels and incorporated into the four-year strategic plans and the annual business plans of the individual co-operatives, divisions, and the corporation as a whole. At Mondragon, there are agreed-upon wage ratios between executive work and field or factory work which earns a minimum wage. These ratios range from 3:1 to 9:1 in different cooperatives and average 5:1. That is,
6237-401: The country) can be used to pay other parties, while savings accounts are typically payable only to the depositor or another bank account, and may have limits on the frequency of withdrawal. Deposits which are kept for any specific time period are called time deposit or often as term deposit. Normally any money deposited to a bank becomes property of the bank, for which it is liable to return
6336-498: The courts classed them as riskier debt instruments. When the yields fell during the financial crisis, bond-holders sued against the cooperatives. In 2008, the worker-owners of the cooperatives Ampo (metal casting) and Irizar (coaches) voted to leave the corporation. In October 2009, the United Steelworkers announced an agreement with Mondragon to create worker cooperatives in the United States. On 26 March 2012,
6435-590: The distribution of wealth based on solidarity; and Innovation , focusing on constant renewal in all areas. This business culture translates into compliance with a number of Basic Objectives (Customer Focus, Development, Innovation, Profitability, People in Co-operation and Involvement in the Community) and General Policies approved by the Co-operative Congress, which are taken on board at all
6534-546: The dynamic continued, with a strong increase in new co-operatives promoted by Caja Laboral's Business Division, the promotion of co-operative associations, the formation of local groups, and the founding of the Ikerlan ("Research work") research centre in 1974. With Spain scheduled to join the European Economic Community in 1986, it was decided in 1984 to establish the "Mondragon Co-operative Group",
6633-520: The emperor. The concept of the corporation was revived in the Middle Ages with the recovery and annotation of Justinian's Corpus Juris Civilis by the glossators and their successors the commentators in the 11th–14th centuries. Particularly important in this respect were the Italian jurists Bartolus de Saxoferrato and Baldus de Ubaldis , the latter of whom connected the corporation to
6732-602: The energy and environmental sector. In the leisure and sports area, it manufactures Orbea bicycles, exercise equipment and items for camping, garden and beach. In capital goods, Mondragon posted a turnover of €976 million in 2009 and is the leading Spanish manufacturer of machining (Danobat Group) and sheet metal forming (Fagor Arrasate Group) machine tools. These machines are complemented by automation and control products for machine tools, packaging machinery, machinery for automating assembly processes and processing wood, forklift trucks, electric transformers, integrated equipment for
6831-422: The equivalent of unissued capital, where it is not classified as an asset on the balance sheet (passive capital). Under the internal affairs doctrine , the law of the jurisdiction in which a corporation is incorporated will govern its internal activities—that is, conflicts between shareholders and managers such as the board of directors and corporate officers. If a corporation operates outside its home state, it
6930-423: The food group Erkop , for catering, cleaning, stock-breeding, and horticulture with Auzo Lagun , a co-operative in group catering and cleaning of buildings and premises, and integrated service in the health sector. In 2008, worker-members voted to expand the cooperative transformation to the retail group as a whole, turning subsidiaries into co-operatives , and making salaried workers worker-members. This area has
7029-402: The forerunner of the current corporation. In-service training for managers was strengthened by creating Otalora, dedicated to training, and the dissemination of co-operatives. The Group consisted of 23,130 workers at the end of 1990. On the international stage, the aim was to respond to growing globalisation , expanding abroad by establishing production plants in a number of countries. The first
7128-430: The general manager of an average Mondragon cooperative earns no more than 5 times as much as the theoretical minimum wage paid in their cooperative. For most workers, this ratio is smaller because there are few Mondragon worker-owners that earn minimum wages, because most jobs are somewhat specialized and are classified at higher wage levels. The wage ratio of a cooperative is decided periodically by its worker-owners through
7227-460: The government's behalf, bringing in revenue from its exploits abroad. Subsequently, the company became increasingly integrated with English and later British military and colonial policy, just as most corporations were essentially dependent on the Royal Navy 's ability to control trade routes. Labeled by both contemporaries and historians as "the grandest society of merchants in the universe",
7326-661: The history of companies was the 1897 decision of the House of Lords in Salomon v. Salomon & Co. where the House of Lords confirmed the separate legal personality of the company, and that the liabilities of the company were separate and distinct from those of its owners. In the United States , forming a corporation usually required an act of legislation until the late 19th century. Many private firms, such as Carnegie 's steel company and Rockefeller 's Standard Oil , avoided
7425-474: The idea of the corporation as legal persons can help to clarify the role of citizens as political stakeholders , and to break down the sharp conceptual dichotomy between the state and the people or the individual, a distinction that, on his account, is "increasingly unable to meet the demands placed on the state in the modern world". Other Deposit (finance) A deposit is the act of placing cash (or cash equivalent) with some entity, most commonly with
7524-439: The industrialization of the construction process, including engineering and assembly services. The ORONA Group produces elevators. In services to business, sales totaled €248 million in 2008, including business consultancy services , architecture and engineering , property consulting, design and innovation (LKS Group), systems engineering for electromechanical installations, and integrated logistics engineering. It also offers
7623-650: The landmark 1856 Joint Stock Companies Act . This was subsequently consolidated with a number of other statutes in the Companies Act 1862, which remained in force for the rest of the century, up to and including the time of the decision in Salomon v A Salomon & Co Ltd . The legislation shortly gave way to a railway boom, and from then, the numbers of companies formed soared. In the later nineteenth century, depression took hold, and just as company numbers had boomed, many began to implode and fall into insolvency. Much strong academic, legislative and judicial opinion
7722-406: The latter distinguishing Mondragon from other business groups. In 2013, the corporation posted a total revenue of over €12 billion (roughly US$ 16 billion), and employed 74,061 workers, making it Spain's fourth-largest industrial and tenth-largest financial group. This area includes the banking business of Laboral Kutxa (successor of Caja Laboral ), the insurance company Seguros Lagun Aro , and
7821-1048: The leading car manufacturers , offering from the design and development of a part to the industrialization and supply of components and assemblies. It has different business units such as brakes, axles, suspension, transmission, engines, aluminium wheel rims, fluid conduction, and other internal and external vehicle components. It also produces components for the main domestic appliance manufacturers in three business areas: white goods, home comfort, and electronics. And it manufactures flanges and pipe accessories for processing oil-gas, petrochemical plants and power generation, copper and aluminium electrical conductors, and components for conveyors. In construction, sales totaled €974 million in 2009. Mondragon has constructed buildings and important infrastructure projects. It designs and builds large metallic (URSSA), laminated wood and prefabricated concrete structures; supplies prefabricated parts in polymer concrete ; offers solutions for formwork and structures ( ULMA Group ) as well as public works machinery and
7920-474: The leading business group in the Basque Country . At the end of 2016, it employed 74,117 people in 257 companies and organizations in four areas of activity: finance, industry, retail and knowledge. By 2019, 81,507 people were employed. In 2024, it had over 70,000 workers, 30,660 in the Basque Country, 29,340 in the rest of Spain and around 10,000 abroad. Mondragon cooperatives operate in accordance with
8019-423: The leave is a workforce drop by 13% and a 15% cut of the group's sales. As successful cooperatives they were contributing 10% of their profit to a common fund supporting ailing cooperatives. They will not contribute to the solidarity fund but they will keep insuring their workers with Lagun Aro and collaborate with Mondragon Unibertsitatea and other cooperatives in the group. Mondragon co-operatives are united by
8118-425: The legal document which established the corporation or which contains its current rules will determine the requirements for membership in the corporation. What these requirements are depends on the kind of corporation involved. In a worker cooperative , the members are people who work for the cooperative. In a credit union , the members are people who have accounts with the credit union. The day-to-day activities of
8217-532: The lives of any particular member, existing in perpetuity. The alleged oldest commercial corporation in the world, the Stora Kopparberg mining community in Falun , Sweden , obtained a charter from King Magnus Eriksson in 1347. In medieval times , traders would do business through common law constructs, such as partnerships . Whenever people acted together with a view to profit, the law deemed that
8316-417: The members of their boards. In Canada, this possibility is taken to its logical extreme: many smaller Canadian corporations have no names at all, merely numbers based on a registration number (for example, "12345678 Ontario Limited"), which is assigned by the provincial or territorial government where the corporation incorporates. In most countries, corporate names include a term or an abbreviation that denotes
8415-538: The metaphor of the body politic to describe the state . Early entities which carried on business and were the subjects of legal rights included the collegium of ancient Rome and the sreni of the Maurya Empire in ancient India. In medieval Europe, churches became incorporated, as did local governments, such as the City of London Corporation . The point was that the incorporation would survive longer than
8514-548: The number of employees who are not owners has increased more rapidly than worker-owners, to a point that in some companies, for example in the supermarket chains owned by Mondragon, the first is a much larger group than the second. In Navarro's view, this establishes a two-tier system – for example, in terms of whom to save in the case the company collapses. In the collapse of Fagor, the relocation of employees to other companies belonging to Mondragon favored those who were worker-owners, which may affect labor relations: Actually, one of
8613-411: The public or on other third-parties. Such critics note that the legal mandate of the corporation to focus exclusively on corporate profits and self-interest often victimizes employees, customers, the public at large, and/or the natural resources . The political theorist David Runciman notes that corporate personhood forms a fundamental part of the modern history of the idea of the state , and believes
8712-407: The same names, a corporate name is a unique identifier only when combined with the name of the state of incorporation". This explains why lawyers in legal papers often expressly refer to a corporation's state of incorporation after the first mention of its name. Some jurisdictions do not allow the use of the word " company " alone to denote corporate status, since the word " company " may refer to
8811-431: The selling of publicly owned (or 'nationalised') services and enterprises to corporations. Deregulation (reducing the regulation of corporate activity) often accompanied privatization as part of a laissez-faire policy. A corporation is, at least in theory, owned and controlled by its members. In a joint-stock company the members are known as shareholders, and each of their shares in the ownership, control, and profits of
8910-500: The state, and they can themselves be responsible for human rights violations. Corporations can be "dissolved" either by statutory operation, the order of the court, or voluntary action on the part of shareholders. Insolvency may result in a form of corporate failure, when creditors force the liquidation and dissolution of the corporation under court order, but it most often results in a restructuring of corporate holdings. Corporations can even be convicted of special criminal offenses in
9009-581: The state, in 1896. In 1899, Delaware followed New Jersey's lead with the enactment of an enabling corporate statute, but Delaware only became the leading corporate state after the enabling provisions of the 1896 New Jersey corporate law were repealed in 1913. The end of the 19th century saw the emergence of holding companies and corporate mergers creating larger corporations with dispersed shareholders. Countries began enacting antitrust laws to prevent anti-competitive practices and corporations were granted more legal rights and protections. The 20th century saw
9108-409: The successes of Mondragon was its ability to create a sense of identity among the workers within the company, encouraging an environment of solidarity and collegiality among them, a feeling that also extended (although to a much lesser degree) to non-worker-owners. The connection felt by the latter group has somewhat weakened, however, exposing a vulnerable point for the cooperative. The Mondragon system
9207-417: Was followed by the bankruptcy of the whole Fagor group on 6 November 2013. In July 2014, Fagor was bought by Catalonian company Cata for €42.5 million. Cata pledged to create 705 direct jobs in the Basque Country and to continue the brand names Fagor, Edesa, Aspes, and Splendid. In 2022, the worker-owners of ULMA Group (scaffolding) and Orona (elevators) voted to leave the corporation. Estimated impact of
9306-550: Was limited liability. Limited liability separates control of a company from ownership and means that a passive shareholder in a corporation will not be personally liable either for contractually agreed obligations of the corporation, or for torts (involuntary harms) committed by the corporation against a third party (acts done by the controllers of the corporation). Where local law distinguishes corporations by their ability to issue stock , corporations allowed to do so are referred to as stock corporations ; one type of investment in
9405-484: Was opposed to the notion that businessmen could escape accountability for their role in the failing businesses. In 1892, Germany introduced the Gesellschaft mit beschränkter Haftung with a separate legal personality and limited liability even if all the shares of the company were held by only one person. This inspired other countries to introduce corporations of this kind. The last significant development in
9504-454: Was possible only through a royal charter or a private act and was limited, owing to Parliament's jealous protection of the privileges and advantages thereby granted. As a result, many businesses came to be operated as unincorporated associations with possibly thousands of members. Any consequent litigation had to be carried out in the joint names of all the members and was almost impossibly cumbersome. Though Parliament would sometimes grant
9603-534: Was recognised by the same magazine more than 70 years later, when it claimed that, "[t]he economic historian of the future... may be inclined to assign to the nameless inventor of the principle of limited liability, as applied to trade corporations, a place of honour with Watt and Stephenson , and other pioneers of the Industrial Revolution. " These two features – a simple registration procedure and limited liability – were subsequently codified into
9702-675: Was the Copreci plant in Mexico in 1990, followed by many others: up to 73 by the end of 2008, and 122 at the end of 2013. The goals were to increase competitiveness and market share, bring component supply closer to customers' plants, especially in the automotive and domestic appliance sectors, and to strengthen employment in the Basque Country by promoting exports of co-operatives' products by means of new platforms. Between 2002 and 2007, Fagor and Eroski issued bonds ( aportaciones subordinadas ). While they were commercialized as safe deposits ,
9801-417: Was the first speculative bubble the country had seen, but by the end of 1720, the bubble had "burst", and the share price sank from £1,000 to under £100. As bankruptcies and recriminations ricocheted through government and high society, the mood against corporations and errant directors was bitter. In the late 18th century, Stewart Kyd , the author of the first treatise on corporate law in English, defined
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