International conference examines company-level participation

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In July 1998, the Basque government organised an international conference on employee participation in companies, with the aim of improving motivation and involvement at work, competitiveness, quality and productivity. The conference drew a number of interesting conclusions.

The International conference on participation in companies, which took place in July 1998, was organised by the Department of Justice, Economy, Employment and Social Security of the Basque government in Spain. Employers' associations and cooperatives played an active role in the conference, while the trade unions played a secondary role.

Objectives

The aim of the conference was to promote the culture of participation in companies and across the economy as a whole in order to improve competitiveness, tap the implicit and explicit knowledge of workers, increase motivation, involvement and job satisfaction, and improve attitudes and behaviour at work. Participation has become increasingly important in the human resources policies of large companies. The main argument put forward for this is that participation is today the key to improving product quality, fostering the application of and adaptation to new technologies and increasing productivity. Hence, according to the introductory document drawn up by a working group of the Basque government, participation is a challenge that extends beyond the strict environment of companies, so its objectives are also more general.

Thus, the Basque government wishes firstly to stimulate the development of a culture of participation amongst political authorities, organisations and institutions. Secondly, it wishes to incorporate participation into the training plans of workers, management and employers. Thirdly, it wishes to spread the experience of the most successful models of participation, some of which, like the Mondragón cooperatives, are already well known. A specialised magazine will therefore be created to disseminate experiences of participation. Fourthly, the government wishes to complement existing legislative measures with tax and trading measures that favour participation. Finally, the Basque Department of Industry will introduce into its competitiveness policies a recommendation to promote worker participation in health and safety and in economic decision-making.

Conclusions on participation in companies

According to some observers, the final conclusions of the conference panel had a clear business orientation that did not reflect the Basque government's official position. Nevertheless, they constitute an interesting document which draws the following main conclusions.

Participation in companies favours productivity and increases the profitability of companies, and therefore aids competitiveness. It also helps companies to adapt to new technologies, increases efficiency and facilitates organisational and technological restructuring. However, company-level participation faces four major obstacles:

1. employers (owners or managers) are reluctant to hand over part of their discretionary power through participatory procedures;
2. resistance is also encountered amongst middle management, where participation is seen as a loss of responsibility. Participation means more horizontal and less hierarchically dominated organisation charts. Middle managers are thus wary of participation and try to hinder its application. An alternative might be to make middle management responsible for coordinating and promoting participation;
3. resistance is also encountered amongst workers. On this point, trade unions observe that direct participation cannot be imposed unilaterally by the company. The unions call for the negotiation of participation and involvement, and the offer of compensation and incentives to do so; and
4. as the unions observe, the promotion of participation encounters the obstacle of insecure employment. Spain's high rate of temporary employment hinders learning, training and the qualification of workers. It is a barrier to motivation and to the development of a culture of participation.

Participation may be divided into three separate types: participation in the management and organisation of the company; participation in its economic results (often profits); and participation in the ownership of the company. At the conference, it was observed that most participation took place in the organisation of work, which could lead gradually to other types of participation through successive stages. However, participation in work organisation is a not a very common formula and is found in only a few innovative large companies. The document also concludes that participation in the company's economic results by itself generates more motivation, but only in the short term; it does not generate a culture of participation or change the organisational structure of the company. It also concludes that joint ownership is no guarantee of participation. Sometimes it means nothing at all, as in some cooperative companies, and it can even disguise authoritarian or elitist situations with little participation. In fact, these critical observations are confirmed in the experience of certain major cooperative companies.

In the document, participation is conceived as a long, gradual process involving training, vertical channels of information in both directions, communication, transparency, mutual trust, and individual and collective involvement through workers' representatives, workers' committee s and trade unions.

The document also states that participation should be implemented through collective bargaining. Labour legislation is not enough by itself, but can support and promote what the social partners agree. The challenge consists in stimulating a culture of participation through:

• training in the early school years;
• institutional participation in all areas or sectors to generate a culture of participation, dialogue and exchange; and
• creation of participatory institutions.

The document arguably ends on a rather idealistic note, stating that participation favours cooperation between capital and labour and therefore attenuates the traditional areas of conflict in industrial relations.

Commentary

The conclusions of the conference had a clear business orientation and to a certain extent idealise the idea of participation, even to the extent of ignoring the conflict between capital and labour.

Participation involves an extra-entrepreneurial culture, and is not limited to the company. It is also a form of economic democracy and a way of classifying institutions. Today, businesses and institutions are discovering participation as a talisman for achieving greater involvement of workers, and mobilising their implicit knowledge and skills in order to favour adaptation to new technologies and improve efficiency and productivity.

However, it has been known for many years that the organisation of companies and of work within them depends on the cultural environment. This involves in particular the culture of participation, which itself depends on the degree of conflict and inequality found in the social structure and on the degree of institutional participation by the social partners. (A Martín Artiles, QUIT-UAB)