Category:Open Company Formats

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Can we invent new corporate formats for P2P and commons-friendly, fair market approaches? What we need, specifically for peer production, is a supportive ecosystem!

Help us imagine a P2P Production Support Infrastructure!


Contents

The context

While fair markets are an acceptable mechanism to regulate supply and demand for certain scarce goods, unregulated capitalism has become an infinite-growth, scarcity engineering mechanism, which is incompatible with the long-term survival of humanity and the biosphere. More specifically, profit-maximising companies are engineered to ignore natural and social externalities, are legally obligated to maximally enrich their shareholders, and can only be regulated from the outside. When this outside is weak, the dominant corporate form lacks self-regulating mechanisms to respect natural limits and social justice.

However, open design and production communities have no compulsion to create artificial scarcity, and entrepreneurial coalitions that align themselves to such commons will have more sustainable practices. This sustainable practice can be strengthened even more through the choice of legal and institutional formats that regulate corporate entities 'from the inside', by creating a social and natural context for eventual profit making (and not 'profit-maximising'). Ideally, peer producers and contributors to commons of knowledge, software, and design could create their own ethical structures and network each other in ecologies of solidarity around the commons from which they derive their value.

So, at the core we have shared innovation commons, and the for-benefit associations which maintain them. These commons are surrounded by an entrepreneurial coalition of ethical companies, who use relocalized, open, and distributed manufacturing; but are organized in global material networks that are specifically designed to sustain their commons, i.e. Phyles.


Three Ways to Structure Contemporary Business

Daniel Tenner (summarizing Aaron Dignan ):

"Overview of three modern ways to structure a business, namely:

  • Holacracy (Medium, Zappos): "authority should be distributed, everyone should be able to sense and process (solve) the tensions (ideas/problems) they perceive, roles and employees are not one-to-one, and that the organization can and should evolve toward its “requisite structure” (the ultimate structure for its current environment)"
  • Agile squads (Spotify): "Instead of an engineering department, a design department, and a marketing department that each collaborate on products with dubious ownership, they organize vertically around products (or more specifically pieces of products) and traditional disciplines are loosely held horizontally."
  • Self-organising (Valve, Github): "Unlike the examples above, they accomplish this by essentially having no structure. Employees are encouraged to work on whatever they want — to find the projects that engage them and do the best work of their lives."

(http://swombat.com/2013/12/23/three-modern-organisational-structures)

What we like

  • The concept of Phyles, global, mission-oriented, community-supportive market entities


Indy Johar on the Open Venture Movement

"Our hypothesis

1. Venturing + Activism = one of the best instruments democratic instruments for changing the world

2. Open is both; Open as in radically transparent + Open as in (Openly Shareable + Openly Editable + Openly re-shareable) = a systemic pathway to a radically democratic economy

3. We believe Open is going from the Open web to the the Open Everyday

4. We have built a £4m framework accelerator to seed this Open everyday economy..

5. This will be a learning journey for us, the startups,..."

Typology of Generative Ownership Forms

Marjorie Kelly on THE FAMILY OF GENERATIVE OWNERSHIP DESIGN:

Commons and government ownership:

Assets like the ocean, a forest, land, a park, or a municipal power plant are held or governed indivisibly by a community. This category includes, but is not limited to, government ownership.


Stakeholder ownership:

Ownership by people with a human stake in a private enterprise – including cooperatives, partnerships, credit unions, mutual insurance companies, employee-owned firms, and family-owned companies – where the central purpose is a life-serving one.


Nonprofit and social enterprise ownership:

Organizations with a primary social or environmental mission, which rely either on charity (nonprofits) or use business methods (social enterprise). This category, which includes hospitals, universities and non-governmental organizations, embraces nonprofits, subsidiaries of nonprofits, and certain private businesses.


Mission-controlled corporations:

Corporations with a strong social purpose that are owned in conventional ways (often with publicly traded shares), yet keep governing control in mission-oriented hands. These can include family-controlled firms, and the large foundation-controlled companies common across northern Europe." (http://www.gtinitiative.org/documents/IssuePerspectives/GTI-Perspectives-Architecture_of_Enterprise.pdf)


Citations

Chris Carlsoon:

"Corporations ARE the problem as the common institutional form of late capitalism, the social system that is the real root of poverty and inequality. Corporations are (temporarily) immortal, often unaccountable to national laws, brazenly criminal, murderous, and have only one purpose: to accumulate capital. They are not, and cannot be, moral actors in society. Even if the most pious, ascetic monks were put in charge of large corporations, the fiduciary responsibility of corporate leaders is to ensure the growth of profits and wealth for the stockholders or private owners. Corporations are not formed to do anything useful or beneficial to humans (except as an accidental byproduct), nor other species, nor the planet as a whole, unless (and only if) the activity produces profits. Corporate leaders can be personally very greedy or completely indifferent to personal wealth. It does not matter. If they don’t show steadily increasing “growth” (accumulating capital) they will be replaced by the next interchangeable “captain of industry.” (http://www.nowtopians.com/work-and-the-economy/%E2%80%9Ccorporate-greed%E2%80%9D-is-not-the-problem)

Poor Richard:

The problems described above by Chris Carlson apply to most publicly-held for-profit corporations and many privately held ones, although the legal obligations to shareholders are much less strictly regulated in the latter case. In the case of not-for-profit corporations, if they receive tax-exempt status they are generally restricted to donations and grants for their funding. The regulations on tax-exempt non-profits are in part intended to prevent them from engaging in competition with for-profit businesses. They must remain dependent on charitable and philanthropic support. On the other hand, a cooperative may generate its own revenues in the same fashion as a for-profit corporation. It may distribute net revenues to its members, rebate them to customers, and/or retain them for expansion or other purposes. Certain kinds of non-profit cooperatives may qualify for tax exemptions, but as long as a cooperative does not book a profit it pays no income tax whether it has a specific exemption or not. Property tax treatments may vary. In the US there are several other corporate and cooperative forms, each with its own regulations and tax treatment. These include Limited Liability Companies (LLC), Subchapter S Corporations (S-Corp), Farmer Cooperatives, Electric Cooperatives, Credit Unions, and others. The most recent form in the US is the For-Benefit Corporation which is essentially a hybrid of the public, for-profit corp and the not-for-profit corp. Choosing the most appropriate form for any given purpose can be a complex task.

Visualisations


Key Resources

Key Books

  • The Shareholder Value Myth. Lynn Stout. "there’s also no solid evidence that shareholder power produces better results. In fact, there is some evidence that the more power we give shareholders the worse results we get." [1]

Related Sections

Pages in category "Open Company Formats"

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