Experimenting with co-operative governance

[andia]

Experimenting with co-operative governance

Team member names

Andi Argast
Vincent Charlebois

Short summary of your improvement idea

Worker co-operatives are an established and enduring protocol for organizing labour and distributing wages. Our proposal seeks to evolve this soft, systemic protocol, addressing its documented governance challenges that often impede strategic decision-making and collaboration (source).

Our proposal is to improve the “one member, one vote” decision making that occurs within worker co-operatives. This type of democratic governance is relevant to other types of co-operatives (e.g. housing co-ops, multi-stakeholder co-ops, etc.) and a range of entities including DAOs, collectives, and other social purpose organizations. As distributed and decentralized work becomes increasingly common, workers require new tools to combat precarity and become active participants in their own labour; the co-operative structure offers one such organizing protocol. Yet, it’s clear from our experience that co-ops’ decision making and conflict resolution must evolve to become more learnable both within and outside of the co-operative sector. Our proposed improvement strikes at the heart of what it means to fully participate in a democratic workplace and in a democracy writ large.

What is the existing target protocol you are hoping to improve or enhance? Eg: hand-washing, traffic system, connector standards, carbon trading.

The worker co-operative as a social, stewardable, evolvable, organizational protocol. Specifically, we are interested in governance and wage distribution within worker-owned co-operatives as means of exploring the protocol’s sociotechnical entanglements.

What is the core idea or insight about potential improvement you want to pursue?

In the wake of the pandemic, work has irrevocably changed. From public service employers offering WFH as a perk to tech companies looking to keep their overhead low, workers are more physically scattered than ever before. Co-operatives are also becoming more distributed, especially those working in tech, design, and digital media production. In this context, co-operative governance protocols are a particular challenge. Frequently used governance models such as sociocracy are too slow to be effective in fast-paced environments. Based on the requirements of (1) one member, one vote; (2) speed of decision-making; and (3) geographic distribution, we want to field test various decentralized decision making tools, whose typical use-cases are for DAOs (e.g. hundreds of relatively anonymous users), in the high-trust and smaller worker co-op environment. Our proposal bridges co-ops to DeGov proponents in an applied way; if DAOs are to become a viable and enduring form of organizing work, this model must overcome its own challenges related to financial and material security, among other issues. Taking a bricolage approach, we will stitch together practices and tools to evolve the existing worker co-operative governance protocol.

What is your discovery methodology for investigating the current state of the target protocol? Eg: field observation, expert interviews, historical data analysis, failure event analysis

We are member-workers of Hypha Worker Co-operative, a technology co-op. Using a combination of field observations (studying the efficacy of decision-making mechanisms within our own co-op) and follow-up surveys, we’ll develop, run, and analyze our governance experiments. Some of these options will make use of blockchain technology, but member needs will dictate requirements, rather than choosing a tech stack and working backwards.

As part of our initial research, we’ll connect with umbrella organizations in our network including the Canadian Worker’s Co-operative Federation (CWCF), FACTTIC and the Platform Cooperativism Consortium to get their members’ involvement and feedback on the governance experiments.

In what form will you prototype your improvement idea? Eg: Code, reference design implementation, draft proposal shared with experts for feedback, A/B test of ideas with a test audience, prototype hardware, etc.

We’ll prototype using a collaborative workspace that outlines current and proposed governance protocols. This will be a combination of code, process design, and documentation recording the experiences of the member-workers in the governance experiments. The improvement proposal will be shared openly to facilitate these experiments’ forkability for other democratically-run organizations to use.

How will you field-test your improvement idea? Eg: run a restricted pilot at an event, simulation, workshop, etc.

We’ll start with two governance use-cases to test with our colleagues. The first is an exercise in collaborative decision-making to accomplish a small development project of creating an interactive timeline of the co-op’s history. Members will vote on which events to include in a public timeline. Additionally, we’ll explore mechanisms for distributing a performance-based bonus amongst some co-operative members. We’ll test run these decisions as small scale pilots, with the option to refine the decision-making protocol later in the year. After the initial run, we’ll collaborate with other co-operatives in our network (local/national/international) to test out tooling and process and gather additional feedback.

Who will be able to judge the quality of your output? Ideally name a few suitable judges.

Nathan Schneider
Connor Spelliscy
Patio members (international tech co-operatives consortia)

How will you publish and evangelize your improvement idea? Eg: Submit proposal to a standards body, publish open-source code, produce and release a software development kit etc.

We’ll produce a GitHub page and/or repository that can be easily remixed and added to a co-op’s handbook or any organization’s intranet, outlining the steps to running a successful distributed decision-making exercise. Building on our sector-wide outreach, we’ll submit our findings to the International Cooperative Alliance and to national co-operative bodies such as CWCF and the US Federation of Worker Cooperatives as a case study to showcase this evolution in co-operative decision-making.

What is the success vision for your idea?

We’re aiming to make more effective and participatory governance the status quo for co-operatives – and all organizations. Governance is a rare skill in many workplaces and one that is relevant to every organization (and has broader implications for civic democratic participation). Our success vision is a more informed, engaged, and democratic workforce.

[lexa]

DAO tooling in the blockchain industry is so often trustless and adversarial – totally contrary to the sort of trusting and good faith environment we try to create in a small worker co-operative. One of the criticisms of these trustless technologies I see from people outside the space is a curiosity at why one would work with people one doesn’t trust anyway – why work to find decision-making capabilities that work in a trustless environment if our human goal is to really trust one another?

Additionally, we need to figure out a mechanism for distributing a performance-based bonus amongst some co-operative members.

This is the part I feel most curious about, especially how it might work in our co-op. We have such a variety of people with different metrics for success and reward, and money is a sensitive subject no matter how you cut it. When I chat about work with my non-co-op friends, I experience suspicion and skepticism that a small workplace can effectively make sensitive decisions like this in a collaborative way. There’s no denying that having a manager make financial decisions about rewards is easier, socially speaking, that reaching consensus as a team.

Choosing to self-govern ourselves and opt into the potential conflict of collaboratively awarding bonuses feels both exciting and scary – good qualities in an experiment

We’ll produce a GitHub page that can easily be remixed and added to a co-op’s handbook, outlining the steps to running a successful distributed decision-making exercise.

I remember first researching co-ops and reading all the handbooks I could come across, fascinated by the ways of working and how openly so many tech co-ops are about their internal processes. This would be a great addition to that body of work.

[micahscopes]

This is very interesting. I’m especially interested in the voting/consensus stuff, and have been hoping to see people play with it.

I’m really into this class of voting systems that allow people give multiple choices the same weight. To me this is important for allowing people to express that two choices are both equally important to them, and lessen the risk of two choices being unnecessarily being pitted against each other in the voters minds as they deliberate.

In voting theory these are called “cardinal voting systems”. By literally allowing more information to be captured from the voter, they squeeze more expressiveness out of the same voting experience. There’s some evidence that in doing so they also reduce conundrums where people might feel a pressure to vote strategically.

Two well known cardinal voting systems are approval voting (basically just emoji voting) and STAR voting. It could be interesting to explore how these kinds of voting systems might be useful in a coop setting.

It could also be interesting to explore the role of secure multiparty computation for anonymous aggregation of peoples’ preferences. How might anonymous voting be useful/detrimental in environments where trust is valued. Is there still room for this kind of thing?

One of the criticisms of these trustless technologies I see from people outside the space is a curiosity at why one would work with people one doesn’t trust anyway – why work to find decision-making capabilities that work in a trustless environment if our human goal is to really trust one another?

From my point of view, trust is multidimensional and gradiated. There might be someone who I trust with my life but who I don’t trust to be on time for a one-on-one or to remember something I just told them. Maybe there’s someone who I’d trust to set up the mastodon server but who I wouldn’t trust to be aware or open about their lack of capacity/desire to maintain it. Some of these cryptographic tools reduce dependency on one kind of trust but in exchange create new channels for trust to be explored. E.g. secure scuttlebutt reduces the need for trusted centralize hubs but in doing so opens up new trust issues that around edits and deletions.

[andia]

Forgive the digression: the discussion around voting makes me feel the way I did when I travelled to Hawaii and realized that although we can typically get just one type of avocado in the store, there are actually dozens (hundreds?) of different types of avocados. That is, there is a whole world of voting and consensus-making options outside of the one or two options that we’re usually presented with. It’s curious how prevalent cardinal voting has become in its incarnation as emoji voting; it must fulfil a need to like all the things, rather than making a hard choice. A kind of flip side of this might be quadratic voting; it also allows for more expressiveness, but in this case you’re ‘penalized’ for expressing stronger opinions.

re: your point about anonymous voting in high trust environments; yes, I feel this is still important because social pressures come into play here and people often tend to be nice rather than fully honest in some circumstances.

[violet]

One thing I often wonder about is how financial staking translates (or not) to responsibility vis-a-vis a collective endeavour. It’s easy for someone with lots of capital to become a big stakeholder in a blockchain just to diversify their portfolio. That doesn’t mean they’ll be proactive about participating in its governance and development. Conversely, someone who has less capital on hand but invests a much larger percentage of it might find themselves with every incentive to keep the chain healthy, but without the voting power to do so.

I think a worker co-op is a great environment to model these dynamics, since you have people working across areas with different financial stakes. I’m excited for what could be unearthed by this effort. For instance, distributing the bonus: are the members who get the bonus now more staked in the project that yielded it? Does their decision-making behaviour change? Should their power change? Similarly, are those members that didn’t get the bonus now entitled to say that they’re less responsible for that project? A small co-op where everyone trusts each other feels like a place where you can observe those social dynamics play out; it’s the kind of environment where someone might honestly say “I don’t have enough bandwidth to get around to everything, and I’m choosing to drop xyz because I wasn’t in on the bonus for that project.” To me, understanding those social dynamics and how to poke them in the right direction is key to decentralized governance.

I’d be curious to know a little more about prior art. How do bigger co-ops handle things, for instance? My guess (from 0 research) is that one-member-one-vote is something that nominally applies to all decisions but is in practice only used in some cases. Sometimes a roomful of people decides something by consensus. Sometimes you have a factory floor and someone who’s empowered to make decisions that keep it safe and running. I wonder if the decision to give those people decision-making powers is documented or ad-hoc.

[1a35e1]

Super interesting PIG. Will be following.

I think worker co-ops or co-ops in general are a great mental model to help things about DAOs but it would be helpful to understand how they differ from general DAO challenges.

I think it would be a great addition to see how RW orgs practice or have evolved in their decision making and contrasting with what we currently have available to us in current on-chain or gas-less solutions.

[Nirvana]

In some DAOs where people are keen to experiment with governance, they govern each other for the sake of governance, but lack of business.

When they want to help other orgs develop, they will face the obstacle of their solid habit and the unmatched business scenario.

What do you think?

[1a35e1]

I think governing each other is misplaced, most people are not qualified to govern which is why its fundamental for DAOs to create clear lines of accountability and have each domain manage its own mandate.

I like to think of DAOs as network topologies. Its really about how effectively can we transmit information throughout the network.

There is no one “best” way to setup your network however, and in reality we use or evolve a topology as our needs grow.

[isthisa]

Exciting proposal - I’d love to see experiments/testing with some other groups, besides Hypha during the pig period if possible. I know there are info-sharing networks for a number of tech coops, maybe something like a play-testing session could happen, or more standard feedback sessions?

[andia]

This is great point; there are lots of differences between DAOs and co-ops. I’ve written about some of the points of difference (and similarity) in this post that compares them using the framework of the co-operatives principles. It’s a few years old now, but still relevant I think Dripline: ‘Staking’ identities: looking at the practicalities of transforming DAOs into co-ops | Hypha Worker Co-operative

[andia]

Agreed that governance for the sake of governance isn’t useful. It absolutely needs to be rooted in real world decisions (and ideally, of some consequence) to be valuable. The business acumen piece is equally complicated though; some people are more entrepreneurial than others either because of experience or personality. Having strategic business planning tied to governance might be one way of getting around this issue so the two pieces are interlocked and not at odds with one another.

[andia]

Good point, thanks. I agree the scope needs to be broader and have edited the proposal to include more connections with co-op federations and similar types of umbrella organizations.

[1a35e1]

Great article.

I did a talk last year ~Nov23)that also broached this topic with a similar perspective to a VERY different audience.

2311-sxtech-keynote_v4.pdf

[Rithikha]

Really interesting proposal – the fact that you guys have Hypha to field test directly is amazing and I’m glad to see you’re also planning to reach out to/collaborate with some international and national cooperative bodies. This feels like a protocol that’s worth taking a look at and redesigning especially with remote work and more distributed teams coming online.

I don’t have the article on hand, but I was recently reading a McKinsey study about how the average lifespan of a traditional S&P company is about 60 years and how in comparison cooperatives outlive almost all of them. It feels like coops are about to become a new paradigm for work, not just because they’re fairer/ideologically resonating with people, but quite literally because they work better and are more resilient in the long run. This would be a great applied inquiry to speed up this shift!

[andia]

Made a few final edits to be clearer about how we see co-operatives as a protocol, and to nod to how our proposal connects to larger concepts of democratic literacy. Thanks to everyone for reading and commenting! Your feedback and thoughts have been very valuable.