3. Organisational democracy

Definition

Organisational democracy (OD) refers to a concept of structurally anchored, substantive participation, in particular of workers/employees, i.e. in strategic, operational and tactical decisions. These broad-based and institutionalised worker/employee-influenced processes are not ad hoc or occasional in nature, and the majority of employees generally participate

  • In a form of institutionalised and binding involvement (mandatory joint consultation) or decision-making (i.e., codetermination with equal representation or collective self-determination)
  • In operational decisions (medium-term decisions with high importance for parts of the enterprise) or strategic decisions (long-term decisions with high importance for the whole company)
  • About issues at the organisational level (a large unit, plant, corporation, etc.).
  • Employees participate either directly (within meetings or general assemblies) or indirectly through their representatives who are elected or appointed to a representative board/committee
  • May (optional criterion) hold a share in their organisation’s equity capital

Context

The concept of Organisational democracy was originally developed with regard to the structurally anchored participation of workers in tactical, strategic and operational decisions. These might be employees or cooperative co-owners. Since the Social Economy is multi-faced, organisational democracy in the social economy goes beyond workers/employees, including other users and additional stakeholders (ranging from information and consultation to co-determination to joint decision-making). Where, for example, users (such as persons with disabilities) run and own a care cooperative and employ their caretakers, strategic decision-making lies with the user members, while workers’ voices also need to be structurally anchored where decisions affect them (at least by a works council). 

Organisational democracy additionally requires a specific, positive socio-moral climate of mutual care and caring (together) with (others) in terms of democracy as a way of life that goes beyond formal decision-making procedures. Mutual respect, care, trust and other key qualities – of how members of a cooperative (or another Social Economy organisation) treat each other – sustain formal democratic decision-making. 

In Dices

DICES investigates Organisational democracy in Social Economy Organisations. The project conceptualises Economic Democracy and Organisational Democracy within the Social Economy (WP2), analyses organisational democracy and social dialogue in the Social Economy e.g. by comparing different social economy ownership models and degrees of organisational democracy and by studying the use and effectiveness of organising approaches in the Social Economy, develops a policy brief on organisational democracy (WP4), and tests new democratic practices through local pilot actions (WP6). 

See also

Key reference

Weber, W. G., Unterrainer, C., & Höge, T., (2020). Psychological research on organisational democracy: A meta-analysis of individual, organisational, and societal outcomes. Applied Psychology: An International Review, 69(3). 1009-1071.