Report on COG to EFES Experts Meeting December 8

First organized in 1997, at a conference of the National Center for Employee Ownership, the Capital Ownership Group (COG) is a network of lawyers, accountants, bankers, economic development loan fund staff, government economists and economic development staff, academics, international agency staff, labor union leaders and members, investment bankers, employee owners from CEOs to workers, and community leaders, and policymakers who’s mission is to:

· Expand opportunities for people to realize their productive and creative potential;

· Stabilize local communities by improving living standards; and enhance the quality of life for all.

3) Find out what the public knows and cares about concerning capital concentration, the problems it generates, and the public’s perception of broad ownership schemes as a potential solution.

4) Find out what opinion makers know and care about concerning capital concentration, the problems it generates, and the opinion makers’ perceptions of broad ownership schemes as a potential solutions

7) Provide solid data and policy proposals supporting our mission to policy makers, opinion makers, the media and the general public.

8) Create and enhance examples and models of co-ordinate broad ownership systems.

b) To assist local organizations create policy or programs to broaden ownership.

10) Co-ordinate policy development in many countries to create policies that raise the social wage floor, without sacrificing development opportunities for poor countries.

11) Develop policy alternatives that work for common people in developed and developing countries.

C. COG’s first concrete project was its Virtual Conference Center/Think Tank created with initial Ford Foundation Grant

With funding from the Ford Foundation beginning in April of 1999, COG is building and serving this international network. COG runs a web site conference center (virtual think tank) hosting electronic discussions on how employee ownership and other policies and practices can help alleviate the negative aspects of globalization. COG’s library and discussion groups serve as resources for policymakers dealing with the challenges of an increasingly global economy. Discussions include description and critiques of current methods, and discussion of new policy options.

The virtual conference center currently has eight working group meeting rooms. Discussions are moderated by the COG Chair and employee ownership attorney Deborah Olson, and other project staff, Prof. John Logue, Dan Bell, Prof. Jacqueline Yates, and Steve Clem of the Ohio Employee Ownership Center at Kent State University. Participants have begun moderating a number of other discussion groups. These include: the India discussion, moderated by Umesh Gala, an accountant in Bombay, India; the Economics of Ownership discussion, moderated by Keith Wilde, an economist for the Canadian federal pension system; the Spanish language discussion section moderated by Maria Adela Oliveros de Miranda, Executive Director of RORAC, a Mexican community economic development foundation; and the Russian language discussion group moderated by Olga Klepikova, an OEOC staff member in Moscow, Russia. A new discussion group for labor union leaders in being organized by Victor Thorpe, the immediate past General Secretary of the International Confederation of Chemical Workers Unions (ICEM), headquartered in Belgium. Participants are welcome to organize working groups around a variety of topics.

A. Web Architecture and Languages

At Kent State University’s computer center, COG has a dedicated server computer, on which we are running web server software. We have a mailing list manager (enabling the group discussions). We have the web archives. We have a chat server. We are considering options to enable direct voice discussions.

The basic COG website architecture can be navigated in English, Spanish, Russian and Chinese. There are articles in the library in a variety of languages. We are still debating the wisdom of attaching a computer translation program to the website.

B. Statistics on Participation in Discussions and Utilization of Library and Archives

The web site virtual think tank architecture is in place and working. We have all of the six active discussion/work (“privatization”, “homestead”, and “national”, “international”, “sub-national” and economic theory offshoot group “ownership”.

. We have 268 participants in the network, of whom around 40 are frequent participants in discussions. The others are passive observers. We have a growing library of books and articles from a variety of authors and have links to 34 other web resources on broadening ownership. Based on our web tracker, a much larger number of people are retrieving documents from the library. Since going on-line in July 1999, monthly hits on our web site have grown substantially almost every month. As of November 29, 2000, we had received 111,637 total requests for information, with 16,044 of them in October 2000. They have come from 81 countries from Australia to Zimbabwe. Since inception 1,581 files in the archives and library have received 20 or more requests, of which the top eight received over 1,000 requests each. We have had several real time on-line executive committee meetings and on-line discussion group meetings. (The full statistical report on utilization of the web site is available at http://cog.kent.edu/analog.)

We reach out to the networks of our participants and receive inquiries from people, media and institutions around the globe. We are developing a number of potential partnerships. We are discussing potential joint projects with the Georgetown University Law Center, the National Center for Employee Ownership, the Civil Society Institute, European Federation of Employed Shareholders (EFES) in developing policy for the European, community employee ownership proponents in India, and the Roberto Oliveros Rivas Foundation (RORAC), the educational arm of a national labor and cooperative development organization in Mexico, and the Council for Hometown Jobs and Growth.

We have created matrices outlining employee ownership law, policy and privatization practices around the globe.

We have begun Spanish and Russian language discussion groups and hope to start discussions and provide documents in other languages. A French professor, who has recently published a substantial volume or articles on employee ownership volunteered to moderate our French language discussion, which will be in progress shortly. We have several volunteer translators, primarily from the religious community. We have found that electronic translation is useless for the complexity of the ideas involved in our work. We are pursuing other resources at Kent State University to assist in translation work.

C. Discussions Groups and Papers

Ownership for All is the initial compilation (approximately 150 pages) of the first 18 months of work by the Capital Ownership Group (COG) virtual think tank. It includes reports of six working groups. Each paper is a work in progress. Each discussion group is on going. There is a substantial on-line library comprised of many publications that are or have been under active discussion. Our goal is to develop policies, practices, implementation strategies and mechanisms to facilitate the creation of sound, practical means for local empowerment and economic self-sufficiency globally. Our current method is to expand the COG network to include all major organizations and policy makers concerned with those goals in working groups to develop the means to those ends.

We have created matrices outlining employee ownership law, policy and privatization practices around the globe.

· Cataloging and discussing best practices in employee ownership policies currently used at the international, national and sub-national level; including tax, technical assistance and subsidized loan policies, and laws which merely enable employee ownership without assisting it;

· Discussing uses and misuses of employee ownership in privatization policies, toward develop best practices criteria in this much-abused area;

· Proposing new policy initiatives for governments and novel methods of structuring ownership rights for adoption by companies under present laws.

· Proposing research projects to determine the social significance of ownership patterns to the status of women, working families and the economically disadvantaged;

· Discussing the role international agencies and trade policies play in affecting ownership patterns, and the potential role these agencies and policies might play to change ownership patterns and provide working people a greater chance at economic sustenance and improve civil society;

· Creating concrete proposals for use by those critical of the international system of credit to developing countries, the IMF and World Bank

Each of the papers is available on the website and can be accessed directly from the COG homepage at http://cog.kent.edu.

Independent publication of the Ownership for All papers include summaries of three of the six articles in the September 2000 issue of Business Ethics magazine and requests for republication of that same material on the website of the Corporation for Enterprise Development (CFED). These were both based on outside requests. An organized effort at broad dissemination of these papers will begin in 2001.

D. Anecdotal Success stories

Our participants include lawyers, accountants, bankers, economic development loan fund staff, government economists and economic development staff, academics, international agency staff, labor union leaders and members, investment bankers, and employee owners from CEOs to workers.

They are cataloging and discussing best practices in employee ownership policies currently used at the international, national and sub-national level; including tax, technical assistance and subsidized loan policies, and laws that merely enable employee ownership without assisting it.

They are discussing uses and misuses of employee ownership in privatization policies, toward develop best practices criteria in this much-abused area.

They are proposing new policy initiatives for governments and novel methods of structuring ownership rights for adoption by companies under present laws. They are proposing research projects to determine the social significance of ownership patterns to the status of women, working families and the economically disadvantaged.

They are discussing the role international agencies and trade policies play in affecting ownership patterns, and the potential role these agencies and policies might play to change ownership patterns and provide working people a greater chance at economic sustenance and improve civil society.

Through COG, Shann Turnbull, Australian investment banker and employee ownership proponent has carried on a discussion with David Ellerman, Senior Advisor to the Chief Economist of the World Bank, and others about several topics regarding changing the role of the World Bank as a lender into that of a consultant teaching developing countries to develop self-financing mechanism. In November 2000, Turnbull and Ellerman met with World Bank CEO, James Wolfenson and the Bank’s chief economist to discuss this topic and Turnbull’s proposal, supported by Ellerman, that the Bank promote Ownership Transfer Corporations (OTC’s). OTC’s are explained in the COG Homestead paper and in several of Mr. Turnbull’s papers in the COG library.

Julia Markus of the Canadian Employee Share Ownership and Investment Association, who has been working with Canadian MPs interested in creating ownership broadening legislation, trades information with Carla Dickstein, Research Director of Coastal Enterprises Inc., and recent appointee to the Maine State Commission on Ownership, concerning ongoing efforts in Canada and Maine to develop new ownership broadening policies. Both of them use proposals created by Atty. Deborah Olson on providing sliding scale tax benefits based on quantity and quality of employee ownership, and/or communities insisting on obtaining a stock quid pro quo in exchange for government largesse to companies. These ideas have been discussed in a variety of forms in the COG Homestead group.

Various participants suggested looking at the Swedish Meidner proposals for countrywide share ownership through the pension system. Per Ahlström, currently executive director of the Swedish effort to create labor venture funds, and Prof. John Logue of Kent State University, provided both a description of and the political history of the demise of the Meidner Plan.

Working economists (including among others moderator, Keith Wilde, a senior economist for the Canadian government pension system and Michael Harrington of the Milken Institute) who favor broad ownership have been debating with Louis Kelso’s devoted followers whether Kelso’s theories are useful to furthering the ends of broadening ownership in the practical world. David Ellerman, Economic Advisor, Development Economics for the World Bank, has propounded his residual claimancy theory regarding the allocation of property rights, and has made his new book available in the COG library.

Shann Turnbull, Australian investment banker and employee ownership theorist and practitioner, has provided numerous articles to the COG library and been an active discussant, propounding models for companies governed by stakeholders where investor rights are time limited and devolve to those who continue to create wealth for the company.

Vic Thorpe, Brussels based former General Secretary (and current Senior Advisor) of ICEM (International Federation of Chemical, Energy, Mine & General Workers' Unions - 21 million organized members in 350 member unions from 135 countries) has initiated an on-line class where labor leaders will study the uses of employee ownership on a case study basis. Vic is also building an international network of consultants to labor and the social sector under the trade name 'Just Solutions' which may help develop other programs with COG.

RORAC, which is creating a cooperative to build small agricultural dams in rural Mexico, found Israeli agronomists with appropriate expertise to assist them through COG.

Thomas Brandt, an economic development employee of the State of Hawaii provided an essay on his dream for Hawaii, and has proposed many tax, income and social security based ideas on broadening ownership.

Political Science Prof. Alan Zundel (University of Nevada), who created the Institute for the Public Good based on his interest in ownership based strategies to promote social justice, has proposed numerous non-employee ownership ideas for broadening ownership to the Homestead group, and has co-authored the Homestead discussion summary.

III. Partially Funded Objectives for Years 2000 – 2002

The Ford Foundation has approved refunding that was scheduled to begin as of October 1, 2000 (but for we do not yet have the contract, and are thus unsure of the actual starting date) to do the following:

A. The network will develop 24 to 36 new mutual hot links to significant institutions and organizations. The number of countries linked will be doubled from the current 11 to at least 20.A staff person will focus primarily on wholesale outreach to create mutual links and foster joint discussions and projects with existing networks [1] of labor organizations and their think tanks, socially conscious business groups, employee owned business and non-profit groups, foundations, think tanks, university researchers, community development financial institutions, foundations and advocacy groups focusing on economic justice, civil society, environmental sustainability, globalization, ownership, local economic empowerment and the role of transnational institutions.

B. Registered network participation will increase by 75 to 100 new participants.

C. Five new discussion, policy, research or project groups will be developed with at least three of the moderators coming from outside the current COG participant group. We will be able to pay five non-staff moderators to moderate new discussions.

D. COG library will quintuple to at least 400 titles and 125 authors. The library will add an electronic subject index.

E. Requests to the website will average 8,000 to 10,000 per month in the first year and 10,000 to 15,000 per month in the second year.

F. COG will obtain funding from at least two funders other than the Ford Foundation for projects, research or policy groups developed by the network.

G. COG will itself publish, or cause existing publications to publish five articles or papers arising from its discussion groups.

H. Two conferences will be organized. The first will produce more concrete future directions for COG growing out of the papers it has produced thus far. The second will introduce COG’s policy ideas to the broader policy community potentially interested in this area and to selected policy makers and their staff.

I. COG will co-sponsor a publication or event with one of its new institutional partners bringing broadened ownership ideas to a new audience.

We need to raise an additional $25,000 to fund travel for international participants in our proposed 2002 international broad ownership policy conference. We also plan to raise funds to implement pilot projects on a number of policy ideas proposed within COG.

Per Åhlström, Editor-in-Chief of Nya Norrland and Chairman of the LO/Social Democratic Employee Ownership Commission

COG's Working Group is an unincorporated network of employee ownership experts and practitioners from many walks of life, initially established as a committee of the National Center for Employee Ownership (NCEO).

COG's Working Group provides both policy research and policy dissemination capacity. It includes many of the most knowledgeable practitioners in employee ownership and researchers in the field. Its members are:

Dan Bell, International Program Coordinator, Ohio Employee Ownership Center, Kent State University

Bruce Householder, Ex.Dir., Worker Ownership Institute, United Steelworkers of America

James Keogh, Department of Community Trade & Economic Development, State of Washington

Julia Markus, Exec. Director, Employee Share Ownership and Investment Assoc. of Canada

Marc Mortier, Secretary General, Institute pour la Participation dans l'Enterprise

Viktor B. Supyan, Deputy Director, Institute of the USA and Canada, Russian Academy of Sciences

Lynn Williams. Retired President United Steelworkers of America, and Co-Chair, Worker Ownership Institute

COG’s Advisory Board for this Project, in addition to those mentioned above includes:

[1] These include the network of labor think tanks such as the Economic Policy Institute in the US, NALEDI in South Africa, DSA in Brazil, the ILO Bureau of Employment Security, the Center for Working Capital, the CDFI network, the Heartland Industrial Forum, the Shared Capitalism Institute, Sustainable America, the Social Venture Network, the international network of employee ownership organizations creating a joint database on equity compensation for transnational corporations, International Cooperative Federation, the International Forum on Globalization, the Bretton Woods Project, CFED, ISLR and the networks of local government leaders they serve seeking new policy ideas, to name a few.

Report on Capital Ownership Group (COG)

to

EFES Experts Meeting

December 8 –9,2000, Paris

COG Chair and Project Co-coordinator of COG/OEOC/Ford Foundation Program

And

John Logue

Director OEOC and Principal Investigator COG/OEOC/Ford Foundation Program

I. Introduction

A. Web Architecture and Languages

C. Discussions Groups and Papers

D. Anecdotal Success stories

III. Partially Funded Objectives for Years 2000 – 2002