WHAT DO MONDRAGON COOPITALIST MULTINATIONALS LOOK LIKE? THE RISE AND FALL OF FAGOR ELECTRODOMESTICOS S. COOP. AND ITS EUROPEAN SUBSIDIARIES

Anjel Errasti, Ignacio Bretos and Enekoitz Etxezarreta

Annals of Public and Cooperative Economics, 2016, vol. 87, issue 3, 433-456

Abstract: The Mondragon Cooperative Group reflects the effort to combine the basic objectives of business development in international markets with job creation, the use of democratic methods in the organisation of the business and a commitment to the development of its surrounding community. The multi-nationalisation of Mondragon cooperatives entails new dilemmas, paradoxes and contradictions regarding these objectives. This article analyses the case of the Mondragon cooperative-multinational Fagor Electrodomesticos. Following years of international expansion via foreign direct investment, the recent recession forced Fagor to institute radical job restructuring processes, both in the plants of the parent company in the Basque Country and in its European subsidiaries: the French company Fagor-Brandt and the former communist Polish firm Wrozamet. Finally, the Basque domestic appliance company, Fagor, declared bankruptcy in November 2013. Analysing the economical and organizational problems during the downfall of Fagor, and the measures taken to downsize employment in the Basques factories and in the foreign subsidiaries, helps us further our knowledge about the organisational characteristics of the Mondragon multinationals and reflect on the possibilities of extending the cooperative model to subsidiaries.

Date: 2016
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