Power - Stakeholders and Co-determination

• The NEDO (National Economic Development Organisation) in the UK illustrates the corporatist tradition. "Corporatism" involves different parties contributing from their own power base. Representatives of government, business and unions met to examine industrial matters of mutual concern.
• The Callaghan administration's 'Social Contract' in the 1970's institutionalised tri-partite decision-making between UK government, employer groups and the trade unions.
• Tony Blair's 1995 statements about the "stakeholder society" are in the corporatist tradition notwithstanding that the Social Contract collapsed in the "Winter of Discontent" and Neddies were seen by many as ineffective talking-shops.

Co-determination, Stakeholders and the Social Chapter
In post-war Germany as a political defence against against communism, co-determination was defined in the constitution to balance the tension between owners and employees. Coal and steel industry firms were required to set up elected supervisory boards (five shareholders and five employees with an eleventh elected). This board appoints a executive board (two business specialists and a trade unionist) to manage operations.Similar power-sharing structures (worker directors) can be found in Scandinavia. Today, the Social Chapter of the Maastricht agreement promotes the establishment of Works Councils. How can the effectiveness of such structures be evaluated?

The Bullock report to the Callaghan administration in the mid-70's proposed supervisory board structure for UK industry. However trade unions were unwilling to "join management" and resign their traditional, adversarial role thus, they argued, compromising their ability to challenge managerial action. Business policy can be criticised openly from opposition as a countervailing force constraining the other side. Involvement in company decision-making where sensitive business information is involved - the need to conceal this from commercial rivals also restricts the ability to communicate it to those who have elected you to office. The open government problem conflicts with the pragmatism of market force ethically delivered or not.

Opposition to co-determinism is as political as encouraging it. The scope for worker democracy is constrained by managerial/ownership purposes and the political interests of workers themselves. In works councils sharing in decisions may be limited to non-strategic items (training, health and safety, welfare support, community projects etc) and exclude e.g. closures, acquisitions and divestments, major funding and re-structuring.