Common ownership
Common ownership is a principle according to which the assets of an enterprise
A business is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit...

 or other organization are held indivisibly rather than in the names of the individual members or by a public institution such as a governmental body. It is therefore in contrast to public ownership. Thus, rather than being “owners” of the enterprise, its members are held to be trustee
Trustee is a legal term which, in its broadest sense, can refer to any person who holds property, authority, or a position of trust or responsibility for the benefit of another...

s of it and its assets for future generations. Common ownership is a way of “neutralising” capital
Capital (economics)
In economics, capital, capital goods, or real capital refers to already-produced durable goods used in production of goods or services. The capital goods are not significantly consumed, though they may depreciate in the production process...

, and vesting control of an enterprise by virtue of participation in it, rather than by the injection of capital.

Many socialist movements advocate common ownership of the means of production
Means of production
Means of production refers to physical, non-human inputs used in production—the factories, machines, and tools used to produce wealth — along with both infrastructural capital and natural capital. This includes the classical factors of production minus financial capital and minus human capital...

 as an eventual goal or outcome of development of the productive forces. Socialists make the distinction between collective ownership (such as corporate/private ownership and state ownership) and common property.

In political philosophy
Political philosophy
Political philosophy is the study of such topics as liberty, justice, property, rights, law, and the enforcement of a legal code by authority: what they are, why they are needed, what, if anything, makes a government legitimate, what rights and freedoms it should protect and why, what form it...

, common ownership refers to joint or collective ownership by all individuals in society. Common ownership of the means of production is advocated, or asserted, by communism and some forms of socialism. Common ownership differs from collective ownership. The former means property open for access to anyone, and the latter means property owned jointly by agreement. Examples of collective ownership include modern forms of corporate ownership as well as producer cooperatives, which are in contrast to forms of common ownership, such as a public park available to everyone.

Common ownership of land is an example of customary land ownership in tribal societies which predates and runs simultaneously to the arrangement of colonised alienated land
Alienated land
Alienated land is that which has been acquired from customary landowners by Government, either for its own use or private development requiring a mortgage or other forms of guarantees. The term refers historically to the appropriation of customary land by European colonial powers. Land was...

. Tribes and families living on the land have common ownership through tradition
A tradition is a ritual, belief or object passed down within a society, still maintained in the present, with origins in the past. Common examples include holidays or impractical but socially meaningful clothes , but the idea has also been applied to social norms such as greetings...


History of common ownership

Before the Neolithic Revolution
Neolithic Revolution
The Neolithic Revolution was the first agricultural revolution. It was the transition from hunting and gathering to agriculture and settlement. Archaeological data indicates that various forms of plants and animal domestication evolved independently in 6 separate locations worldwide circa...

, tribe
A tribe, viewed historically or developmentally, consists of a social group existing before the development of, or outside of, states.Many anthropologists use the term tribal society to refer to societies organized largely on the basis of kinship, especially corporate descent groups .Some theorists...

s practiced collective ownership of all assets, which preceded private ownership. The Native Americans
Indigenous peoples of the Americas
The indigenous peoples of the Americas are the pre-Columbian inhabitants of North and South America, their descendants and other ethnic groups who are identified with those peoples. Indigenous peoples are known in Canada as Aboriginal peoples, and in the United States as Native Americans...

 practiced the collective ownership of land. Robert LeFevre
Robert LeFevre
Robert LeFevre was an American libertarian businessman, radio personality, and primary theorist of autarchism.-Early life:...

 argued that collective ownership of land started to wither since the start of farming in Egypt
Egypt , officially the Arab Republic of Egypt, Arabic: , is a country mainly in North Africa, with the Sinai Peninsula forming a land bridge in Southwest Asia. Egypt is thus a transcontinental country, and a major power in Africa, the Mediterranean Basin, the Middle East and the Muslim world...

 and the Middle East
Middle East
The Middle East is a region that encompasses Western Asia and Northern Africa. It is often used as a synonym for Near East, in opposition to Far East...

. In Marxist theory, this form of ownership is called Primitive communism
Primitive communism
Primitive communism is a term used by Karl Marx and Friedrich Engels to describe what they interpreted as early forms of communism: As a model, primitive communism is usually used to describe early hunter-gatherer societies, that had no hierarchical social class structures or capital accumulation...

 because it was based on common ownership on a subsistence level.

Common ownership and socialism

Various socialist movements (especially libertarian socialism
Libertarian socialism
Libertarian socialism is a group of political philosophies that promote a non-hierarchical, non-bureaucratic, stateless society without private property in the means of production...

) advocate common ownership of the means of production by all of society, although sometimes socialists classify socialism as public ownership of the means of production and define upper-stage socialism, or pure communism, as common ownership of the means of production and a classless society based upon a superabundance of goods and services. Public or state ownership of industry is viewed as a temporary measure during the transition from capitalism to socialism which eventually is displaced by common ownership of industry as state authority becomes obsolete when the distinction between classes evaporates. However, common ownership in a hypothetical socialist society is distinguished from primitive forms of common property that have existed throughout history, such as communalism
Communalism is a term with three distinct meanings according to the Random House Unabridged Dictionary'.'These include "a theory of government or a system of government in which independent communes participate in a federation". "the principles and practice of communal ownership"...

 and primitive communism
Primitive communism
Primitive communism is a term used by Karl Marx and Friedrich Engels to describe what they interpreted as early forms of communism: As a model, primitive communism is usually used to describe early hunter-gatherer societies, that had no hierarchical social class structures or capital accumulation...


It is the practical application of the socialist desire to achieve the “common ownership of the means of production” (see Clause IV
Clause IV
Clause IV historically refers to part of the 1918 text of the British Labour Party constitution which set out the aims and values of the party. Before its revision in 1995, its application was the subject of considerable dispute.-Text:...

). Its purpose, by preventing control being obtained through the purchase of a company’s share capital, is to ensure that the founders’ aims are pursued in perpetuity. This is particularly desirable to the founders of a workers’ co-operative, who, inspired by solidarity and the desire to create fulfilling employment, will typically build the business up through hard and low-paid work (misleadingly called “sweat equity
Sweat equity
Sweat equity is a term that refers to a party's contribution to a project in the form of effort --- as opposed to financial equity, which is a contribution in the form of capital....

”). They may out of a sense of fairness wish to hinder future generations of employees, or their heirs, from winding up the co-operative so as to be able to share the sale proceeds among themselves (see asset stripping
Asset stripping
Asset stripping involves selling the assets of a business individually at a profit. The term is generally used in a pejorative sense as such activity is not considered productive to the economy. Asset stripping is considered to be a problem in economies such as Russia or China that are making a...


In practice

Common ownership is practised by large numbers of voluntary associations and non-profit organizations, by all charities, as well as implicitly by all public bodies. Most co-operatives have some element of common ownership, but some part of their capital may be individually owned.

A very significant early influence on the movement has been the Scott Bader Commonwealth, a composites and speciality polymer plastics manufacturing company in Wellingborough
Wellingborough is a market town and borough in Northamptonshire, England, situated some from the county town of Northampton. The town is situated on the north side of the River Nene, most of the older town is sited on the flanks of the hills above the river's current flood plain...

, Northamptonshire
Northamptonshire is a landlocked county in the English East Midlands, with a population of 629,676 as at the 2001 census. It has boundaries with the ceremonial counties of Warwickshire to the west, Leicestershire and Rutland to the north, Cambridgeshire to the east, Bedfordshire to the south-east,...

, which its owner, Ernest Bader, gave to the workforce in installments through the late 1950s to early 1960s. (Contrary to the popular concept of common ownership organisations as being small organisations, this is a high-technology chemical manufacturer whose turnover has exceeded £100 million per annum since the early 1990s with a workforce of hundreds.)

In London, Calverts is another rare example of an established worker co-operative with a policy of pay parity. The John Lewis Partnership
John Lewis Partnership
The John Lewis Partnership is an employee-owned UK partnership which operates John Lewis department stores, Waitrose supermarkets and a number of other services...

 is probably the most famous example of a worker co-operative, albeit one without pay parity. From the collective movement, the most significant experience is probably Suma Wholefoods in Elland, West Yorkshire

History of the movement

The principle was adopted by the “new wave” workers’ co-operative movement during the 1970s, and continues into the present day, although it is less common. In 1976, the British Parliament passed the Industrial Common Ownership Act (“ICO Act”), which gave £100,000 of "seed" funding to the Industrial Common Ownership Movement (ICOM) and £50,000 to the Scottish Co-operative Development Committee (SCDC), respectively. ICOM was fueled by three strands of thought–Christian socialism, workers’ control and “rice and sandals” alternativism–and successfully promoted the creation of over 2,000 worker’s co-operatives, before merging in 2001 with the Co-operative Union to form Co-operatives UK, thus, reuniting the worker co-operative and consumer co-operative sectors.

In parallel, the growth of some 60 local co-operative development agencies (CDAs), supported by local authorities, gave on-the-spot start-up assistance to groups wanting to create a co-operative. Some local retail co-operative societies were also active. By combining personal, community and business development, this movement brought many disadvantaged people the opportunity to go into business for themselves on the basis of economic democracy, equal opportunities and social inclusion.

Finance: The ICO Act also established a £250,000 rotating loan fund managed by Industrial Common Ownership Finance Ltd (ICOF). ICOF — since 2005 trading as Co-operative and Community Finance- has grown steadily and now manages a range of funds totalling some £4.5 million. Some of these have been endowed by public bodies and others raised through public subscription. This was the start of the ethical investment movement in Britain.

Currently, as signalled by the British Labour Party’s abandonment of “clause 4” of its constitution, which called for common ownership and was printed on party membership cards, ideology has given way to pragmatism, and the social enterprise
Social enterprise
A social enterprise is an organization that applies business strategies to achieving philanthropic goals. Social enterprises can be structured as a for-profit or non-profit....

 movement focuses on outcomes rather than structures.

UK law

The principle is typically implemented through inserting two clauses in a company’s Memorandum of Association
Memorandum of Association
The memorandum of association of a company, often simply called the memorandum , is the document that governs the relationship between the company and the outside...

, or an industrial and provident society
Industrial and Provident Society
An industrial and provident society is a legal entity for a trading business or voluntary organisation in the United Kingdom, the Republic of Ireland, and New Zealand...

’s rules.
  • the first provides that the company’s assets shall be applied solely in furtherance of its objectives and may not be divided among the members or trustees.
  • the second provides for "altruistic
    Altruism is a concern for the welfare of others. It is a traditional virtue in many cultures, and a core aspect of various religious traditions, though the concept of 'others' toward whom concern should be directed can vary among cultures and religions. Altruism is the opposite of...

     dissolution”, whereby if the enterprise is wound up, remaining assets exceeding liabilities shall not be divided among the members but shall be transferred to another enterprise with similar aims or to charity.

British law has been reluctant to entrench common ownership, insisting that a three-quarters majority of a company’s members, by passing a “special resolution”, have the right to amend a company’s memorandum of association. However such entrenchment has been written into the Community Interest Company (CIC), a new legal status that was introduced in 2005.

This three-quarters majority above applies to all limited companies, whereas it is possible to entrench altruistic dissolution in an industrial and provident society, whether a 'bona fide co-operative' or a 'society for the benefit of the community' ('bencom').

See also


  • Co-determination
    Co-determination is a practice whereby the employees have a role in management of a company. The word is a literal translation from the German word Mitbestimmung. Co-determination rights are different in different legal environments. In some countries, like the USA, the workers have virtually no...

  • Commons
  • Commune
    Commune (socialism)
    Traditionally, the revolutionary left sees the Commune as a populist replacement for the elitist parliament. The far-left, despite their differences, agree that the commune would have several features...

  • Industrial Relations
  • Industrial Workers of the World
    Industrial Workers of the World
    The Industrial Workers of the World is an international union. At its peak in 1923, the organization claimed some 100,000 members in good standing, and could marshal the support of perhaps 300,000 workers. Its membership declined dramatically after a 1924 split brought on by internal conflict...

  • New Unionism
    New Unionism
    New Unionism is a term which has been used twice in the history of the labour movement, both times involving moves to broaden the trade union agenda.-1880s:First was the development within the British trade union movement in the late 1880s...

  • Workers' control
    Workers' control
    Workers' control is a term meaning participation in the management of factories and other commercial enterprises by the people who work there. It has been variously advocated by anarchists, socialists, Communists, Social Democrats and Christian Democrats, and has been combined with various...

  • Workers' cooperative
  • Workers' council
    Workers' council
    A workers' council, or revolutionary councils, is the phenomenon where a single place of work or enterprise, such as a factory, school, or farm, is controlled collectively by the workers of that workplace, through the core principle of temporary and instantly revocable delegates.In a system with...

  • Workers' self-management
  • Workplace democracy
    Workplace democracy
    Workplace democracy is the application of democracy in all its forms to the workplace....

  • Anton Pannekoek
  • Communalism
    Communalism is a term with three distinct meanings according to the Random House Unabridged Dictionary'.'These include "a theory of government or a system of government in which independent communes participate in a federation". "the principles and practice of communal ownership"...

  • Communism
    Communism is a social, political and economic ideology that aims at the establishment of a classless, moneyless, revolutionary and stateless socialist society structured upon common ownership of the means of production...

  • Communitarianism
    Communitarianism is an ideology that emphasizes the connection between the individual and the community. That community may be the family unit, but it can also be understood in a far wider sense of personal interaction, of geographical location, or of shared history.-Terminology:Though the term...

  • Council Communism
    Council communism
    Council communism is a current of libertarian Marxism that emerged out of the November Revolution in the 1920s, characterized by its opposition to state capitalism/state socialism as well as its advocacy of workers' councils as the basis for workers' democracy.Originally affiliated with the...

  • Democratic socialism
    Democratic socialism
    Democratic socialism is a description used by various socialist movements and organizations to emphasize the democratic character of their political orientation...

  • Georgism
    Georgism is an economic philosophy and ideology that holds that people own what they create, but that things found in nature, most importantly land, belong equally to all...

     / Geoism - common ownership in land only
    • Geolibertarianism
      Geolibertarianism is a political movement that strives to reconcile libertarianism and Georgism .Geolibertarians are advocates of geoism, which is the position that all natural resources – most importantly land – are common assets to which all individuals have an equal right to access; therefore if...

       / Geoanarchism
  • Libertarian Socialism
    Libertarian socialism
    Libertarian socialism is a group of political philosophies that promote a non-hierarchical, non-bureaucratic, stateless society without private property in the means of production...

    • Anarchist economics
      Anarchist economics
      Anarchist economics is the set of theories and practices of economics and economic activity within the political philosophy of anarchism.-Early views:...

    • Mutualism
      Mutualism (economic theory)
      Mutualism is an anarchist school of thought that originates in the writings of Pierre-Joseph Proudhon, who envisioned a society where each person might possess a means of production, either individually or collectively, with trade representing equivalent amounts of labor in the free market...

    • Participatory democracy
      Participatory democracy
      Participatory Democracy, also known as Deliberative Democracy, Direct Democracy and Real Democracy , is a process where political decisions are made directly by regular people...

  • Non-property system
    Non-property System
    A Non-property system is the name of an economic system appearing in the futuristic fictional books and short stories by Iain Banks called the Culture series, in which there is no concept of property. No individual or group is given superior rights to control any particular resource...

  • Syndicalism
    Syndicalism is a type of economic system proposed as a replacement for capitalism and an alternative to state socialism, which uses federations of collectivised trade unions or industrial unions...

  • Pure communism

  • Capitalism
    Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...

    • Anarcho-capitalism
      Anarcho-capitalism is a libertarian and individualist anarchist political philosophy that advocates the elimination of the state in favour of individual sovereignty in a free market...

    • Laissez faire
    • Corporate capitalism
      Corporate capitalism
      Corporate capitalism is a term used in social science and economics to describe a capitalist marketplace characterized by the dominance of hierarchical, bureaucratic corporations, which are legally required to pursue profit....

    • Social democracy
  • Corporatism
    Corporatism, also known as corporativism, is a system of economic, political, or social organization that involves association of the people of society into corporate groups, such as agricultural, business, ethnic, labor, military, patronage, or scientific affiliations, on the basis of common...

  • Individualism
    Individualism is the moral stance, political philosophy, ideology, or social outlook that stresses "the moral worth of the individual". Individualists promote the exercise of one's goals and desires and so value independence and self-reliance while opposing most external interference upon one's own...

  • Individualist anarchism
    Individualist anarchism
    Individualist anarchism refers to several traditions of thought within the anarchist movement that emphasize the individual and his or her will over external determinants such as groups, society, traditions, and ideological systems. Individualist anarchism is not a single philosophy but refers to a...

    • Market anarchism
      Market anarchism
      Free-market anarchism refers to an individualist anarchist philosophy in which monopoly of force held by government would be replaced by a competitive market of non-monopolistic organizations providing security, justice, and other defense services...

  • Libertarian capitalism
    Libertarianism, in the strictest sense, is the political philosophy that holds individual liberty as the basic moral principle of society. In the broadest sense, it is any political philosophy which approximates this view...

    • Privatism
      Privatism is a generic term describing any belief that people have a right to the private ownership of certain things. There are many degrees of privatism, from the advocacy of limited private property over specific kinds of items to the advocacy of unrestricted private property over everything;...

    • Propertarianism
      The term propertarianism has been used to describe various views regarding private property. Those holding positive views on property rights may be described as propertarian. Conversely, others opposed to private property may be described as non-propertarian or...

  • Guild socialism
    Guild socialism
    Guild socialism is a political movement advocating workers' control of industry through the medium of trade-related guilds. It originated in the United Kingdom and was at its most influential in the first quarter of the 20th century. It was strongly associated with G. D. H...

  • State socialism
    State socialism
    State socialism is an economic system with limited socialist characteristics, such as public ownership of major industries, remedial measures to benefit the working class, and a gradual process of developing socialism through government policy...

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