Worker Ownership, Green Jobs, and
Partnerships with Institutions: A Prescription
for America’s Inner Cities?
An Overview and Analysis of the Evergreen
Cooperatives in Cleveland, Ohio
Kelly Graham
Research Goals: To determine the tangible and intangible elements of a new
model of community economic development and the potential for it to be
replicated in other cities.
Environmental Health and Equity: Global Strategies
and Innovation
April 30, 2011
McGill University
Project Methodology
• Qualitative case study
• Data sources:
• 39 semi-structured open-ended interviews with multiple
stakeholders
•
•
•
•
The Evergreen leadership team at the Cleveland Foundation
Workers in the companies
Institutional leaders from the anchors and the city
Associated people working in the community
• Direct observation of meetings, workplace visits
• Program documentation
• Analytical Framework:
• Strategy rests on sound evidence-base
• Replication requires consideration of local conditions
The Evergreen Strategy
•
Targeting Anchor Institution Purchasing
• Non-profit institutions that are rooted in their communities, “Eds and Meds”
• 3 major University Circle institutions spend combined $3 billion on services and
procurement
•
Worker Ownership
• Profits distributed among employee owners, circulate in the community
• Businesses rooted in communities, owners unlikely to send their jobs away
• Builds on highly successful Mondragon Cooperatives in the Basque Region of
Spain
•
Green Jobs
• New economic niche and increasing demand for green products
• Sustainability requires new technologies and practices
• Government support
•
Triple bottom line of people, planet, profits
Greater University
Circle
•
University Circle, 1-mile
radius, contains major
institutions including: Case
Western Reserve University,
University Hospitals,
Cleveland Clinic
•
GUC: 6 target neighborhoods
have average income of
$18,500
Greater University Circle Initiative
(est. 2005) focuses on:
•
Education
•
Housing
•
Safety
•
Economic inclusion (Evergreen
Initiative)
Greater University Circle Target Area:
Boundaries and Neighborhoods
Source: Cleveland Foundation
Contrasts: University Circle and
Surrounding Neighborhoods
University Circle: Cleveland
Museum of Art
Vacant lots in Hough
neighborhood
Context
•
High poverty,
unemployment, and
segregation
•
Loss of manufacturing as
economic base
•
Job & population loss
•
Exacerbated by foreclosure
crisis and recession
Map: Colored areas indicate
the location of vacant land,
poor and unsound building
conditions, water shut offs, tax
delinquencies and foreclosures
Source: Cleveland Foundation
Businesses
•
Evergreen Cooperative Laundry (est. Oct 2009)
• Industrial laundry: hospital, hotel, nursing home linens
• Energy & water efficient, fewer and safer chemicals
•
Ohio Cooperative Solar (est. Oct 2009)
• Solar panel installation and operation,
power-purchase agreements
• Weatherization of homes
•
Neighborhood Voice (est. September 2010)
• Print and online community news source
• Run by high school and college student
•
Green City Growers (spring 2011)
• Hydroponic greenhouse growing lettuce and herbs
• Wind turbine on site, sustainable technologies to reduce water, fertilizer, heat, and electricity
requirements
•
Evergreen Business Services (serves all the cooperatives)
EVERGREEN COOPERATIVE STRUCTURE
ECC is a for-profit owned and controlled by its members - members will include:
cooperative businesses, critical stakeholders and strategic partners
GUC Initiative
Transit-Oriented Development
Education
Housing
Engagement
Evergreen
Cooperative
Development
Fund
ECDF
Board of
Directors
Evergreen
Cooperative
Corporation
(ECC)
Executive
Cooperative Businesses
CDFI
(for Profit)
Structured
Fund
(non -Profit)
Audit & Finance
Governance
Strategic Planning
Investment
(for Profit)
(non-profit holding
Company/
Intermediary)
CDE
Committees:
ECC
Board of
Directors
Evergreen
Business
Services
Evergreen
Land
Trust
(for Profit)
(Non-Profit )
(for Profit)
Accounting
IT
TA
Human
Resources
Building a Culture of Ownership
“What they said about the way I run the tunnel, that was one of the things at the start I
was like ok if I start this tunnel 45 minutes earlier than before and I multiply by 21 each
pocket, I can cut the time sorting and the time on the floor practically in half. It was an
experiment and it work out marvelous and something that we actually use today” (ECL
employee #1, 8 June 2010).
“I feel with this company, the difference in this company, versus other companies I worked
for, its like I worked for them, its like I belong to this company” (OCS employee #2, 1 July
2010)
“Think about that brand new, think about your very first car when you were 16 years old.
And you washed it every day and you wanted it to be the best car on the block. And I tell
them to think about it like that, think about this is your first business, and you would like
for it to be the best business. But the only way we can make it the best business is to work
hard and to keep our clients happy.” (ECL manager #1, 22 June 2010).
“It’s a culture of ownership, it’s a culture of not just ‘Me Inc’ but it’s one of me, fellow
worker, and company all wrapped into one. In other words, it has to be a profitable
enterprise, so we all have to work together to make that happen” (Evergreen startup CEO
#1, 8 June 2010).
Outcomes
• In its first year, the Evergreen Initiative has created 4 businesses and
48 new jobs
• Recipient of Living Cities Integration Initiative Award ($15
Million)
• Interest in replication in Atlanta, Pittsburgh, Youngstown
• Environmental impact inherent in business design, will grow as the
businesses grow
• Deepening commitment from institutional stakeholders and city
• Intangible: New sense of hope in the community, sense of
connection between institutions and communities
Challenges
• Challenges for the Initiative
• Confronting skepticism and lack
of knowledge about cooperative
model
• Defining and institutionalizing
structure, mechanisms
• Capacity restraints
• Business Development
• Financing
• Finding talented management
• Land acquisition for GCG
• Lack of support for print media
for NV
• Business Operations
• Obtaining contracts
• Cultivating sense of ownership
• Future challenges
• Proving the model and
moving to a meaningful scale
• Shorten business development
time frame
• Building management talent
within the employee owners
• General challenges of startups
• Competition from other firms
that lack social mission
Essentials Elements (1)
•
Context of Cleveland
• Persistent economic decline plus 2007/2008 crisis
• Need for new approaches and sense of urgency
•
Wider trend towards sustainability
• Demand for ways to reduce environmental footprint
• Local, state, and federal initiatives for efficiency, renewable energy, and
sustainability
•
Geography of Greater University Circle (GUC)
• Focal point for initiative – “building on strength”
•
Role of Cleveland Foundation
• Funder, convenor, and power broker
• Commitment to strategic initiatives, not afraid to take risks
Essentials Elements (2)
•
Role of the City of Cleveland
• Alignment with the Mayor’s priorities
• Helped secure funding and land assembly
•
Leadership
• Talented and deeply committed Evergreen Leadership team
• New leadership at institutions, recognition of their role in community
• “Community of change”: Philanthropy, Institutions and the City
•
Partnerships and collaboration
• GUC meetings established track record, built trust among stakeholders
• ‘Win-win’ alignment between institutions and the initiative
• Institutions propose business ideas
• Partnership is institutionalized in “Class C” stakeholder shares
Recommendations for
Replication
• Recognizing that the Evergreen Initiative is still in its infancy and not yet a
“proven” model:
• Theoretically, the model of worker ownership, anchor purchasing, and
green jobs is widely applicable
• The basics: anchor institutions, a target community, leadership, and funding
• Equally important: context, relationships, shared vision
Find: An organization to fulfill Cleveland Foundation role, talented and
motivated leadership, alignment with institutional leaders
Cultivate: relationships among stakeholders (philanthropy, institutions,
community groups, government), ownership culture
Adapt: to local historical, cultural and political contexts, policies