Tennessee needs a cooperative society law


While in law school, I had the opportunity to work with the Sustainable Economies Law Center in Oakland, California. It was a group of lawyers, lawyers-in-training, lawyers and professionals working to provide legal services to co-operative societies, with the aim of making the law accessible to people without legal training. SELC did this by using plain language where possible, breaking concepts down into smaller chunks, and even illustrating cartoon explanations, all in legally binding contracts.

While waiting for my law degree in Tennessee, I started my own LLC. As I worked on it, I wondered how I wanted this “ship” to work. I was reminded of the language of economic democracy used at SELC and the number of fair opportunities offered by corporate statutes and operating agreements.

You see, I – like many – thought “the way things are” were set in stone. It turns out there are rules you need to follow when starting and running a business, but there are plenty of other opportunities to empower workers and benefit communities through the structure of the company. company.

How we “structure” a business dictates how the business makes its decisions. Who has a say in what the company does, who receives the benefits and at what rate, who decides the insurance plan, days off and other priorities and commitments – these things are all behaviors of the “structure”. We can build any structure we want.

I want my company to amplify my impact and my income in the world, and to do the same for others working in the same boat. Not everyone has investment money, but everyone who comes on board runs the risk of falling overboard or sinking with the ship. I want us to decide together where the boat is going, and even if it gets too big for everyone to take the helm, I want a representative on the bridge.

However, in Tennessee, there is no general cooperative society statute. There are exceptions for the processing, purchase and marketing of agricultural products, as well as for electricity, but no general law on cooperatives. This means that if you want to start a business that operates like a cooperative, you have to go through a truly unique LLC or corporation, which requires a lot more lawyer time.

There are significant advocacy and education groups that cultivate cooperative enterprises in our state. There are also legal clinics that can help businesses form on a cooperative basis. However, the movement towards a cooperative economy is hampered by the lack of turnkey structures for start-ups and existing businesses. Because cooperative societies promote sustainable communities, the state legislature should simplify the process by allowing cooperative societies to form in Tennessee.

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Carlson Swafford

If Tennessee had a cooperative society law, then any business could form or convert to a worker-owned or consumer-owned cooperative. This would alleviate the symptoms of capital flight by giving capital more connections and a home. While relocation to Tennessee may be “in vogue” right now, these relocations also prove that belonging and place are contingent on profits for companies that lack a structural relationship with the communities in which they live.

If Tennessee passed a cooperative society law, advocacy, education, and legal assistance efforts could be streamlined. Then, the voluntary state could promote impact investing in companies that not only promote sustainable economic growth, but also tend to benefit the environment. Until the Tennessee General Assembly acts, I will continue to do what I can to support businesses equally committed to democracy in the marketplace. See you at sea.

Carlson Gray Swafford is the founder of Eco Demo Advisors, LLC.


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