SCOP – Cooperative in France

What has most astonished me this week is the French company legal statute called SCOP.

The specificity relies in promoting a better return to the workers and in protecting the company again financial speculations.

At first glance, it sounds fair and sustainable … but then I realized that it wasn’t possible when you leave the company to get back your part of the valuation :

Let’s assume I start a company with subscribing 51% of the capital of 10,000 € ; I work in that company for 10 years and extend customer base, develop high performance employees, optimize all business processes and generate tremendous EBITDA … so that in the end the value of the company extends to 70 million € … when I sell my shares of a SCOP, I’ll get back 5,100 € !!

Of course I will have received salaries and compensation for my good work but there won’t be further return on the capital invested nor on the value created.

And I was very surprised that in France the utopia still exists that you can create sustainable employment without being attractive to investment.

Herve

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One thought on “SCOP – Cooperative in France

  1. On size does not fits all. The SCOP status may not be proper for activities requiring high level of financial investment. The Ltd (SA) status may not be proper either for activities requiring low level of capital.
    We also have to recognise that, in the past years, the search for short term financial gain has been a significant contributor to the situation we are in today, where inequalities have grown both in a quantitative manner (reaching unprecedented levels) as is quantitative manner (stakeholders are pursuing different aims); and where production has been transferred to low income – low rights areas.
    Long term creation of value and wealth, sustainable production, should be the primary, essential and central aim to any enterprise. Each stakeholder should pursue this aim (another French utopia?).
    The SCOP status may not be ideal, far from that, but it is offering alternatives.
    And one can still invest in a SCOP with an indexation on inflation, so in the end, you’ll get more that the original 5100 Euros … better than with, say, Eurotunnel…

    Gilles

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