Reading: Sentence Completion: Question 7

A worker cooperative is a business that is owned and governed by the people who work in it, rather than by outside shareholders or a single proprietor. Instead of ownership being tied to invested capital, each worker-member typically holds one voting share regardless of role or seniority, and major decisions, such as electing a management board or approving the annual budget, are settled on a one-member, one-vote basis at a general meeting. Profits, once operating costs and any agreed reinvestment have been set aside, are usually distributed among members according to hours worked or length of service rather than in proportion to capital contributed.

Proponents argue that this ownership structure changes incentives in ways that benefit both workers and the wider business. Because members share directly in the profits they help generate, cooperatives are often reported to have lower staff turnover than comparable conventionally owned firms in the same sector, and members frequently describe a stronger sense of responsibility for the quality of their own work. Some research further suggests that worker cooperatives tend to weather economic downturns better than investor-owned competitors, since members facing a fall in demand are often willing to accept temporary reductions in hours or pay across the whole workforce rather than resort immediately to layoffs.

The model is not without practical difficulties, however. Raising start-up capital can be harder for a cooperative than for a conventional company, since banks and outside investors have little influence over decisions and therefore limited incentive to lend, leaving many cooperatives reliant on members' own savings or specialist ethical-finance lenders. Reaching agreement among a large membership can also slow decision-making considerably compared with a firm run by a single owner or a small board, particularly when a proposal is contentious. To address this, many larger cooperatives delegate day-to-day operational decisions to an elected management team while reserving only the most significant strategic choices, such as mergers or major capital investment, for a full membership vote.

Despite these constraints, the cooperative sector has continued to expand steadily in several economies, particularly within retail, agriculture and professional services, where the model's emphasis on shared ownership appears to appeal strongly to workers seeking greater control over their working conditions.

Complete the sentences below. Choose NO MORE THAN TWO WORDS from the passage for each answer.

1. In a worker cooperative, each member usually holds one ______ regardless of their job role.
2. Major decisions are typically approved on a one-member, one-vote basis at a ______.
3. Profits are generally shared out among members according to ______ or length of service.
4. Cooperatives are often reported to have lower ______ than comparable conventionally owned firms.
5. During downturns, members often accept temporary reductions in hours or pay rather than resorting immediately to ______.
6. Raising start-up capital can be difficult for cooperatives because banks have little influence over decisions and therefore limited ______ to lend.
7. Many larger cooperatives delegate day-to-day decisions to an elected ______ while reserving major choices for a full membership vote.