Meet the New Boss(es)

Four years ago, Equal Exchange outgrew its Canton headquarters. A consultant brought in to help with its space crunch suggested that to save money, the company look for its next headquarters in western Massachusetts, where commercial real estate is cheaper. The prospect of a major relocation divided the worker-owners, who after a long debate authorized the executive directors to move to any site they felt was suitable—so long as it was within a 15-minute drive of the current location. Bound by the decision, the board narrowed its list to a half-dozen options, and organized scouting trips to each one for every single employee. “I remember taking 45 people around to kick the tires,” says coexecutive director Rob Everts. “People who saw us were like, ‘What in the world?’”

Equal Exchange didn’t arrive at its democratic leanings by happenstance. “From the beginning, the vision was a hybrid mode with worker control but strong management,” says coexecutive director Rink Dickinson, one of three food co-op veterans who helped launch the business in 1986. That initial vision has grown into a legislative machinery so complicated it makes the federal tax code look like a recipe for ice cubes. Daily decisions are made using a “governance matrix” that spells out the choices to be made, and who gets to make them. The executive directors create the budget, for example, but it must be ratified by the board. The board sets personnel policy, while it’s left to the execs to determine what those personnel earn. Bigger, strategic decisions require a vote by everyone. It can be enough to make you want to put your head down and just do your job.

That’s not lost on Equal Exchange, which has developed a rigorous process to ensure it hires only candidates who buy into its unique way of doing things. Getting a job at the company is like applying to college, with a required essay and multiple interviews. And after accepting an offer, employees have to go through a two-hour orientation to learn the basics of Equal Exchange’s philosophy, then attend weekly “exchange time” sessions over a yearlong probation period before finally receiving their ownership stake. Given all that, it’s no shock that most of the company’s employees are young and decidedly left-leaning.

Erbin Crowell, who started a division of the company that sells coffee to religious congregations, says, “I can’t think of one employee where my problem has been to motivate them to work harder.” Along with the self-selecting nature of its workforce, the company’s compensation system helps keep productivity up. This year its worker-owners split 10 percent of the profits (the take was $850 each), with another 10 percent invested in internal accounts they get when they leave; next year, those percentages will double, per a recent vote. The company also has a rule that the highest-paid staffer can make no more than four times the lowest-paid one. That way, says Crowell, “everybody knows no one is getting rich off their backs.”