Natural Finance summary for communes/partnerships

A commune does not imply a lack of profit maximization focus compared to a regular corporation.  It is simply an organization structured as an egalitarian partnership.  The overwhelming advantages of structuring an organization as a commune is overcoming the inherent abuse created by power imbalances of unequal ownership and hierarchical organizational structures, and controling corporate corruption by having more eyes with the authority to check employees and other partners.  This article is a summary and catalog of the ideas I've developed in promoting financial transactions in communes.

Natural Governance principles apply to any egalitarian partnership or society.  The one immutable principle is that the circle of partners has ultimate authority, and each partner has the right to an equal share of profits, and the right to be paid that share by default (subject to communal obligations decided by the circle).  As a solution to voter apathy, any partner can delegate his vote in any one or several functional areas to someone else, but delegate authority can be removed at any time.  As a solution to increasing decision speed, specific executive authority can be assigned  to individuals or groups for projects, duties, functional areas based on democratically approved proposals that include salary, budget, and specific narrow decision authority/mandates.  Approved proposals are rarely given any lengthy term or monopoly powers, are likely accompanied by supervisory/review proposals, but by default carry review powers by the full circle often though delegates for the single functional role.  Line item authority and project scope is reviewable by the circle and delegates.  Proposals to replace or eliminate the executor of duties or functional direction can be made by other individuals.  Natural Governance provides an entrepreneurial framework within an organization where any perceived need can be championed by any person that sees it, and who then tailors an exploration and implementation strategy that is acceptable to most partners.

Natural Finance and Natural Governance facilitate investment in communes without ever compromising the rights of creditors or other partners.  In natural financed communes, new partnership investment is a transaction exclusively among partners. For large partnerships, a democratically set (median) purchase amount is determined by the existing partners, and an nth partner willing to buy at that price, gets a new share, pays (1/n) the value of the partnership, and the proceeds are distributed evenly among the (n-1) existing partners.  So even in a partnership of millions, it is fairly straightforward process to admit new partners.  If the share price is too high for most people/workers to afford, they can share in the prosperity of the commune through communal equity options which can be tailored to any affordability level.

Because informed investors need to plan for eventual or possible exit from a private company or commune it is critical that processes to facilitate such exit exist.  Natural democratic governance processes allow the circle of partners to use their median bid for share repurchases as an amount a selling partner could accept, or allows the partnership to vote on accepting the best offer.  Both of these alternatives require that a natural finance project be funded with new loans (likely by existing partners in varying levels).  Another alternative that does not involve new partner funding is to give the partners and option holders the right to bid  against each other (at least 20% discount) in order to sell their share, at the time of a new buyer's transaction, and with proceeds coming from a new share buyer's transaction.

Natural Finance's main focus is debt financing guaranteed to never cause dilution to a creditor because all loans are ordered in sequential payment priority.  Natural Finance permits higher debt capacity and lower financing costs through lower risk loans primarily achieved by proactive monitoring.  The symbiosis with egalitarian partnerships is that equal authority of owners provides controls that limit waste and boondoggles to the benefit of both owners and creditors, and so limits the monitoring activity required from external natural finance controller.  Owners benefit from active control of financial accounts to prevent embezzlement from an owner.

Communes have traditionally been based in anti-capitalist ideology.  Natural finance recognizes the  oppression inherent in hierarchical management structures including towards minority and other shareholders.  The purpose of financial communal equity principles is to remove the restriction that all partners must provide equal labour and other contributions, and so enable the full range of contributions that can help the commune/enterprise be successful.