The prevailing model of corporate governance has become a structural liability, driving both environmental decline and democratic erosion. To safeguard our political institutions and regenerate our environment, we must complete the democratic project where it matters most: within the company itself. This is the conclusion reached by the extensive study carried out by the International Committee of Experts that I chaired, comprising colleagues from leading academic institutions—Oxford, Harvard, the London School of Economics and the European University Institute, among others—and established by Yolanda Díaz, the vice-president and minister of labour of the Spanish government. Today, our committee releases its Report on Article 129.2 of the Spanish Constitution, a long-neglected clause that mandates worker participation in corporate decision-making and ownership.

Nearly fifty years ago, Spain’s democratic transformation inspired the entire world. Emerging from the long shadow of the Franco dictatorship, the country drafted a new constitution that promised to rebuild society on the foundations of freedom and equal rights. Yet for five decades, a critical element of this democratic architecture has remained unfinished. While the Spanish people gained the right to choose their leaders at the ballot box, they have remained subjects of an outdated autocracy in the workplace—a reality that applies to most of us around the globe.

Our current economic model treats workers as “human resources”—costs to be minimised rather than contributors to be valued. The result? Most citizens spend their working lives in places where they have no voice, no agency and no share in the wealth they create. It is no surprise that faith in democratic institutions is eroding, a phenomenon sometimes called “democratic fatigue” and one cause of the democratic collapse we are witnessing in many countries around the globe. The Spanish constitution had the wisdom to foresee that you cannot sustain a democratic state on the foundations of autocratic workplaces.

Workers as labour investors

Our research identifies the need for a fundamental shift in which we recognise workers as the labour investors they truly are. If shareholders invest capital, workers invest their lives, their health and their futures. In any other area of law, such a high-stakes investment would grant the investor a seat at the table. Yet in the modern corporation, labour investors are treated as outsiders to the very entities they sustain.

We have identified nine systemic challenges that this structural deficit in democracy has exacerbated. From the looming crisis of succession in small businesses to the rise of artificial intelligence, lack of worker voice is a ticking time bomb. In the realm of AI, for example, without the right to co-decision, technology becomes a tool for intensifying surveillance and wage suppression. With it, workers become strategic partners and AI a catalyst for shared prosperity—a vision echoed in the testimony given to our committee by Daron Acemoglu, the 2024 Nobel laureate in economics.

The recommendations of our committee are practical and data-backed. Emulating best practices in the European Union, we propose new legal minima: a model where workers hold one-third of corporate board seats in firms with 50 or more employees, rising to co-decision—that is, one-half—in larger corporations. We suggest a new legal right for workers to consent to AI via collective veto power over shaping and deploying AI technologies at work. Finally, we propose that the ownership gap be bridged by requiring all firms to open a percentage of their capital to workers.

To accelerate this transition, we developed the Corporate Democratic Development Index. Through a “bonus/malus” fiscal incentive system, firms that achieve high standards of democratic governance can be rewarded with lower corporate tax rates and priority in public procurement. Conversely, firms that maintain archaic, high-friction models would bear the social and environmental costs they currently externalise to the state.

A planet-focused resource for states

This proposal offers a long-term, planet-focused resource for states. While shareholders are often distant and focused on short-term dividends, labour investors live in the communities where their firms operate. They are the first to suffer when a river is polluted or a local economy is hollowed out. By giving them access to voice and ownership—a move pioneered by companies in the social and cooperative sector—companies can become regenerative entities that internalise their ecological footprint and social externalities.

Spain has a historic opportunity to lead. Just as it boldly transitioned from dictatorship to democracy in the 1970s, by fulfilling its constitutional promise to its people it can show Europe, and the world, how to transition from an extractive economy to a regenerative one—thereby upholding Article 1 of the Universal Declaration of Human Rights: all human beings are born free and equal in dignity and rights. Our report maps a clear way to honour this promise.

Report available in EN and SP at: www.ReportonDemocracyatWork.org

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