Given the socio‐economic importance of cooperative firms and in the light of evidence that they are an effective option for competing in complex environments, an intensive examination of their organizational model is required. It is significant that some of the most consolidated worker cooperative organizations have focused on Market Orientation. The central purpose of this research is therefore to examine the influence of a set of internal antecedents of market orientation found in cooperatives. We shall then verify the possible benefits of market orientation on their business performance. The subject of this analysis will be the worker‐owned businesses that make up the Mondragon cooperative group, a global pioneer in democratic business practice.

A management model is a set of choices made by a firm's leadership regarding how objectives are defined, efforts are motivated, activities are coordinated and resources allocated, in short, regarding how the company will be run. Just as other types of businesses do, cooperatives need to create sustainable competitive advantages by adopting market-oriented management approaches. Mondragon Corporation achieves this in an alternative way relative to the conventional organizational and governance model, combining commitments to democratic principles, solidarity and competitiveness. Inspired by changes in the expectations of worker-members, new technological capabilities and the strategies of new competitors, Mondragon Corporation has designed a distinctive management model that can itself be a key driver of its competitiveness. The research presented here is focused on market orientation (MO), its relationships with a set of internal factors found in Mondragon cooperative enterprises, and their subsequent impact on business performance. Empirical results suggest that (1) Mondragon's management model increases organizational commitment, facilitating the adoption of MO and (2) a positive impact of MO on business performance. Practical and research implications are discussed. JEL classification: J54, M31