COOPERATIVE RESEARCH IN FINLAND AND GLOBALLY

1. COOPERATIVE RESEARCH IN FINLAND AND GLOBALLY Iiro Jussila, Panu Kalmi & Eliisa Troberg May 2008

2. CONTENTS Introduction Objectives of this survey How the survey was performed Cooperative research in economics Cooperative research in business economics; management and organisation Research on social economy and social entrepreneurship Research on cooperative joint enterprises and new implementations Conclusions

3. Introduction Cooperative research has been based upon the international cooperative principles originated from Rochdale in the 1840-ties. The International Cooperative Alliance (ICA) renewed these fundaments for cooperative identity in 1995. During the last two centuries cooperation has spread all over the world. There are many implementations of cooperation and cooperative research is performed in many scientific disciplines worldwide in universities and colleges. Research is made both within cooperative institutes and on university departments in different countries. The major part of the research is done outside the actual research units.

4. Introduction continued . . Of the academic research organisations among the strongest are CIRIEC (International Center of Research and Information on the Public, Social and Cooperative Economy). It is active with cooperative research in universities and research institutes in Latin language countries (French, Spanish, Portuguese) AGI (Arbeitsgemeinschaft genossenschaftswissenschaftlicher Institute) which gathers cooperative research in German language universities in Central Europe The networks between researchers on cooperation i Asia. Africa and North America. for example general and regional seminars of ICA and seminars arranged by CIRIEC, AGI or the networks mentioned above. Scientific periodicals and journals like ICA’s Review of International Co-operation, CIRIEC’s Annals of Public and Co-operative Economy, AGI’s Zeitschrift fur das gesamte Genossenschaftswesen, Journal of Rural Cooperation published in Israel and the Swedish Kooperativ Årsbok published by Kooperativa Föreningen.

5. Objectives of this survey To bring forward the different research areas on cooperatives and social economy both in Finland and globally To find out the position of Finnish cooperative research within international research This survey focuses on research within economics, business economics and management as well as the different fields of social sciences. The majority of all research on cooperatives is made within these disciplines.

6. How the survey was performed This survey has been performed by using cooperative research literature and other documentation Documentation includes examination of the central cooperative research institutes in different countries, material from recent cooperative conferences and international journals.

7. Cooperative research in economics There was a lot of research on cooperation within economics before World War II. After that interest faded. Every now and then this subject becomes popular – for instance a lot of research was made on worker self-managed enterprises in the 1970-ties. The hottest subject of today is microfinance in developing countries

8. Cooperative research in economics continued . Research on cooperative banks and mutual insurance, especially effectiveness comparisons IMF active on research on cooperative banks recently In agriculture economics common with studies on cooperation Less studies on cooperative retail societies or housing cooperatives Many journals publish occasionally, all top journals have some papers on cooperation

9. Cooperative research in Finnish national economic science Pellervo economic research institute PTT, focuses on food industry The Department of Economics at Helsinki School of Economics has research on the following subjects: cooperative banks, microfinance, formation of new cooperatives, history and methodology

10. Cooperative research in business economics Not much both globally and in Finland Investor ownership and maximizing profits rules! Very fragmented No homogenous frame of reference or binding theoretical background Seldom several studies on the same subject The institutes produce mostly surveys and teaching material Educational needs direct the activities of the institutes and they lack recourses to achieve a long spanned development of the theory

11. Cooperative research in business economics globally The position of cooperation in international business economics journals In the top journals (impact factor > 1.500) the number of articles on cooperation adds up to seven In other journals that have impact factor (Thomson Reuters) there were slightly over 20 articles on cooperation A few journals concentrating on cooperation or with a positive attitude Journal of Co-operative Studies International Journal of Co-operative Management Annals of Public and Cooperative Economics Economic and Industrial Democracy The position of cooperation on international business economics conferences Occasional papers, cooperation has no institutional position Mainly research related to management and organisation, also in the field of financing and accountancy

12. Finnish cooperative research in business economics Emphasis in the field of management and organisation Main theme of research for few No professorships (e.g., on co-operative management)! Doctoral theses: Iiro Jussila, Merita Mattila, Eliisa Troberg, Juha-Matti Saksa, Titta-Liisa Koivuporras… Post graduate students: Jani Mäkinen, Pasi Tuominen, Terhi Tuominen, Saila Rosas, Jussi Kuittinen, Anni Heikkilä, Eeva Kerola Subjects: ownership, strategic management, organisation, governance, membership relations, relations to interest groups…

13. Finnish cooperative research in business economics continues… The department of Management and International Business at LUT School of Business in Lappeenranta University of Technology has a research group specialized in cooperation Was established in 2005 and has more than 25 publications on cooperation in international academic journals and conferences Has long-term goals to develop cooperative management as an academic discipline Post doc research Ongoing in management and organizations Beginning in accounting Post graduate research (topics) Cooperative entrepreneurship and entrepreneurial cooperation Locality and regionality in strategic management of consumer cooperatives Integration of an acquired public company in a cooperative bank group Purchase management in cooperative banks

14. Research on social economy and social entrepreneurship The concept of social economy comes from the 19th century even though precursors of cooperatives and organisations with solidarity existed already in ancient Egypt. Social economy as a term is not unproblematic and there is no definite definition in different countries. In the EU the expression CMAF is used instead of social economy. CMAF = cooperatives, mutuals, associations and foundations. In Finland social economy is connected to private economic and social activities.

15. Research on social economy and social entrepreneurship continued . . Also the concept of social entrepreneurship is complex and this is understood differently all over the world. The European Commission included the social enterprise in the organisations regarded as social economy in 2004. According to the Commission the meaning of a social enterprise is an enterprise that uses its profits to promote social goals. The company form may, according to the Commission, be any organisation within social economy or even a private company.

16. Research on social economy and social entrepreneurship continued . . Researchers from 15 European universities formed the EMES-network (European Research Network) concerning social economy, social entrepreneurship and workers’ cooperatives in 1996. The importance of actors within social economy has increased in solving social challenges and hence research dealing with social economy has strongly grown in Europe, USA and Canada in resent years. This field of study is becoming ever more important; among others social entrepreneurship, sustainable development, different ways to report social responsibility and social accounting are clearly subjects of growing interest.

17. Research on social economy and social entrepreneurship in Finland In Finland studies about social economy and social enterprises have been among others produced by Juhani Laurinkari, Tapani Köppä, Pekka Pättiniemi, Anita Mattila, Marianne Nylund, Veli-Matti Poutanen, Torsti Hyyryläinen and Niina Immonen. Juhani Laurinkari, Tapani Köppä and Niina Immonen have studied social economy especially from the point of view of cooperation.

18. Research on cooperative joint enterprises and new implementations Cooperative entrepreneurship, workers’ cooperation and new implementations of cooperation have been studied for several years within several disciplines, among others: economics, governance within business economics and especially sociology within social sciences. Studies on workers’ cooperation have had strong emphasis on employee ownership and the impact of employee participation in organizational decision making. Employee ownership and its impacts is still in in the 21st century a central subject for studies within social sciences and studies on governance and organisation in business economics.

19. Research on cooperative joint enterprises and new implementations continued . . There has not been much research on cooperative entrepreneurship as a form of entrepreneurship in itself during the 1990-ties and this decade. However, the workers’ cooperative complex around Mondragon has been a subject for a large number of studies during last decades. In England there has been a long tradition on research about management in employee owned cooperatives and the success factors herein (e.g. Cornforth and Spear). Small rural cooperatives have been subject for cooperative entrepreneurship research as well. Other subjects during this decade are studies on small women's’ cooperatives in Greece and in China as well as new cooperative implementations. New implementations in cooperation is getting more and more popular in the field of cooperative research.

20. Research on cooperative joint enterprises and new implementations in Finland Thanks to the revival of small scale cooperation from the beginning of the 1990-ties joint entrepreneurship in form of cooperation as well as new implementations of cooperation have been subject for research in Finland. Panu Kalmi, Eliisa Troberg and Eero Riikonen have done research on employee ownership among other things. Studies on new implementations of cooperation have been published by for instance Tapani Köppä, Eero Riikonen, Iiro Jussila, Terhi Tuominen, Kari Pirinen, Pekka Arponen, Pekka Hytinkoski and Eliisa Troberg.

21. Conclusions During last decades international cooperative research has covered especially the following subjects: In economics: particularly the effectiveness of cooperative banks, microfinance, employee ownership and its impacts. In business economics: management and organisation, governance, membership relations, member commitment and studies regarding interest groups. Studies related to agricultural economics Studies concerning the impact of employee ownership Studies regarding cooperative values and principles Studies on new cooperative implementations and social economics

22. Conclusions continued . . All the subjects mentioned above have not got the same attention in Finland. For instance agricultural economic research is made quite scarcely as well as research on mutual insurance. The large cooperatives have been studied from many aspects in recent years, but more research on their juridical aspects, financing and accounting as well as their internationalisation would be needed. Regarding small cooperatives more studies should be made on their impacts for instance on employment and also on differentiation among small cooperatives in Finland.

23. Conclusions continued . . Much more research in all fields of business economics is needed on the international level The resources for financing should extensively be developed internationally! The cooperatives would need a common framework for cooperative research in business economics More research on the differences between different types of cooperatives is needed Cooperative research should become a normal subject in the well-known international scientific journals and conferences

24. Conclusions continued . . Cooperative research in Finland has been both qualitative and quantitative with more emphasis on the first. New researchers appear, but they are still very few Finnish cooperative science has the opportunity to become leader in the world Above all conditions for long-term research should be created Much more resources for research from outside the universities should be available Funding for professorships on co-operation Funding for post doc –groups on co-operation Note: University financing is going through changes! The key question is “Which organizational forms will be promoted by research and education in the future?”