Cooperatives and Social Enterprises in Europe and in Transitional Contexts

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1 INTERNATIONAL CONFERENCE Cooperatives and Social Enterprises in Europe and in Transitional Contexts BELGRADE, JUNE, 2012 EURICSE European Research Institute on Cooperatives and Social Enterprises University of Belgrade Faculty of Philosophy Institute for Sociological Research

2 The conference Cooperatives and Social Enterprises in Europe and in Transitional Contexts is organized as closing happening of the EU FP7 Marie Curie project RECOSET. The conference is organized by EURICSE institute from Trento and the Institute for Sociological Research, University of Belgrade. The conference was partially supported by the Ministry of Education and Science of the Republic of Serbia. Some of the presented papers were produced under the project No of the Ministry of Education and Science of the Republic of Serbia.

3 CONFERENCE PROGRAMME Cooperatives and Social Enterprises in Europe and in Transitional Contexts Belgrade, Faculty of Philosophy, June, 2012 The aim of this conference is to advance scientific and professional discussion on role, limitations and potentials of social enterprises and social cooperatives in post-transitional countries, with special emphasis on role, limitations and potentials of this sector in Serbia. Thanks to this conference, the interested scientific public, students, policy makers and social entrepreneurs will have an opportunity to compare experiences from different countries with diverse historical and institutional heritage, as well as to hear opinion of some of the most competent European and Serbian researchers in this field. The happening consists of two parts, an open conference and a project workshop directed towards discussion on fulfilment of the project goals and agreement on further cooperation in research of social economy. The key postulate of the conference is socially sustainable development no society can be considered as successful and righteous if a large number of its members are socially excluded. This is the reason to search for innovative ways to establish balanced social and economic development Registration of participants Conference opening Friday Mina Petrović, Head of Institute for Sociological Research, University of Belgrade Carlo Borzaga, President of EURICSE Žarko Šunderić, Manager of SIPRU, Government of the Republic of Serbia I SESSION: PUBLIC POLICIES AND SOCIAL ENTREPRENEURSHIP IN EUROPEAN CONTEXT Moderator: Maja Bobić, European Movement in Serbia Giulia Galera, EURICSE: Dynamics of Institutionalization of Social Enterprises Carlo Borzaga, Trento University: Social Enterprises and Public Policies in Europe Mary O'Shaughnessy, Cork University: Irish Social Enterprises and their Contribution to Rural Service Delivery

4 Discussion Coffe break Slobodan Cvejić, UBFP-ISR, University of Belgrade: Public Policies as a Framework for Development of Social Entrepreneurship in Serbia II SESSION: CONDITIONS FOR DEVELOPMENT OF SOCIAL ENTREPRENEURSHIP IN SERBIA Moderator: Gordan Velev, Group Discussion Lunch Marija Kolin, Institut of Social Sciences, Belgrade:Forms of Social Enterprises in Serbia Žaklina Stojanović, Svetlana Popović, Faculty of Economics, University of Belgrade: Economic Aspects of Development of Social Entrepreneurship in Serbia Radmila Grozdanić, College of Business Economy and Entrepreneurship, Belgrade: Entrepreneurship in Social Sector Danilo Vuković, Faculty of Law, University of Belgrade: Social economy, civil society and welfare services in Serbia Marija Babović, UBFP-ISR, University of Belgrade: Transformational Problems of Agricultural Cooperatives in South-East Serbia Miodrag Shrestha, Coalition for Social Entrepreneurship, Belgrade: Factors of Development of Social Entrepreneurship in Serbia III SESSION: SOCIAL ENTREPRENEURSHIP IN SERBIA EXAMPLES OF BEST PRACTICE Moderator: Miodrag Shrestha, Coalition for Social Entrepreneurship Discussion Dinner Marko Stefanović, LICEULICE Miodrag Nedeljković, IDC: EKO BAG Anica Spasov, Our House: MEALS ON WHEELS Olivera Vuković, SeConS Development Initiative Group: Social Entreprenurship as a Model of Economic Empowerment of Women in Serbia Branka Orlović, RRS Novi Mostovi: Employment Through Cooperatives

5 Saturday IV SESSION: DIVERSITY OF DEVELOPMENT MODELS OF COOPERATIVES AND SOCIAL ENTERPRISES Moderator: Giulia Galera, EURICSE Coffe break Dušan Mojić, UBFP-ISR, University of Belgrade: The Role, Constraints and Potential of Cooperatives in Armenia Narek Vardanyan, Vardan Urutyan, ICARE, Armenia: Cooperatives in Armenia: Lessons learned from Serbia and Italy Anatoly Kasyanenko, ORACUL, Belarus: Potential and Role of Social Enterprises in Belarus Sergey Sinyakin, Nina Yakovleva, SESP, Ukraine: Potential and Role of Social Enterprises in Ukraine Luca Bettarelli, EURICSE, Italy: Selected Case Studies of Social Enterprises In Ukraine PROJECT WORKSHOP Lunch

6 ABSTRACTS Giulia Galera EURICSE, Trento Dynamics of Institutionalization of Social Enterprises Recent years have seen growing interest in the role that the civil society can play in the economy. The increasing awareness and sensitivity of citizens towards issues such as protection of the environment; poverty in less developed countries; and the welfare of their local communities have contributed to the spread of new initiatives. At the same time, this emerging sense of social responsibility has generated a multiplication/ revival of definitions where the suffix social is added next to typically economic concepts to define the new emerging initiatives. Social has been increasingly attached to a variety of concepts, including corporate governance (CSR); enterprise (social enterprise); business (social business); entrepreneurship (social entrepreneurship) and, more recently, innovation (social innovation). What has become increasingly clear is that this diversity in approaches, concepts, and cultures adds to the confusion and calls for a clarification. The presentation proposes a tentative classification that aims to picture the various concepts that have been increasingly employed over the last decades in a dynamic way. Following a description of each definition along two axes (institutional and entrepreneurial dimensions), particular attention is paid to the definition of the social enterprise that has been developed in Europe. Next, by referring to representative national case studies, the presentation focuses on the various degrees of institutionalization characterizing social enterprises in the enlarged Europe with a view to identifying the main factors contributing to their expansion. Three stages of development of social enterprise are pinpointed: 1) the embryonic upsurge of spontaneous social enterprise-like initiatives (currently CIS countries); 2) the emergence of social enterprise (currently several CEE and SEE countries); 3) the institutionalization of social enterprise (several EU countries). Reference is made to the key characteristics and challenges faced by social enterprises in each stage of development. Key words: social enterprise, institutionalization, civil society.

7 Carlo Borzaga Trento University Social Enterprises and Public Policies in Europe Modern welfare states are built on a changeable degree of interaction among various types of welfare providers, which include both public and private organizations. In such a framework, public administrations can provide social services directly; maintain the power of regulating the provision of social services; and be responsible for funding the provision of social services. From an international perspective, various models of interaction between public administrations and private providers can be found in the diverse countries, which differ in terms of aims pursued, mechanisms implemented, and outcomes achieved. Following a brief description of a scenario that is characterized by different models of welfare state -from a minimum state intervention up to the universalistic welfare state model (Sweden)-, this presentation will principally focus on the relations that are established by public administration and private providers in developed welfare states. The presenter will dwell on a number of policy strategies presupposing the interaction between public administrations and private providers, paying particular attention to the implications for social enterprises. The strategies analyzed include the following: a support strategy that is characterized by a not systematic provision of lump sums to private providers; an incentive strategy where the allocation of public resources is conditioned to the fulfilment of specific tasks; a contracting-out strategy implying that the public administration enters into contract with a private provider; a voucher strategy where users entitled to access certain services are directly funded by the public administration. Pros and cons of each strategy are briefly described. Drawing on the experience accumulated by EU countries, the presenter will provide insights on how to define an effective strategy that can support, at the same time, innovation in social service delivery and financial stability. Key words: social enterprise, public policy, welfare state, policy strategy.

8 Mary O'Shaughnessy Cork University Irish Social Enterprises and their Contribution to Rural Service Delivery The purpose of this paper is to provide a brief overview of the range of social enterprises found across the Irish landscape and will focus specifically on the contribution of social enterprises to the delivery of rural based services. The paper begins with a review of research which has been undertaken to date on the sector and pays a particular focus on statutory support measures which have been developed to stimulate and supporting Irish social enterprises. The paper progresses to focus on social enterprises engaged in the delivery of public services in rural areas. It explores the role of a rural based, social enterprise organising rural transportation to improve access to remote area. It highlights the very important impacts of such a service for local residents and describes some of the challenges threatening the long term sustainability of this local initiative. Key words: social enterprises, Ireland, public services, rural areas

9 Slobodan Cvejić Institute for Sociological Research, University of Belgrade Public Policies as a Framework for Development of Social Entrepreneurship in Serbia Several researches pointed out that social enterprises (SE) sector has been growing in Serbia in last couple of years. Different forms of SEs have been established, major actors recognized, basic networks and coalitions founded, market niches formed. With certain changes in legislative framework (e.g. introduction of social cooperatives, recognition of social enterprises as service providers in social care) SE sector in Serbia is entering its institutionalization stage. At this stage it is of utmost importance to recognize which are the strengths and the weaknesses of the sector in order to design adequate policy measures to support SEs. Public policy support needed to strengthen SE sector is not related to direct support or provisions to SEs only, but also to other sectors, entities and processes in economy and society (e.g. employment, budget support, informal economy, social care, public enterprises, corruption etc.). Consequently, there is wide spectrum of public policies that should be considered when designing a favourable surrounding for rise of SE sector (labor policy, taxation policy, civil society policy, etc.). In this paper, major issues in institutionalization stage of SE sector and relevant policy frameworks in Serbia are presented. Key words: social entrepreneurship, public policy, institutionalization.

10 Marija Kolin Institut of Social Sciences, Belgrade Forms of Social Enterprises in Serbia The concept of social enterprise recently started to gain attention as a viable solution for growing unemployment and raising demands of social services provision in Serbia. Although Serbia has not adopted a proper legal framework for social economy to flourish, different social actors corresponding to social enterprises have been recognized on the socio-economic scene. Organizations identified as social enterprises have a potential of the economic integration of disadvantaged groups through the employment and social integration of marginalized social groups. The aim of this presentation is to give a description and overview of the social enterprise sector, information on the most important types, explain driving forces and barriers hampering swifter entrepreneurship development and measures-policies promoting social enterprises. Key words: social enterprise, social economy, disadvantaged groups, social integration.

11 Žaklina Stojanović, Svetlana Popović Faculty of Economics, University of Belgrade Economic Aspects of Development of Social Entrepreneurship in Serbia Introduction: Although the social entrepreneurship is a well-known and exploited business form in developed countries, the economic influence of this sector is still limited in Serbia. The paper starts with the analysis of overall importance of the 3 rd sector in a modern economy. The social entrepreneurship appears to be an effective tool for marginalized groups inclusion. However, the third sector importance can not be exclusively analyzed from the social point of view. The economic aspects are equally important. Most authors agree that the key distinguishing feature of the 3 rd sector (social aims) have to be combined with indicators of their economic performance. A modern social entrepreneurship relies on the triple bottom line - 3BL (social, economic and environmental sustainability). The Methodology: The research is explorative in its nature. The results are obtained by the structured questionnaire conducted with 33 social enterprises/entrepreneurs in Serbia. Qualitative techniques are implemented in order to find out whether the 3 rd sector performance in Serbia meets the 3BL. The research is a part of the program for professional support and business promotion of social enterprises in Serbia. The basic aim of this program is to provide professional support to social enterprises. The positive examples of good practice are considered as an incentive for others to start similar initiatives in Serbia. The program is realized by SENS (Social Economy Network Serbia) during The research clearly addresses the distinctive aspects of traditional and emerging social entreprises in Serbia. The Results and Policy Implications: The third sector in Serbia is still in its infancy. The current legal and policy framework does not support development of the so-called alternative economy. The incentives, both financial and non-financial, are rare and nonsystematic. However, most of interviewed stakeholders are not fully informed about importance of the 3BL. Thus, the paper presents the basic economic guidelines for the third sector development in its initial phase. The actions should be clearly addressed to improvement of the stakeholders perception of the overall social enterprises image as well as image of their products/services. The sector strongly seeks for significant improvement of internal relations and enterprises competences in the area of business economics. Specific actions should be taken in order to improve relations with consumers and special social groups. Key Words: the 3rd sector, social enterprise, social entrepreneur, 3BL, economic performance.

12 Radmila Grozdanić College of Business Economy and Entrepreneurship, Belgrade Entrepreneurship in Social Sector The paper is occupied by market aspects of social enterprises, as social entrepreneurs are the revolutionaries that make large scale social impact in their communities around the world. Social entrepreneurs are seen in this paper as change friendly, market opportunity-oriented, innovative, and resourceful, value creators. They have to see resources and find a way to mobilize or move them to areas of higher productivity and yield. They are supposed also to find a way to create value and be competitive at the market. In the paper are more detailed researched the ways social entrepreneurs have to act to be change agents in the social sector by: adopting a mission to create and sustain social value on the market, relentlessly pursuing market niches opportunities to serve their mission, continuously innovating, adapting and learning, acting boldly without being limited by resources currently in hand. The paper emphasis the role of education and business planning, managerial skills and entrepreneurial talents to help solve social problems through the provision of socially important goods and services. Key words: Social Entrepreneurship, Marekt Niche, Business Planing, Opportunity, Competitivenes

13 Danilo Vuković Faculty of Law, University of Belgrade Social economy, civil society and welfare services in Serbia In this article we analyze the role of the civil society organizations in the provision of social welfare services. The role of civil society organizations is growing for two reasons. First, structural changes in the welfare state lead to a growing marketization, privatization and larger role of private and non-profit sector. Second, in the process of democratization civil society is perceived as a mechanism for ensuring accountability and civic control of the government. In Serbia, civil society organizations are not rooted in hectic civil society, as the empirical data clearly indicate. They have developed as a result of donors' agendas and lately with the financial support from the state. One of the exceptions is self-help organizations such as organizations of persons with disabilities. In this article we argue that the self-identification of civil society organizations is divided between two concepts: advocates of rights and interests of certain groups and individuals and service providers. This second concept fits into the framework of social economy. It gains importance as donors and state contract these organizations to deliver services, especially in the field of social welfare. At present, these organizations account for a quarter of market share in community based welfare services. Two thirds of them are for persons with disabilities and persons with learning difficulties and the same share is implemented in more developed municipalities. This highly developed social economy in welfare services leaves at least two questions unanswered. First, how will the organizations paid by the government keep their autonomy to advocate for the rights and interests of their clients? Second, how will this affect their self-identification? Key words: civil society, civic activism, social entrepreneurship, social economy, social welfare, community based services

14 Marija Babović Institute for Sociological Research, University of Belgrade Transformational Problems of Agricultural Cooperatives in South-East Serbia The analysis of transformational problems of agricultural cooperatives in the region of Stara planina is based on the qualitative research conducted in Research findings indicated presence of three types of cooperatives: inactive ones which were mostly remnants from old socialist cooperatives, those in the process of transformation, and newly established cooperatives. Three types were marked by different features, such as size, availability of land, facilities and other resources, structural characteristics and market orientation. Due to their differences in origin and features, they were facing various problems and obstacles: those related to the asset ownership, human resources and organization, economic, social networking problems, etc. One of the most prominent findings was the absence of any systematic support to their transformation. The outcome of such conditions is the waste of significant resources that could be used for rural development, particularly having in mind prevalence of small farming in the region. Key words: agricultural cooperatives, transformation, rural development

15 Miodrag Shrestha Coalition for Social Entrepreneurship, Belgrade Factors of Development of Social Entrepreneurship in Serbia The paper outlines the three stages in the development of the social entrepreneurship (SE). These stages are: Initial/Pioneering stage, Institutionalization stage and Differentiation/Developed stage. All the types in this typology have the same dimensions/factors but developed at different level. The most important factors are: Actors (social enterprises, CSOs, government, businesses), Legal Framework, Financial instruments/incentives, Awareness about SE among citizens, Networking/partnership, Management and other skills developed within SE, Serbia has passed through Initial stage very fast and it is now in the Institutionalisation stage. The paper explains the factors and their level of development through the case study of Serbia. Key words: social entrepreneurship, institutionalization, development.

16 Dušan Mojić Institute for Sociological Research, University of Belgrade The Role, Constraints and Potential of Cooperatives in Armenia Main goal of the paper was to study current state of the (mostly agricultural) cooperatives in Armenia. Because of the very high degree of integration into the Soviet economy, Armenian agriculture (and economy in general) experienced economic collapse during the transition period. The break-up of collective agriculture in Armenia led to more than 330,000 diversified farms, with lack of suitable machinery and equipment, water for irrigation and knowledge of good farming practices. All these reasons speak in favor of an important role and potential for agricultural cooperatives in Armenia. However, legislative constraints are still significant: although The Civil Code of Armenia deals with the issue of cooperatives, the actual Law on cooperatives still does not exist. In this paper, the role, constraints and potential of Armenian cooperatives were analyzed on the example of two case studies Noravan and Lukashin (both from Armavir marz administrative area or region). Both cooperatives are representative examples for the international financial and organizational aid, because a number of international supporting organizations became initiators for the establishment of agricultural cooperatives throughout the country, strengthening their financial, technical and social aspects (through various low-interest loan and grant programs, leasing, trainings and seminars). Key words: cooperatives, Armenia, agriculture, economy.

17 Narek Vardanyan, Vardan Urutyan ICARE, Armenia Cooperatives in Armenia: Lessons learned from Serbia and Italy Agricultural cooperatives have a long history of success and failures in developing and developed countries. Specialists, officials and other stakeholders in the field have many times emphasized the role of cooperatives in agricultural and rural development. A large number of international and national programs and measures taken have been focusing on the stimulation of the development of cooperatives in Armenia. Nonetheless, cooperatives remain underdeveloped and are far from being a part of the overall agricultural value chains. The reasons preventing cooperatives from success are versatile; however, they may be observed in legal, economic, informational, and sometimes in social-phsycological dimensions. This paper considers the necessity of a number of reforms aimed at the sustainable development of cooperatives, based on the experiences of Serbia and Italy as well as on the results of research and recommendations by the International Co-operative Alliance, International Labour Organization, UN, FAO, EURICSE and many other organizations. Key words: cooperatives, Armenia, rural development, reforms

18 Anatoly Kasyanenko ORACUL, Belarus Potential and Role of Social Enterprises in Belarus The social landscape of Belarus, innovation of the social legislation, potential and role of Social Enterprises are analyzed. Feature of the social landscape in Belarus is dual in its structure. There are 149 state territorial centers of social service; 1751 Belarusian NGOs carry out the mission in the social sphere. The innovation of legislation is the implementation of the Government social order in the social service sphere. The working models of the social enterprises in Minsk and Stolin are analyzed. Сonclusions: NGOs and social enterprises introduce practical experience in social administration and policy; it is necessary to use international standards in the sphere of social economy in the Belarusian legislation; it is necessary to distribute results of the international project RECOSET in the practice of the Belarusian NGOs and the SEs. Key words: social economy, NGOs, social enterprises

19 Sergey Sinyakin, Nina Yakovleva SESP, Ukraine Potential and Role of Social Enterprises in Ukraine Social entrepreneurship is a management system that consists of social enterprises, socially oriented business entities, whose activity is aimed at achieving of well-being for the territorial communities (social, ecological or ethical aims) through the use of systematic correlation for the social entrepreneurship and local economy development. According to the Ukrainian legislation the international criteria which define the enterprise as social are the next: 1. Social enterprise is founded with clearly specified social goal pointed in the Statute; profit gaining is not the main aim of this enterprise. 2. All the profit/income gained through economic activity or its strictly defined part (the biggest part), is systematically transferred to the community. 3. Social enterprise, unlike the other enterprises of social economy, should be under the control of community. In order to meet all the above mentioned criteria, it is obvious that the owner or co-owner (with a lager contribution share to the statutory fund) should be association of citizens, mainly non-profit non-governmental organization. In other words, social enterprise is the enterprise, established through the participation of citizens association that is the only owner or the co-owner of this enterprise. Key words: social enterprise, social economy, NGO, community

20 Luca Bettarelli EURICSE, Italy Selected Case Studies of Social Enterprises In Ukraine The Orange Revolution has attracted scholarships attention to Ukraine Civil Society Organizations (CSOs). Worldwide, while some observers concluded that Ukrainian CSOs should be well-developed in order to generate the momentum necessary for the revolution (Stewart, 2008), other more in-depth investigations brought the deep weakness of Ukrainian CSOs to light (Haward, 2003), to the extent that some authors have asserted that Ukrainian CSOs are merely a façade with very limited impact on local wellbeing (Satern, 2011; Allina-Pisano, 2010). Conversely, the ground research carried out in the framework of the RECOSET project has emphasized the existence of various vibrant Ukrainian CSOs that closely approach the idea of social enterprises. These social enterprise dynamics are mostly spontaneous phenomena that develop in remote settlements or peripheral areas to address needs of local people. This presentation focuses on certain good practices of social enterprise in Ukraine with the aim to investigate the main peculiarities in terms of legal forms adopted, sectors of activity and governance structure. Key words: social enterprise, Ukraine, Orange Revolution, CSOs