Tag Archives: Cooperative

Bringing platform cooperatives to Japan: Q&A with Mathias Sager (https://www.shareable.net/blog/qa-with-mathias-sager-founder-of-platform-cooperative-japan-consortium)

https://www.shareable.net/blog/qa-with-mathias-sager-founder-of-platform-cooperative-japan-consortium

Thanks to all PC(J) friends and Nithin from Shareable!

Promoting Cross-Cultural Cooperativeness in Global Talent Management (GTM)

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Content

  • Cooperative behavior arises where it is cherished
  • Cooperative conflict management
  • Means to promote cooperation
  • Equitable treatment to maintain willingness to cooperate

 

Cooperative behavior arises where it is cherished

Women are often considered to have a greater tendency to use their cooperativeness for successful international assignments, especially where indirect communication is the culturally appropriate style as is tendentially the case in high-context cultures like Asia [1]. Cooperative and communicative qualities (versus more competitive ones) have been attributed to woman stereotypically[2]. Research shows that cooperativeness depends a lot on the environment respectively the organization wherein it is more or less cherished.

Cooperative conflict management

Cooperative approaches to conflict exert positive effects on the relationship between employee and foreign manager, as a study also confirmed for the Chinese context [3]. As Western methods can create confrontations in transition economies, conflicting values and practices need to be resolved between different partners [4].

Means to promote cooperation

Different cultures should be recognized as different. A local-foreign social categorization can underline who needs help and who can provide the same [5]. There are other influenceable means to promote cooperation too. For example, cooperative goals for leaders aid cross-cultural leadership [6]. Focusing on long-term relationships and cooperation contributes to beneficial expatriate experiences [7]. Soft-skills-centric relationships (i.e., guanxi relationships in the East) result in an environment conducive to cooperative and positive interdependencies between coworkers [8].

Equitable treatment to maintain willingness to cooperate

If expatriates get advantaged, domestic employees might perceive inequitable treatment, which might impair their motivation, willingness to cooperate, and work performance; something HR and Global Talent Management (GTM) functions of multinational enterprises (MNEs) need to be aware of too [9].

 

References

[1] Tung, R. L. (1997). Canadian expatriates in Asia-Pacific: An analysis of their attitude toward and experience in international assignments. Paper presented at the meeting of the Society for Industrial and Organizational Psychology, St. Louis, MO.

[2] Jelinek, Mariann, a., & Nancy J. Adler, a. (1988). Women: World-Class Managers for Global Competition. The Academy Of Management Executive (1987-1989), (1), 11.

[3] Yifeng, C., Dean, T., & Sofia Su, F. (2005). WORKING WITH FOREIGN MANAGERS: CONFLICT MANAGEMENT FOR EFFECTIVE LEADER RELATIONSHIPS IN CHINA. International Journal Of Conflict Management, (3), 265. doi:10.1108/eb022932

[4] Danis, W. M. (2003). Differences in values, practices, and systems among Hungarian managers and Western expatriates: An organizing framework and typology. Journal Of World Business, 38(3), 224-244. doi:10.1016/S1090-9516(03)00020-8

[5] Leonardelli, G. J., & Toh, S. M. (2011). Perceiving expatriate coworkers as foreigners encourages aid: social categorization and procedural justice together improve intergroup cooperation and dual identity. Psychological Science, 22(1), 110-117. doi:10.1177/0956797610391913

[6] Yifeng, N. C., & Tjosvold, D. (2008). Goal interdependence and leader-member relationship for cross-cultural leadership in foreign ventures in China. Leadership & Organization Development Journal, 29(2), 144-166. doi:10.1108/01437730810852498

[7] Pfeiffer, J. (2003). International NGOs and primary health care in Mozambique: the need for a new model of collaboration. Social Science & Medicine (1982), 56(4), 725-738.

[8] Yang, F. X., & Lau, V. M. (2015). Does workplace guanxi matter to hotel career success?. International Journal Of Hospitality Management, 4743-53.

[9] Soo Min, T., & DeNisi, A. S. (2005). A local perspective to expatriate success. Academy Of Management Executive, 19(1), 132-146. doi:10.5465/AME.2005.15841966

Platform Cooperativism Japan (PCJ): The Future is Now

See also the embedded clip. As we concluded … Let’s cooperate! 🙂

Developing Distributed Leadership (DL) for Social Change

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(1) Distinct Co-operative Governance Challenges, (2) Distributed Leadership (DL), Self-awareness, Servant Leadership, and Safe Learning Spaces, (3) Empowerment for Service, Democracy, and Value-based Management, (4) Accountability for Strategic Leadership Processes: “Leading is a function, not a status.”

Distinct Co-operative Governance Challenges

Non-Governmental Organizations (NGO) and Co-operatives that are run according to cooperative principles, face distinct challenges compared to governments or for-profit organizations. About 90 percent of contemporary leadership research is not directly relevant for the NGO context. [1]. Furthermore, the available approaches to co-operative leadership need to be tailored according to organizational structure and maturity, economic sector, and membership size [2].

In a time of mystification and celebration of top-down leadership [3], capitalist shareholder dominance, and the absence of teaching foundations of cooperative democratic principles in schools, NGOs and Co-ops nevertheless continue to prioritize cooperation, especially by democratic and participatory principles that foster the inclusive membership’s well-being beyond pure business goals (Pinto, 2011). The cooperative governance model developed over decades by the CDS Consulting Co-op [29] has proven to provide leadership guidance to meet these unique needs by structuring governance elements into the four pillars of (1) teaming, (2) accountable empowerment, (3) democracy, and (4) strategic leadership. The following selected possible leadership program aspects are recommended to address the governance challenges of early-stage, still small cooperative organizations with a diverse and growing volunteering membership base.

Distributed Leadership (DL), Self-awareness, Servant Leadership, and Safe Learning Spaces

Protagonist leaders not sharing appropriately information are roadblocks to the active participation of co-leaders (e.g., other board members) and other members as everyone is supposed to participate in the democratic process [29]. Mutually owned solution development involving all stakeholders (i.e., diverse member categories and other stakeholders in a multi-stakeholder cooperative) cultivate creativity [28]. The risk of stakeholders pursuing their individual career goals at the cost of enhanced social networks and shared knowledge has to be prevented [16]. Cooperative enterprises require concerted collective action [17]. Such a collective capacity [1] is necessary to sustainably pool resources and know-how and can be addressed by the distributed leadership (DL) paradigm [18]. Co-ops may foresee to offer leadership education that is addressing the dimensions of DL, which are “bounded empowerment, developing leadership, shared decision and collective engagement” ([19], p. 693).

A higher self-awareness may be needed for individuals to make sense of the broader cooperative perspective [20]. DL suggests a culture of intensified inquiry among individuals [21] that can be positively influenced by increased self-efficacy, job satisfaction, and creative behavior among the members. A co-op can consider administering the validated DL instrument as the basis for its leadership development [22]. Especially at early stages of forming an organization, group coaching as proposed by Fusco, O’Riordan, and Palmer (2015) [23] to develop authentic self-leadership within the team can be an appropriate activity as well. Servant leadership characteristics showed global validity and could inform the coaching approach and the creation of safe learning spaces for experimentation [20], which can be of high value especially in multi-cultural and human-oriented communities [24].

Empowerment for Service, Democracy, and Value-based Management

It was a misbelief that paid Board members would remain solidary to volunteer work [4]. Rather, a study with students found that independent commitment to service provides for meaningful learning experiences and collaborative capacity building [5]. Democracy offers a meaningful collective leadership approach [6] that can enhance innovative behavior and commitment among the members who have the possibility for representation in the governance of the organization [7].

The members need to be offered the potential for own socio-economic success as a result from collective operation [8], best based on a stakeholder analysis allowing for alignment of different members’ incentives [9]. Engagement comes from understanding the purpose, vision, and values of the organization [10]. Indeed, value-based management helps to create a shared sense of belonging to all stakeholders [11], which is vital team-building success. More specifically, a formal value statement can help keeping up values required for shared leadership development. A clear positioning against external competition might eliminate internal competition [12], which can be achieved by training [13]. Another proposition is journaling to analyze how members experience their service contributions, a measure that has been able to confirmed the joy of service [14].

Accountability for Strategic Leadership Processes: “Leading is a function, not a status.”

Every minute of volunteering should be appreciated, and different levels of engagement between and within members over time accepted. Therefore, rather than defining and assigning roles and responsibilities to which it could be challenging to adhere to, accountability should be promoted. That way leaders can freely emerge without conflicts with non-matching role descriptions [2]. As Cannell (2018) [15] puts it aptly, “leading is a function, not a status.” Any, and especially also young members should be encouraged to self-nominate for leadership and management roles [16]. Technology can support strategy processes, planning, budgeting, member and associate management, as well as communication and media [25]. The Social Change Model of Leadership offers a framework on which leadership development programs could be built on to facilitate value-based collaborative group processes for social change [26] and the encouragement of new leaders [27].

References

[1] Dragoș – Cătălin, A. (2013). Non-Governmental Organization Leadership And Development. A Review Of The Literature. Manager, Vol 17, Iss 1, Pp 145-161 (2013), (1), 145.

[2] Whittle, K. (2018). Who’s afraid of leadership? Key lessons for co-op leaders. Retrieved from https://www.thenews.coop/125400/topic/business/whos-afraid-leadership-key-lessons-co-op-leaders/

[3] Bennis, W. (1999). The End of Leadership: Exemplary Leadership Is Impossible Without Full Inclusion, Initiatives, and Cooperation of Followers. Organizational Dynamics, 28(1), 71-79.

[4] Pinto (2011). Leadership, capacity building and governability in cooperatives. Swedish Cooperative Centre. Retrieved from http://www.un.org/esa/socdev/social/meetings/egm11/documents/Costa%20Pinto-Leadership,%20capacity%20building.pdf

[5] Dooley, J., & Shellog, K. (2016). Social change model of leadership development: A 20-year legacy and future considerations. Campus Activities Programming, 49(5), 20-25.

[6] Smolović Jones, S. )., Smolović Jones, O. )., Winchester, N. )., & Grint, K. ). (2016). Putting the discourse to work: On outlining a praxis of democratic leadership development. Management Learning, 47(4), 424-442. doi:10.1177/1350507616631926

[7] Rustin, M., & Armstrong, D. (2012). What happened to democratic leadership?. Soundings (13626620), (50), 59-71.

[8] Kuria, N. C. (2012). Harnessing the co-operative advantage to build a better world. United Nations Expert Group Meeting and Forum. Retrieved from https://social.un.org/coopsyear/documents/KuriaCooperativeLeadershipandGovernanceAddisAbaba.pdf

[9] Wilson, N. A., Ranawat, A., Nunley, R., & Bozic, K. J. (2009). Executive summary: aligning stakeholder incentives in orthopaedics. Clinical Orthopaedics And Related Research, 467(10), 2521-2524. doi:10.1007/s11999-009-0909-4

[10] Smith, C. (2015). Exemplary leadership: How style and culture predict organizational outcomes. Nursing Management, 46(3), 47-51. doi:10.1097/01.NUMA.0000456659.17651.c0

[11] Current state of research into co-operative management. Context, and future vision (2009). University of Leicester. Retrieved from www.pellervo.fi/pp/110esitykset/current_state_davis.ppt

[12] Maner, J. K., & Mead, N. L. (2010). The essential tension between leadership and power: When leaders sacrifice group goals for the sake of self-interest. Journal of Personality and Social Psychology99(3), 482-497.

[13] Tomlinson, C. A. (2017). Shining a Light on Leadership. Educational Leadership, 74(8), 91-92.

[14] Buschlen, E. L., & Reusch, J. (2016). The Assessment of Service Through the Lens of Social Change Leadership: A Phenomenological Approach. Journal Of College And Character, 17(2), 82.

[15] Cannell, B. (2018). Co-operative leadership: How should it work in practice? Retrieved from https://www.thenews.coop/125421/topic/business/co-operative-leadership-work-practice/

[16] Espedal, B., Gooderham, P. N., & Stensaker, I. G. (2013). Developing Organizational Social Capital or Prima Donnas in MNEs? The Role of Global Leadership Development Programs. Human Resource Management, 52(4), 607-625. doi:10.1002/hrm.21544

[17] Di Ruggiero, E., Kishchuk, N., Viehbeck, S., Edwards, N., Robinson, K., Riley, B., & Fowler, H. S. (2017). Alliance members’ roles in collective field-building: an assessment of leadership and championship within the Population Health Intervention Research Initiative for Canada. Health Research Policy & Systems, 151-11. doi:10.1186/s12961-017-0265-x

[18] Hristov, D. (2017). Distributed leadership : lessons from destination management organisations.

[19] Hairon, S., & Goh, J. P. (2015). Pursuing the Elusive Construct of Distributed Leadership: Is the Search Over?. Educational Management Administration & Leadership, 43(5), 693-718.

[20] Creating a learning environment for transformation: A case study of a course in sustainability leadership. (2013). Leading Transformative Higher Education Olomouc: Palacký University.

[21] Sloan, T. (2013). Distributed Leadership and Organizational Change: Implementation of a Teaching Performance Measure. New Educator, 9(1), 29-53.

[22] Jønsson, T., Unterrainer, C., Jeppesen, H., & Jain, A. K. (2016). Measuring distributed leadership agency in a hospital context. Journal Of Health Organization & Management, 30(6), 908-926. doi:10.1108/JHOM-05-2015-0068

[23] Fusco, T., O’Riordan, S., & Palmer, S. (2015). Authentic Leaders are… Conscious, Competent, Confident, and Congruent: A Grounded Theory of Group Coaching and Authentic Leadership Development. International Coaching Psychology Review, 10(2), 131-148.

[24] Hirschy, M. J., Gomez, D., Patterson, K., & Winston, B. E. (2014). SERVANT LEADERSHIP, HUMANE ORIENTATION, AND CONFUCIAN DOCTRINE OF JEN. Academy Of Strategic Management Journal, 13(1), 97-111.

[25] Sinclair, I., & Matlala, M. (2011). The use of technology and leadership in enhancing strategic cooperative policing within the SADC region. International Journal Of African Renaissance Studies, 6(1), 47. doi:10.1080/18186874.2011.592391

[26] Iachini, A. L., Cross, T. P., & Freedman, D. A. (2015). Leadership in Social Work Education and the Social Change Model of Leadership. Social Work Education, 34(6), 650-665. doi:10.1080/02615479.2015.1025738

[27] French, A. (2017). Toward a New Conceptual Model: Integrating the Social Change Model of Leadership Development and Tinto’s Model of Student Persistence. Journal Of Leadership Education, 16(3), 97-117.

[28] Broussine, M., & Miller, C. (2005). Leadership, Ethical Dilemmas and ‘Good’ Authority in Public Service Partnership Working. Business Ethics: A European Review, 14(4), 379-391.

[29] Cooperative Governance – 4 Pillars Cooperative Governance (n.d.). Retrieved from  http://www.cdsconsulting.coop/cooperative_governance/4pcg/

The Benefits of “Sharedness” in Leadership

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Summary. Shared leadership as part of modern transformational leadership style has proven to favorably influence team effectiveness and the achievement of an organizational balance between opportunity-seeking and advantage-seeking innovation, which positively impacts company performance. Mastery goal orientation (i.e., learning and development) rather than performance goal orientation (i.e., competition and social comparison) results in better group performance as required to solve complex problems. Therefore, questioning hierarchy and leadership is critically important to improve teamwork. High professional identification and altruistic and service-oriented goals are necessary for the successful development of collaboration competency and collective leadership.

Shared Consensus in Decision-Making in Animal and Human Studies

Unshared consensus and single leaders were assumed to be the norm in species like macaques and horses. However, studies have found that, in fact, also these animals take decisions based on consensus shared among group members [1]. In human leadership research, shared leadership (including collective and distributed leadership) as part of modern transformational leadership style evidently has a positive effect on team effectiveness [2]. Indirectly through the creation of organizational adaptability that enables finding the balance between opportunity-seeking and advantage-seeking innovation, shared leadership favorably influences company performance [3].

Leadership Style Depending on Relational Trust and Goal Orientation

In healthcare, flat hierarchies and shared decision-making structures that empower leaders on all levels, are suitable strategies to add to patient safety and employee well-being [4]; [5]. Learning is another area for which collaboration is beneficial [6]. Although the most effective way to enhance student achievement is the creation of professional learning communities, many middle schools still focus on managing test scores instead of enabling team learning processes in a collaborative learning environment [7]. Regarding tensions between official functions and citizens, for institutions like police departments, transformational leadership with a shared cooperative vision is imperative [8].

Trust was found to increase the likelihood of collaborative engagement between teachers [9], and to be a success factor for re-culturing schools [10]. Trust seems to be the necessary condition to enable the exchange of knowledge [11]. Shared information and knowledge elaboration allow diverse groups to develop practical solutions to challenging problems [12]. As studies in groups of children showed, leadership styles may depend on whether set goals are related to learning and development (mastery goal orientation) or competition and social comparison (performance goal orientation). Mastery orientation proved to contribute positively to shared responsibility and resulted in better group performance (i.e., solving a complicated math problem) than the performance condition in which lack of communication, member dissonance, and exclusion led to the use of forceful domination instead of cooperative leadership [13].

Challenging Hierarchy and Leadership to Improve Teamwork

Besides individual characteristics such as enthusiasm, vision, and knowledge, organizational culture, political situation, and member composition are influential factors for the development of shared leadership capacity [14]. Questioning hierarchy and leadership to improve teamwork [15] may be necessary but also challenging within traditional settings [16]. Group processes can be problematic for individuals who are used to concentrate high power [17]. Low professional identification as well as weak focus on, for example, patient safety or student success hinders support for shared leadership too [18]. Not insisting in mere self-reliance in information elaboration [12] and valuing altruism and service towards others are critically important for the successful development of collaboration competency and collective leadership [19].

References

[1] Bourjade, M., & Sueur, C. (2010). Shared or unshared consensus for collective movement? Towards methodological concerns. Behavioural Processes, 84(3), 648-652. doi:10.1016/j.beproc.2010.02.027

[2] Wang, D., Waldman, D. A., & Zhang, Z. (2014). A meta-analysis of shared leadership and team effectiveness. Journal Of Applied Psychology, 99(2), 181-198. doi:10.1037/a0034531

[3] Volberda, H., Jansen, J., Baagoe-Engels, V., , , , & … Volberda, H. W. (2014). Top Management Team Shared Leadership and Organizational Ambidexterity: a Moderated Mediation Framework. Strategic Entrepreneurship Journal, 8(2), 128-148.

[4] Moore, S. C., & Hutchison, S. A. (2007). Developing leaders at every level: accountability and empowerment actualized through shared governance. The Journal Of Nursing Administration, 37(12), 564-568.

[5] Chen, W., McCollum, M., Bradley, E., & Chen, D. T. (2016). Shared team leadership training through pre-clerkship team-based learning. Medical Education, 50(11), 1148-1149. doi:10.1111/medu.13170

[6] Landini, F., Vargas, G., Bianqui, V., Mathot y Rebolé, M. I., & Martínez, M. (2017). Contributions to group work and to the management of collective processes in extension and rural development. Journal Of Rural Studies, 56143-155. doi:10.1016/j.jrurstud.2017.09.014

[7] Thompson, S. C., & McKelvy, E. (2007). Shared Vision, Team Learning and Professional Learning Communities. National Middle School Association.

[8] Can, S. H., Hendy, H. M., & Can, M. E. (2017). A pilot study to develop the police Transformational Leadership Scale (PTLS) and examine its associations with psychosocial well-being of officers. Journal Of Police And Criminal Psychology, 32(2), 105-113. doi:10.1007/s11896-016-9204-y

[9] Thornton, K., & Cherrington, S. (2014). Leadership in Professional Learning Communities. Australasian Journal Of Early Childhood, 39(3), 94-102.

[10] Olivier, D. F., & Huffman, J. B. (2016). Professional Learning Community Process in the United States: Conceptualization of the Process and District Support for Schools. Asia Pacific Journal Of Education, 36(2), 301-317.

[11] Dearmon, V. A., Riley, B. H., Mestas, L. G., & Buckner, E. B. (2015). Bridge to shared governance: developing leadership of frontline nurses. Nursing Administration Quarterly, 39(1), 69-77. doi:10.1097/NAQ.0000000000000082

[12] Resick, C. J., Murase, T., Randall, K. R., & DeChurch, L. A. (2014). Information elaboration and team performance: Examining the psychological origins and environmental contingencies. Organizational Behavior And Human Decision Processes, 124165-176. doi:10.1016/j.obhdp.2014.03.005

[13] Yamaguchi, R. (2001). Children’s learning groups: A study of emergent leadership, dominance, and group effectiveness. Small Group Research, 32(6), 671-697. doi:10.1177/104649640103200601

[14] Nowell, B., & Harrison, L. M. (2011). Leading change through collaborative partnerships: A profile of leadership and capacity among local public health leaders. Journal Of Prevention & Intervention In The Community, 39(1), 19-34. doi:10.1080/10852352.2011.530162

[15] Van Schaik, S. M., O’Brien, B. C., Almeida, S. A., & Adler, S. R. (2014). Perceptions of interprofessional teamwork in low‐acuity settings: A qualitative analysis. Medical Education, 48(6), 583-592. doi:10.1111/medu.12424

[16] Lingard, L., Vanstone, M., Durrant, M., Fleming-Carroll, B., Lowe, M., Rashotte, J., & … Tallett, S. (2012). Conflicting messages: Examining the dynamics of leadership on interprofessional teams. Academic Medicine, 87(12), 1762-1767. doi:10.1097/ACM.0b013e318271fc82

[17] Hildreth, J. D., & Anderson, C. (2016). Failure at the top: How power undermines collaborative performance. Journal Of Personality And Social Psychology, 110(2), 261-286. doi:10.1037/pspi0000045

[18] Forsyth, C., & Mason, B. (2017). Shared leadership and group identification in healthcare: The leadership beliefs of clinicians working in interprofessional teams. Journal Of Interprofessional Care, 31(3), 291-299. doi:10.1080/13561820.2017.1280005

[19] Brown, S. S., Garber, J. S., Lash, J., & Schnurman-Crook, A. (2014). A proposed interprofessional oath. Journal Of Interprofessional Care, 28(5), 471-472. doi:10.3109/13561820.2014.900480

Implementing the Co-operative Digital Economy

When presenting Platform Cooperativism as a fairer user-/worker-owned model of running online platforms, I often hear answers like “that’s a great idea, but it’s too difficult to realize.” However, technology to implement the co-operative digital economy is emerging. Solutions become available to sustainably crowd-source, share value, and govern democratically. Hexalina.io is one such example.

(from hexalina.io website)

It is now generally admitted that income inequality is one of the biggest problems of our world and a peril to the fabric of our society.
A few years ago, the rise of the “sharing economy” gave great hopes to change this: soon everybody would be self-employed, and benefit from the new opportunities unlocked by the internet, technology and platforms.

Today, unfortunately, the reality is bleaker: millions of people have indeed become self-employed and provide the services that increase –sometimes dramatically- the value of these platforms thanks to the network effect they create and the customer adoption they generate.

However, neither the contributors, nor the customers of the platforms have the opportunity to own a share of the value they create.

A lot of people realize this is counterproductive and eventually unsustainable. However, there seems to be no easy solution that can address the problem and scale to match its rate of expansion.

What we propose is a technology that can be integrated into platforms, allowing them to adopt a more collaborative approach where interests of owners, customers and contributors are aligned, because a fraction of the created value is shared fairly between them.

Think of it as the “Fairtrade” label for a platform. We call it the “sustainable network effect”.

 

Industry adaption of Platform Cooperativism is the goal of the Platform Cooperativism Japan (PCJ) Consortium. Although awareness and motivation for the co-operative way is crucial, if there is no easy way to act upon, good intentions don’t get realized. That’s where technology solutions come into play.

The PCJ Consortium supports the cooperative digital economy through research, experimentation, education, advocacy, documentation of best practices, technical support, the coordination of funding, and events.

Connect with us:

Platform Cooperativism Japan (PCJ) Consortium
Website: www.platformjpcoop.wordpress.com
Facebook: www.facebook.com/platformcoopjp
Loomio: www.platformcoopjp.loomio.org

Leadership Philosophy Illustrated by the Example of Robert Owen, Pioneer of the Cooperative Movement

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What are your beliefs and perspectives regarding leadership? What do you think makes an effective leader? Illustrated by the example of Robert Owen, the acknowledged pioneer of the cooperative movement, a leader’s goal, effectiveness, and fellowship is assessed. The brief analysis bases on evidence from research in relevant leadership theories.

General Definition of Leadership

Many of the greatest villains in history were, in some way, successful leaders when the definition of leadership is considered independent of good or evil intentions [1]. In that sense, leadership is generally defined as the “ability to inspire confidence and support among the people who are needed to achieve organizational goals” ([2], p.2). In a capitalist economy, the most basic organizational goal is to compete for profits. Socially responsible and socially irresponsible behavior both are equally present in corporate environments as either of them is exerted only as long as they are underrepresented and therefore providing for a competitive advantage [3].

Robert Owen: Father of the Cooperative Movement & Transformational Leadership

I have chosen British man Robert Owen, who acknowledgedly spurred the cooperative movement as a visionary of cooperative values to address societal issues [4], such as improving labor conditions, reforming education, and banning child labor in factories [5]. Rather than relying on authoritarian power to keep people complying with leadership [1], Owen emphasized benevolence and the desire to promote the welfare of others [5]. Owen’s leadership style was, rather than transactional, much more transformational, i.e., visionary and appealing to people’s good nature [6]. Owen may be even an example of an authentic leader. Authentic leadership is one of the latest theories in the field and focuses leaders authenticity of values, trustfulness, and open communication [7].

Leadership as a Context-sensitive Process

While earlier leadership theories studied individual traits and behavior of leaders without appropriate attention to context [6], modern leadership research integrates bidirectional processes between leaders and followers that are context and time sensitive. [8]. As a reformer and pioneer of socialism in Britain, Robert Owen non-violently led change [9] that may have informed later human resource development (HRD) approaches towards fair and nurturing workplaces [10].  Owen’s communitarian society experiments like ‘New Harmony’ in the US became, albeit not directly achieving its aspirations, valuable for progress in scientific research and the co-operative movement. Owens inconsistency between his optimism to radically change society on the one hand, and his sense for the need of gradual change on the other hand, helped him to inspire a broad variety of different people over time [11]. Because of his persisting beliefs despite failure [11], his courage to lead, his rhetorical skills, and his progressive view on the determining impact of the environment on character contributed positively to Owen’s persuasiveness [12].

Leadership Grandiosity and Followers’ Motives

Some researchers put leadership facets like grandiosity into the context of a narcissistic personality type that is characterized by the belief of superiority in achieving social needs through the self-motive of helping others [13]. The propagation of the advent of a new moral world by the second coming of Christ as a common transatlantic aspect of Owenism [5] may have resonated with followers desire for psychological safety [14]. Other motives to follow the Owenite movement were community creation, self-employment, and exclusive and profitable business opportunities [15]. Figures like Ernestine Rose, an American representative of the women’s rights movement of the 19th century, became followers of Robert Owen because he helped them to reinforce their belief in the possible change towards a more just society [16].

Photo credit: Eliens (pixabay.com)

References

[1] Paschen, M., & Dihsmaier, E. (2013). The psychology of human leadership: How to develop charisma and authority. Berlin: Springer-Verlag.

[2] DuBrin, A. J. (2015). Leadership: Research Findings, Practice, and Skills (8th ed.). Cengage Learning.

[3] DeMaCarty, P. (2009). Financial Returns of Corporate Social Responsibility, and the Moral Freedom and Responsibility of Business Leaders. Business And Society Review: Journal Of The Center For Business Ethics At Bentley College, 114(3), 393-433.

[4] María Fernanda, L. G. (2013). La teoría sobre la naturaleza del hombre y la sociedad en el pensamiento de Robert Owen como base del socialismo británico (1813-1816) / Robert Owen’s Theory on the Nature of Man and Society as a Base for British Socialism (1813-1816) / A teoria sobre a natureza do homem e da sociedade no pensamento de Robert Owen como base do socialismo britânico (1813-1816). Historia Crítica, (50), 213.

[5] Harrison, J. C. (1968). THE OWENITE SOCIALIST MOVEMENT IN BRITAIN AND THE UNITED STATES. Labor History, 9(3), 323.

[6] Doyle, M. E., & Smith, M. K. (2001). Classical models of managerial leadership: Trait, behavioural, contingency and transformational theory. Retrieved from http://www.infed.org/leadership/traditional_leadership.htm

[7] Billsberry, J., & North-Samardzic, A. (2016). Surfacing Authentic Leadership: Inspiration from “After Life”. Journal Of Leadership Education, 15(2), 1-13.

[8] Dinh, J. E., Lord, R. G., Gardner, W. L., Meuser, J. D., Liden, R. C., & Hu, J. (2014). Leadership theory and research in the new millennium: Current theoretical trends and changing perspectives. Leadership Quarterly, 25(1), 36-62.

[9] Sirucek, P. (2015). Polozapomenute postavy ekonomickeho mysleni–Robert Owen. (Half-Forgotten Personalities of Economic Thought–Robert Owen. With English summary.). Acta Oeconomica Pragensia, 23(4), 78-85.

[10] Hatcher, T. (2013). Robert Owen: A historiographic study of a pioneer of human resource development. European Journal Of Training And Development, 37(4), 414-431. doi:10.1108/03090591311319799

[11] Mclaren, D. J. (1996). Robert Owen, William Maclure and New Harmony. History Of Education, 25(3), 223-33.

[12] Lambert, P. (1966). A New Light on Owen and Co-operatives of the Pre-Rochdale Type. Annals Of Public & Co-Operative Economy, 37(3), 305.

[13] Humphreys, J. )., Hayek, M. )., Pane Haden, S. )., Williams, J. )., Novicevic, M. )., & Gibson, J. ). (2016). Disharmony in New Harmony: insights from the narcissistic leadership of Robert Owen. Journal Of Management History, 22(2), 146-170. doi:10.1108/JMH-05-2015-0167

[14] Raes, E., Decuyper, S., Lismont, B., Van den Bossche, P., Kyndt, E., Demeyere, S., & Dochy, F. (2013). Facilitating Team Learning through Transformational Leadership. Instructional Science: An International Journal Of The Learning Sciences, 41(2), 287-305.

[15] Thornes, R. (1981). Co-operation and the English Working-class movement 1816-44. Bulletin — Society For The Study Of Labour History, (43), 4-5.

[16] Anderson, B. S. (2017). The New Moral World. Oxford University Press. doi:10.1093/acprof:oso/9780199756247.003.0003

Artooba: We’re building a co-operative platform to help artists showcase and sell their art in public places (Connect!)

We are coloring the world. Be part of the community already now and connect with us: https://www.facebook.com/artoobacommunity

We are also looking for partners and further team members. Contact us for any inquiries.

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(Platform) Worker Co-ops as a Solution for Business Ownership Successions. The Context in Japan.

mathias-sager-platform cooperativism Japan

Introduction

The percentage of employees employed by small and medium enterprises (SME’s) decreased from 80% to 70% in the last 20 years. Issues regarding the ownership succession of businesses are essential in the light of an aging society and the need for sustainable socio-economic development. The SME Cooperative Act of 1949 is for small and medium enterprises that lack financial resources in the conduct of joint businesses based on a spirit of mutual-aid to raise their economic status. The creation of a worker co-operative law would allow the further formalization of the opportunity of business conversions into worker cooperatives in any business sector. Business successions to employees would create a fairer economy where the trinity of ownership (investors), management (managers), and value creation/utilization (workers, users) is balanced for the benefits of its active membership.

Number of SME’s in Japan has fallen by 1 million during the last 20 years

It would be great if we could already discuss co-operative ownership succession of large organizations. However, I’m not aware of a “buy-twitter-initiative” in Japan so far. So, the more immediate opportunity for Platform Cooperativism may lie with small and medium businesses. Over the past 20 years, the number of SMEs in Japan has fallen by about 1 million and the number of SME employees decreased from 80% to 70% percent of overall employment (White Paper on Small and Medium Enterprises in Japan 2016). I am not sure how much the demographic challenges of the aging society would be the cause of such a decline in the digital sector especially, as increasing eliminatory market dominance of the big corporations is an inherent feature of many digital platforms.

Opportunity for ownership succession to employees

I experience that Japanese observers are regretting the disappearing of SME’s due to a lack of successful succession management. A similar issue represents the continuing rural exodus. There is mentioning of that when the business successions among SMEs are becoming issues, business successions to non-family persons, such as employees, are increasing (Kubota, 2010). So, I feel there are lots of opportunities to promote the co-operative way, although the predominant family business succession models are to the family or third parties other than employees and are separating ownership and management. Japan is currently still one of the few developed countries without a worker coop law, which is certainly not helpful.

For example, in agriculture, the succession and inheritance aspect is (globally) less researched because there is a view that family farming is heading towards extinction anyway. However, as still many farms are owned and managed by families, there may be renewed interest in intergenerational and intra- and inter-family cooperative solutions such as worker co-operatives.

Japanese business cooperation

Japanese small businesses are typically strongly cooperating and sub-contracting between companies, also for the rehabilitation of (struggling) small enterprises. There is a system of Small and Medium Enterprise Cooperatives based on the SME Cooperative Act from 1949, facilitating small and medium enterprises that lack financial resources in the conduct of joint businesses based on a spirit of mutual-aid to raise their economic status. The joint business cooperatives are, e.g., joint store associations, chain business associations, joint investing companies and voluntary groups.

The Japanese business system, also described as “co-opetition”, a mix of severe competition and collectivist Japanese culture, may be a fertile ground for #platformcoopjp. On the other hand, tendencies of specializing employees to contribute to a collective raise the question of how easily employees can assume initiative and more active (intrapreneurship) roles in case of becoming part of an employee-owned/managed organization.

https://www.facebook.com/platformcoopjp

The Platform Cooperativism Japan (PCJ) Consortium is continuing to collaborate and research for the exploration of opportunities in applying co-operative (platform) solutions to business successions and share the lessons learned also outside of Japan.

For an overview of Japanese socio-economic situation and the #co-operative landscape, please see the following articles (https://www.mathias-sager.com/2017/10/19/cooperatives-in-japan-article-series-overview/)

 

References

Ministry of Economy, Trade and Industry (2016). White Paper on Small and Medium Enterprises in Japan 2016. The Small and Medium Enterprise Agency

Kubota, N. (2010). 非親族承継における所有と経営の分離. 日本経営診断学会論集, 9145-151. doi:10.11287/jmda.9.145

[Net Neutrality] (Cyber) Territory Development: Owned by Landlords or by the People?

toll-independence-wilhelm-tell-switzerland-neutrality.png

The king has, in the struggle of defending his crown, given the virtual land to the landlords. Now the peasants pay the tolls to the privileged class who rules the online territory for the maximization of its own financial profits and influence. How will the insurgency look like? Time for (re-) new(-ed) alliances for effective and hopefully non-violent rebellion.

Part of the solution:

Platform Cooperativism Japan (PCJ)

Platform Cooperativism Japan (PCJ) connects key stakeholders of the emerging platform economy ecosystem to create synergies in the pursuit of increased shared value, ownership, and governance. The PCJ Consortium supports the cooperative digital economy through research, experimentation, education, advocacy, documentation of best practices, technical support, the coordination of funding, and events.

Inspiration from the History of Switzerland:

The Old Swiss Confederacy began as a late medieval alliance between the communities of the valleys in the Central Alps, at the time part of the Holy Roman Empire, to facilitate the management of common interests such as free trade and to ensure the peace along the important trade routes through the mountains. With the rise of the Habsburg dynasty, the kings and dukes of Habsburg sought to extend their influence over this region and to bring it under their rule. The foreign landlords collected tolls from bridges. Anti-Habsburg insurgences sprung up, but were quashed quickly. This time of turmoil prompted the Waldstätten to cooperate more closely, trying to preserve or regain their Reichsfreiheit. On August 1, 1291, an Everlasting League was made between the Forest Communities for mutual defense against a common enemy. The three founding cantons of the Schweizerische Eidgenossenschaft, as the confederacy was called, managed to defeat Habsburg armies on several occasion, and ensured a de facto independence from the empire. The Freibrief, or freedom charter, to “the people of the valleys,” recognized and formalized in law the independence from the Habsburg that they had gradually won in fact.

https://en.wikipedia.org/wiki/Growth_of_the_Old_Swiss_Confederacy, https://en.wikipedia.org/wiki/Swiss_neutrality

Platform Cooperativism Japan (PCJ): Intergenerational, Multidisciplinary, and Cross-Cultural

PCJ_Strategy_v01

Toot, no tweet anymore! Mastodon: The co-operatively run Twitter alternative

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Social networking, back in your hands

The world’s largest free, open-source, decentralized microblogging network

How awesome is that!

For more information, check: https://joinmastodon.org/

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Find your perfect community

Mastodon isn’t one place and one set of rules: it’s thousands of unique, interconnected communities to choose from, filled with different people, interests, languages, and needs. Don’t like the rules? You’re free to join any community you like, or better yet: you can host your own, on your own terms!

Take control of your content

With powerful tools to control who sees your posts and a 500-character limit, Mastodon empowers you to share your ideas, unabridged. The best part? All posts are in chronological order, not “optimized” to push ads into your timeline. With apps for iOS, Android, and every other platform imaginable, Mastodon is always at your fingertips.

Putting the user first

You’re a person, not a product. Mastodon is a free, open-source development that has been crowdfunded, not financed. All instances are independently owned, operated, and moderated. There is no monopoly by a single commercial company, no ads, and no tracking. Mastodon works for you, and not the other way around.

Feel safe in your community

Mastodon comes with effective anti-abuse tools to help protect yourself from online abuse. With small, interconnected communities, it means that there are more moderatorsyou can approach to help with a situation. This also means you can choose who sees your posts: friends, your community, or the entire fediverse.

Additional features

  • Robust anti-abuse tools
  • Flexible post filtering
  • A huge audience
  • Easily deploy your own
  • They’re called toots
  • Embed media in your posts
  • Built on open web standards
  • Spoiler warnings
  • You decide what’s relevant

 

Cooperatives in Japan (Article Series): Part 4/4 – Overview of the Japanese Cooperative sector

Overview and Conclusion article for Part 1 – Part 4, please see here.

In this article, several Japanese co-operatives of different types and from various sectors are briefly introduced. The goal is not to create a directory in the sense of a comprehensive list, but rather to distill essential characteristics of the co-operative sector and the solidarity economy in Japan. The facts presented in this article need to be understood in the context of the specific Japanese conditions and challenges as documented in Part 1, cooperative advantages as shown in Part 2, and the laws and customs applicable to the social economy in Japan as depicted in Part 3 of this article series.

Overview of Cooperatives in Japan 

japan coops infograph 1.pngInfographic 1. Overview of Cooperatives in Japan (1/2) [1]

japan coops infograph 2.pngInfographic 1. Overview of Cooperatives in Japan (2/2) [1]

Examples of Japanese Cooperatives

The examples chosen for the second part of this article do not represent a complete picture of the cooperatives in Japan. The selection, however, provides the opportunity to illustrate important characteristics of the cooperative economy in Japan across different types and various industry sectors in which co-operatives are operating. A focus is put on worker cooperatives as particularly relevant for digital businesses in the sharing economy (for further details, please see LINK Platform Cooperativism)

Table 1. Co-op examples by type

GeneralJapan International Cooperation Agency (JICA)
ConsumerJapan Consumer’s Cooperatives Union (Nisseikyo)
Seikatsu Club Consumers’ Co-operative Union
WorkerWomen’s Worker Cooperative (WWC)
Japan Worker’s Cooperative Union (JWCU)
Japanese Institute of Co-operative Research (JICR)
Seikatsu Club Consumers’ Co-operative Union’s Depot’s run by workers’ collective
Fukushi Club
Independent worker cooperatives
NPOs managed by workers’ collectivesAtsugi Human Support Network

Table 2. Co-op examples by industry sector

AgricultureNational Federation of Agricultural Cooperative Associations (ZEN-NOH)
Central Union of Agricultural Cooperatives (Nokyo)
Japan Agricultural Cooperatives (JAC, JAs)
FinanceAgricultural Cooperatives Credit Division (incl. the Central Agriculture Bank)
Mutual aid co-ops
The women and citizens’ community bank
Eitai Credit Union
Green Coop Fukuoka
Health, CareJWCU Home Helper Training Centers
Cooperative hospitals
Senior Co-operative (Koreikyo)
Ayumi Care Service
Fukuoka Elderly Person’s Co-op (EPC)
Enjoy Sports Club Uonuma
FoodChisan-Shisho movement
EcologyEcoTech
TransportWorkers cooperative taxi cab business in Fukuoka
Electronics R&DAssociation of Super-advanced Electronic Technology (ASET)
HousingCondominiums

In general, the Japan International Cooperation Agency (JICA) is an overarching organization that is collaborating with the Ministry of Education, Culture, Sports, Science and Technology in Japan, for example for research related to cooperation and co-operatives [2].

Co-op Examples by Type

Consumer Co-operatives

Japan Consumer’s Cooperatives Union (Nisseikyo)

The figures of the largest consumer cooperative in Japan are impressive with its 60 million members (of which the majority are women), it’s JPY 1 trillion (USD 10 billion) capital and annual sales of JPY 3 trillion (USD 30 billion) in 2,668 shops across all prefectures in the country. Because of lower prices, the organization is even importing vegetables and processed food. Because Nisseikyo’s members do not have a voice in the leadership of the company, it can’t be counted as being part of the real solidarity economy organization [3]. One of the exceptions among Japanese co-ops that can be seen to genuinely belonging to the solidarity economy is the Seikatsu Club Consumer’s Co-operative Union as presented next [3].

Seikatsu Club Consumers’ Co-operative Union 

The Seikatsu Club Consumers’ Co-operative Union is only a small part of Nisseikyo but has still 310,000 members in 29 co-ops across 19 prefectures. The Seikatsu Co-op won the Right Livelihood Award in 1989 [3].

Worker Co-operatives

Although worker-owned businesses have increased in number and size, only 30,000 workers are working cooperatively in whole Japan, with a concentration in the urban centers Kanto and Kansai. The growth since the 1970s is prolonged and small, compared to the overall working population [4] that is today around 76 million people. One problem that needs to be addressed is that there is no proper legislation for worker co-operatives in Japan [5] as detailed in Part 3 of this article series. Furthermore, the social movement may be not very well unified and orchestrated as some worker-owned organizations prefer the term ‘collective’ over ‘cooperative’ to emphasize the sovereignty of the individual [5]. It is though not only Japan struggling to grow the worker co-op movement. It is estimated that in the US around 350 worker cooperatives employ just 5,000 people [6].

If the cooperative worker movement doesn’t gain traction soon, it will, despite its proven potential, always stay marginal and irrelevant. Respectively it will be too late to solve the economic, social, and environmental issues resulting from cheap labor, inequality, and undemocratic practices by shareholder profit maximization that are aggravating from a global perspective.

Women’s Worker Cooperative (WWC)

The Women’s Worker Cooperatives with its 12,000 worker members accounts for the largest single group of organizations in the Japanese worker cooperative landscape. These WWC cooperatives allow the housewives to work part-time and therefore solve existing labor market constraints, tax issues, and equal employment opportunities, although they mostly don’t need the additional salary for a sufficient overall household income, albeit they are contributing significantly to the new middle-class lifestyle. The success of the WWC and the target women it helps to find suitable work indicates a huge potential of hundreds of thousands of Japanese women who might welcome such opportunities as well [4].

Japan Worker’s Cooperative Union (JWCU) 

After the WWC, the Japan Worker’s Cooperative Union (JWCU) represents with 9,000 members in 2005 the second largest account of worker cooperatives. The union innovatively remodeled itself into a business owned and democratically run by its workers who are provided with work contracts with an array of other organizations. “What had once been a labor union of the unemployed had been gradually transformed into a business owned and managed by its members as a worker’s cooperative [4, p. 7]”. The JWCU provides work crews into consumer co-op distribution centers, hospitals, and park cleaning and maintenance businesses. It has also expanded into more capital and knowledge-intensive industries such as home helper training centers and construction cooperatives [4]. Further examples are a high-school cooperative, a shoemaking collective, a bakery, and a theatrical company, etc. [5].

The JWCU publishes a newspaper ‘Rokyo Shimbun’ (Workers’ Co-op Newspaper) that is issued three times a month, and a bi-monthly magazine ‘Shigoto no Hakken’ (Discovery of Work), both of wich are promoting the worker co-ops activities in Japan and abroad [4]. The JWCU is pushing since years the agenda for adding a distinct worker-owned legal form to the currently available forms of personal ownership, partnership, and limited liability joint stock corporation. Hopefully, joint effort together with the WWC will make a new law possible. What would still be missing then is the mobilization of the young people who are currently underrepresented in the JWCU’s membership [4].

Japanese Institute of Co-operative Research (JICR) 

The Japanese Institute of Co-operative Research (JICR) was founded in 1991 by the JWCU. It serves as the central national and international research organization for its member activists and worker cooperatives. The Institute’s monthly journal ‘Kyodo no Hakken’ (The Discovery of Cooperation’ promotes worker cooperatives and their benefits for workers’ rights and communities’ thriving, including news from around the globe, with a traditional focus also on the European worker cooperative movement [4].

Seikatsu Club Consumers’ Co-operative Union’s Depot’s run by workers’ collective

The Seikatsu Club Consumers’ Cooperative contains various smaller groups like the ‘depots,’ which are run by members who organize as workers’ collectives built on democratic decision-making processes. The depots, therefore, constitute worker cooperatives within the broader Seikatsu consumer co-op. Such workers’ collectives’ membership basis is increasing fast [3].

Fukushi Club

The Fukushi Club is another group of workers under the umbrella of the Seikatsu Club Consumers’ Cooperative. In the Fukushi Club’s case, women who provide care organize as cooperative organizations to institutionalize the ‘shadow work’ and empower both the care receivers and providers [7].

Independent worker cooperatives

There are also some independently established Japanese worker cooperatives, such as the Paramount Shoe Company that was rebuilt through its union after a business failure. EcoTech that span off from the Toshiba conglomerate is another example of employee union initiated democratic worker cooperative [4].

NPOs managed by workers’ collectives

Atsugi Human Support Network

Only after 1998 citizens’ organizations could become legal entities through the NPO Promotion Law that started to encourage volunteering work for vulnerable people without tangible support though. Member housewives of the Seikatsu Club Consumer’s Cooperative in Atsugi city (Kanagawa prefecture) wanted to initiate a ‘local party’ to organize for local elections. The Atsugi Human Support Network became an alliance of 22 NPOs that are managed by workers’ collectives [3].

Co-op Examples by Industry Sector

Agricultural Co-operatives

National Federation of Agricultural Cooperative Associations (JAC Zennoh) 

The National Federation of Agricultural Cooperative Associations (JAC ZEN-NOH) with its 3 million national farm household members and the 12,500 employees is the world’s largest co-op organization [8]. It represents the top of the pyramid of the agricultural cooperatives organized on local, prefectural, and national level [9]. The JAC Zennoh is in charge of sales activities on the national level for its farmer’s co-operatives (JAC) members [10].

Central Union of Agricultural Cooperatives (JAC Zenchu, Nokyo) 

The farmer’s co-operatives (JAC) are organized under the Central Union of Agricultural Cooperatives (JAC Zenchu, Nokyo). The central union, as well as the farming co-operatives, don’t give voting rights to their individual members to participate in the leadership of the organization, which is organized like a corporation [3]. The JAC Zenchu is in charge of planning on national level for its JAC members [10].

Japan Agricultural Cooperatives (JAC, in short, the JAs)

It has to be differentiated between traditional village farming cooperatives, farmers’ groups organized as “cooperative farming groups,” and the members of the national entities JAC Zennoh and JAC Zenchu, which are the Japan Agricultural Cooperatives (JAs).

Financial Co-operatives

Agricultural Cooperatives Credit Division (incl. the Central Agriculture Bank)

The Agricultural Cooperatives Credit Division including the Central Agriculture Bank with the related prefectural credit unions providing mutual credit and insurance services are one of the most profitable operations of the Japanese agricultural cooperatives. Their members are farming-related organizations and non-farming individuals residing in cooperative communities [11].

Mutual aid cooperatives

The mutual aid cooperatives are organized into the national ‘Zenrosai’ federation and count 46,340 units. Although they use the terms mutual aid and cooperatives, they are not adhering to member voting rights and therefore instead have to be affiliated with commercial banks than with the solidarity economy [3].

The women and citizens’ community bank

These organizations are operated by women providing services exclusively for women, i.e., providing loans to according NPOs. In Japan, there is no legal status for non-profit citizen banks as this was so far not supported by governments, why the women and citizens’ community bank operates under a normal moneylender license [3]. However, problems in the commercial banking sector have increased the interest in the possibility to establish non-profit banks. There are now Shinkin (small and big loans) and Shinkumi (small loans) banks who provide services to citizens and SMEs [12], able to revitalize deprived communities [14], and which are of considerable importance in the Japanese financial market [13].

Eitai Credit Union

It is necessary to facilitate inter-cooperative mutual financial aid for developing the social economy. The Etai Credit Union in Tokyo is such an institution providing loans to cooperatives and collectives in consultation with NPOs [5].

Green Coop Fukuoka

Green Coop Fukuoka lends money to both member and non-member indigent people by using assets from members. The government of the prefecture Fukuoka is considering the initiative as crucial to develop financing of an inclusive society [15].

Health, Care

The government has encouraged co-operatives to provide welfare services as a business because they saw the rural and urban potential that could be unlocked from female care workers in the co-op memberships. Today, co-operatives make for about 1% of elderly care services provided under the Act for Long-term Care Insurance LTCI [16].

JWCU Home Helper Training Centers

Care for the elderly involves help at home. For the training of home helpers, the JWCU offers licensing programs that allow the certified home helpers afterward to reimburse their services through the national homecare insurance program [4].

Co-operative hospitals

In association with the Japan Communist Party, there exist member physician-run hospitals. These are the hospitals that were mentioned before as where JWCU worker co-operatives provide their hospital services such as cleaning, shop management, and office staffing [4].

Senior Co-operative (Koreikyo)

As of 2006 each of the Japanese prefectures had opened a Senior Co-operative (Koreikyo) chapter totaling in over 100,000 members nationwide with high growth expectations. The co-operative is, as the name is telling, by and for the elderly, supporting them to stay at home as long as possible and wished through education and home care [4].

Ayumi Care Service

In response to a shrinking and aging population, a 40-year-old woman set up a care business in her town in 2000. Ayumi Care Service today has 35 full-time workers, most of them member-owners who invested the equivalent of USD 500 as share capital and earn a monthly salary of around USD 1,700. Ayumi Care Services accepts any service requests, therefore being often caring about lonely elderly with no relatives and even taking care of difficult death situations [16].

Fukuoka Elderly Person’s Co-op (EPC)

Grown out of the JWCU workers’ co-operative movement, the Elderly Person’s Co-op (EPC), today there is a national federation of 22 EPCs with 45,000 members, of which 32,000 are workers. All the care workers are members, albeit the legal status of the co-op is a consumer cooperative. The services rendered include in-home and community-based care and vocational education for elderly and handicapped. The EPCs entered the LTCI scheme in 2000, and its members are rapidly increasing. Also, as many members did not have co-operative experience, the organization is investing a lot in cooperative education.

Enjoy Sports Club Uonuma

Although the Enjoy Sports Club Uonuma is instead a loosely defined interest group than a real co-operative, it is an excellent example of how citizens can organize to address social issues. In this case, the club achieved significant health prevention effects such as reduction of depression with children and elderly, addressing inactivity (especially in winter) with sports programs [17].

BioBank Japan (BBJ) Project

The BioBank Japan (BBJ) Project represents a cooperative research project implementing a patient-based biobank, having collected the medical data over a 5-year period from over 200,000 patients. The registry allowed the analysis of diseases for improved personalized medicine [18]. Although not a co-operative owned by the patients, it shows the potential of user cross-institutional collaboration and user registration for sharing health data for research purposes, as Midata.ch in Switzerland is a parade example of letting the data providers own and decide on the use of their data as co-op members.

Food

Chisan-Shisho movement

The chisan-chisho movement promotes local food consumption since the 1990s as a response to the concern of disappearing local farms and scandals in the food sector. The initial grass-roots movement is today organized by government and farmers’ cooperatives. Despite its success, the chisan-chisho still needs to find additional ways on how to better capitalize on the local appeal of agrifood to become a more powerful political force [10].

Ecology

EcoTech 

EcoTech is an interdisciplinary co-operative that unites scientists, engineers, technicians, business people, and advocates for co-operatives and community activists. They create energy-efficient products that help clean the environment. An example of EcoTech’s international products is the bio-active home composter that decomposes organic waste into water and CO2. EcoTech has the aspiration to become the center of a social business movement including all industry sectors and types of players, including worker, consumer, and producer cooperatives [4].

Transport

Workers cooperative taxi cab business in Fukuoka

Similar to counterparts in different cities around the world, a taxi cab business emerged as a worker cooperative in Fukuoka, as also the Research Institute’s journal was reporting already in 2005 [4].

Electronics R&D

Association of Super-advanced Electronic Technology (ASET)

The Association of Super-advanced Electronic Technology (ASET), a Japanese electronics R&D co-op headquartered in Tokyo, got USD 300 million in Japanese government funding for research on semiconductors, magnetic storage, and display devices.

Housing

After the economy bubble from the late 1980s when it became difficult to purchase land, housing “rental-type” co-operatives in the form of condominiums became popular. The system is favorable for letting elderly living in their apartments although they do not own it [19].

Conclusion

After the study of cooperative examples in Japan in the context of identifying success factors for promoting the co-operative organizational form for a fairer future of work, the following points seem important to keep in mind for future efforts to advance the cooperative and social economy overall:

  • Worker co-operatives need to get a clear and supportive legal basis in Japan, and themselves need to develop strategies to gain influence on the social agenda [5].
  • I think it should be more clearly distinguished when using the term co-operative, as in cases of so-called big Japanese co-ops that do not grant member’s a voice in the leadership of the organization. One member one vote is, however, the most vital element of cooperative governance as only ownership and decision rights are effectively empowering the contributing citizen members.
  • Although the young people are primarily affected by the challenging labor market, they don’t seem to be connected to the worker cooperative movement. Some few examples constitute JWCU worker groups consisting of primarily young people [4]. For co-operatives to be successful, they need to be able to speak to the youth not only as volunteering organization but as a competitive better alternative to the neo-liberal capitalist economy.
  • Increasing the awareness about co-operatives should be a priority as often the young people just don’t know about its possibilities [4].
  • Millennials may appreciate opportunities for work-life balance. Co-operatives might be able to provide such a balance in addition to purpose and identification. Furthermore, co-operative governance can be designed to reward performance, therefore supporting personal growth in any ways.
  • Solidarity between older and younger generation should also enable financing of co-operative start-ups of young people by the member funding of older more affluent people. Social impact investment should account for such opportunities.
  • While grass-roots efforts are essential, the co-operative way should also be supported top-down as a political priority. A co-operative economy can not only be profitable but by not passing excess profits to just a few it is also able to provide for welfare benefits and community development where often tax paid government efforts failed in demonstrating sufficiently sustainable effects.
  • All the co-operative seeds should be honored, but it has to be stated that the co-operative economy is negligible and toothless compared to the overall economy. There is no reason for the co-operative movement to rest on its laurels.
  • Implementing democracy in organizations by giving the member-owners (and employees) a voice and a share are just natural. Therefore, the co-operative way, rather than being an extreme alternative movement, has the potential to be common sense across many political directions.
  • Inter-cooperative cooperation is crucial to bundle the efforts for maximum effect on the growth of the movement. While modest scale for NPOs in welfare services and the solidarity economy is a positive feature, big-scale commercial markets have to be given back from shareholder exploitation to the citizens. Any business can be organized co-operatively.

 

References

[1] International Cooperative Year Commemorative Cooperative National Council (n.d.). Welcome to the Cooperatives Japan Website. Retrieved from http://www.iyc2012japan.coop/whatsnew/101217_01.html

[2] Mizuta, D. D., & Vlachopoulou, E. I. (2017). Satoumi concept illustrated by sustainable bottom-up initiatives of Japanese Fisheries Cooperative Associations. Marine Policy, 78143-149. doi:10.1016/j.marpol.2017.01.020

[3] Kitazawa, Y. (2010). Japan’s lost decades and a women-led socio-solidarity economy. Development, 53(3), 416-420. doi:10.1057/dev.2010.46

[4] Marshall, B. (2006). Japan’s worker co-operative movement into the 21st century. Asia-Pacific Journal: Japan Focus, (23),

[5] Ishizuka, H. (2002). The Social Economy Sector in Japan. Annals Of Public & Cooperative Economics, 73(2), 241.

[6] Abello, O.P. (2016, January). NYC Set to Triple Number of Worker Cooperatives. Retrieved from https://nextcity.org/daily/entry/nyc-worker-cooperatives-jobs-increase

[7] Lord, A., & Mellor, M. (1996). Women and the cooperative provision of care: the example of the ‘Fukushi Club’ in Japan. Economic And Industrial Democracy, 17(2), 199-220.

[8] Chesnick, D. S., & Liebrand, C. B. (2007). Global 300 list reveals world’s largest cooperatives. Rural Cooperatives, 74(1), 28-31.

[9] Gherman, R., Dincu, A., Milin, A., & Brad, I. (2016). Agriculture and Agricultural Cooperatives in Japan – A Model for Cooperativization of Agriculture from Romania. Scientific Papers: Animal Science & Biotechnologies / Lucrari Stiintifice: Zootehnie Si Biotehnologii, 49(2), 212-216.

[10] Kimura, A. H., & Nishiyama, M. (2008). The Chisan-Chisho Movement: Japanese Local Food Movement and Its Challenges. Agriculture And Human Values, 25(1), 49-64. doi:http://dx.doi.org.liverpool.idm.oclc.org/10.1007/s10460-007-9077-x

[11] Klinedinst, M., & Sato, H. (1994). The Japanese Cooperative Sector. Journal Of Economic Issues (Association For Evolutionary Economics), 28(2), 509.

[12] Glass, J. C., McKillop, D. G., Quinn, B., & Wilson, J. S. (2014). Cooperative Bank Efficiency in Japan: A Parametric Distance Function Analysis. European Journal Of Finance, 20(1-3), 291-317.

[13] Yamori, N., Harimaya, K., & Tomimura, K. (2011). The Roles of Outside Directors in Cooperative Financial Institutions: The Case of Japan. Banks And Bank Systems, 6(4), 11-14.

[14] Chris, M., & Sachiko, N. (2010). How can co-operative banks spread the spirit of co-operation in deprived communities?. Social Enterprise Journal, (2), 162. doi:10.1108/17508611011069284

[15] Sachiko, N. (2015). A ROLE OF SOCIAL FINANCE BY A COOPERATIVE: A CASE STUDY OF GREEN COOP FUKUOKA, JAPAN. ACRN Oxford Journal Of Finance & Risk Perspectives, 4(3), 1-18.

[16] Kurimoto, A. )., & Kumakura, Y. ). (2016). Emergence and evolution of co-operatives for elderly care in Japan. International Review Of Sociology, 26(1), 48-68. doi:10.1080/03906701.2016.1148341

[17] Iguchi, S., Niwayama, M., & Takahashi, H. E. (2015). A conference report of the interprofessional satellite symposium in Uonuma, Japan: an international exchange on the future of community care. Journal Of Interprofessional Care, 29(3), 284-287. doi:10.3109/13561820.2014.966541

[18] Nagai, A., Hirata, M., Kamatani, Y., Muto, K., Matsuda, K., Kiyohara, Y., & … Kubo, M. (2017). Overview of the BioBank Japan Project: Study design and profile. Journal Of Epidemiology, 27(3S), S2-S8. doi:10.1016/j.je.2016.12.005

[19] Ekuni, T., & Jung, J. (2015). 日本初の賃貸型コーポラティブハウスの居住者主体による賃貸システム 改変の変遷に関する研究. 都市住宅学, 2015(91), 124-129. doi:10.11531/uhs.2015.91_124

Cooperatives in Japan (Article Series): Part 3/4 – The Japanese Social Economy, Policymaking, and Co-operative Governance

The “Third Sector” (Social Economy)

Overview and Conclusion article for Part 1 – Part 4, please see here.

The “third sector,” or social economy, is the space of social issues that are left by government and private sector (corporate) failures. It is the arena in which the two actors after-negotiate how to share the burden to resolve the problems they feel could fire back if not addressed.

 mathias-sager-social-economu.jpg

Japanese governmental statistics (SNA, System of National Account) defined ‘industry’ as for-profit businesses only until 1998, why there was no clear concept for a non-profit organization (NPO) [1]. Since then the NPO Law allows civil society organizations to easily acquire nonprofit corporation status [10]. The social sector represented by non-governmental organizations (NGOs), NPOs, and cooperatives is thought to cover social problems like community development, environmental protection, and social movements. Unlike informal associations, NGOs, and NPOs, cooperatives are the only organizational form that represents the ‘Institutionalized’ Social Economy. Therefore, the cooperatives should be assigned a leadership role in the social economy sector. In Japan, the caption NPO is more prominent than social economy [1].

Cooperatives are by definition only a resource for their members; they cannot take the place of the state as a universal provider, without having the responsibilities and resources of the state [14].

In East Asian countries state influence on social enterprises including cooperatives has been stronger than in other regions. This bears the risk for social organizations to lose independence from public agencies. Another threat is that businesses focusing on financial independence and market performance can lose sight of their social responsibility [2]. This might be less the case for cooperatives that are consequently governed of, by, and for their active members.

Positioning of social enterprise for three regions

Figure 1: Positioning of social enterprise for three regions [2]

The “ideal-type” social enterprise underlines a participatory dynamic in the governance structure [2].

As the social enterprise concept is starting to further develop in Eastern Asia, it is essential to answer the question about the most suitable governance model. It was found that in Eastern Asia, even more than in the US, a participatory governance model, and cooperative principles inspired organizational forms could represent the ideal-type of autonomous social organizations. More innovative and flexible types such as, for example, multi-stakeholder cooperative models require more research and experience [2].

Cooperatives are always “collectives” as they involve member participation in the governance structure. But “collectives” don’t necessarily provide for member ownership structures as inherent in the co-operative. The same is true for so-called buying (or other) clubs whose members carry out an activity together, whether organized as an NPO social club or as a cooperative.

There is simply no easy, legal way to organize worker co-operation in Japan yet, and this must surely be a barrier to their spread [3, p. 16].

Co-ops in Japan are traditionally regulated by sectors, e.g., the Consumer Co-operative Act (1948), The Agricultural Co-operative Act (1947), and the Fishery Co-operative Act (1948). Worker cooperatives are particularly promising to address inequality of income and opportunity, as well as for employee motivation, performance, and in-house innovation. However, in Japan, they lack legal recognition, why worker members often organize in organizations incorporated under the Small and Medium-sized Enterprise (SME) Co-operative Act (1949) or the NPO Act [4]. In other words, it is not forbidden anymore for workers to cooperate for consumption, credit and marketing purposes, but there is also no law positively supporting such aspirations. That’s the reason why the Japan Institute for Cooperative Research (JICR) does promote a new worker law [3].

As discussed in the article “Japanese Cooperatives: Part 1 – Challenges” too, Stock Ownership Plans are not available in Japan to restructure ownership, and the requirements for establishing a joint stock corporation are difficult in Japan as elsewhere. An unusual but clever way went the Senior Cooperative “Koreikyo” that is a consumer co-operative assuming features of a worker co-operative. A currency-like ticketing system achieves the hybrid type of cooperative operation. Members buy books of tickets and use the tickets for paying for co-op services. The services providers redeem later the collected tickets to cover their compensation [3].

Policy Making in Japan

The labor market in Japan has become more challenging. Besides vocational education, career coaching, and traditional start-ups, a new system to incorporate NPOs and worker cooperatives should be prioritized by policy makers [5]. Other countries are also starting to invest more than ever into the development of worker cooperatives that foster dignity and wealth for all as the example of New York initiative for tripling the number of worker cooperatives shows [6]. Also, the conflict between fiscal policy constraints and social policy development can be best resolved by developing the social economy sector and mobilizing its resources and communities [1].

Contracted employees today in Japan don’t enjoy a legal basis that is protecting them as employees; the Civic Code needs still to be adjusted for protective provisions going beyond a service contract and including social welfare for contractors who in fact are engaged in work as employees [5].

The “iron triangle” of Liberal Democratic Party (LDP) politicians, bureaucratic ministries, and vested interest groups—still represents a formidable and functioning element of Japan’s central governing process [7].

Regarding policy making it was found to be challenging to get access to locked circles of party-bureaucracy-interest-group policymaking in economic and social sectors. This situation stemmed mainly from the example of closed-door decision making in the agricultural policy triangle. The Japan Agricultural Cooperatives (JA) reform intended to no longer view the JA as the sole voice of the farming sector and to reduce JA’s most dominant position as a pressure group. The reform is considered to be radical, but ultimately also quite limited in its effect [8]. The differing interests of large international corporations and the local small-scale businesses (farmers) have slowed down (agricultural) policy reforms. Therefore, the JA-Zenchu will likely remain the most powerful and influential interest group in Japanese politics [9]. However, the autonomy of JA is limited too because of its traditional receipt of state donations [1].

Co-operative Governance

Cooperatives are guided by their identity, values, and principles.

Co-operative Identity: A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically-controlled enterprise [10].

Co-operative Values: Co-operatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, co-operative members believe in the ethical values of honesty, openness, social responsibility and caring for others.

Co-operative principles: 1. Voluntary and Open Membership, 2. Democratic Member Control, 3. Member Economic Participation, 4. Autonomy and Independence, 5. Education, Training and Information, 6. Co-operation among Co-operatives, 7. Concern for Community

In general, cooperative governance can be clarified with a model of four pillars.

TeamingSuccessfully working together to achieve common purpose
Accountable EmpowermentSuccessfully empowering people while at the same time holding them accountable for the power granted.
Strategic LeadershipSuccessfully articulating the cooperative’s direction/purpose and setting the organization up for movement in this direction.
DemocracySuccessfully sustaining a culture in which people choose meaningful ways to participate for both individual and common good.

Table 1. The four pillars of cooperative governance [11]

When a co-operative bank acts as “community organizer”, undertaking tasks which are outside its usual sphere of activities as financier, and its board includes members of the social enterprise sector, its positive impact on community development is more effective [13, p. 162].

Capable management is important. Some literature from Japan reports on the need in different sectors for cooperatives to upgrade their management methods [1]. According to research in 2006, 63% of past co-operative bankruptcies were due to management problems. It was also found that the presence of outside director on the board of directors had a positive influence on management performance. However, there is usually no pressure from the membership to require outside directors. Therefore, some suggest that authorities such as the Financial Services Agency (FSA) shall stress this need [12].

To make raising equity for cooperatives easier, it appears to be important to understand the nature of the transferable membership capital method [15].

In general, it is known that cooperatives have it harder to get funding as compared to traditional capitalist businesses [15], although there are signs that social impact capital, or purpose capital, is on the rise. Indeed, co-op member’s favorite survey response to work at a co-operative was the one of seeking “ikigai”, i.e., “a purpose in life” [3]. It might be, as a general pattern, that where the money can come from, capitalist monetary values predominate social considerations. Therefore, due to limited profit maximization for single individuals, limited financing is a significant growth limitation for the cooperative economy, although a membership market could provide for the same economic potential. To solve this problem, some cooperatives have resorted to the method of issuing transferable membership capital, e.g., a housing cooperative raising equity capital by issuing shares and investing it in the construction projects, and after that trading the shares on the open market [15]. It is also necessary to create financial mutual aid systems in the social economy such as initiatives started by the Eitai Credit Union in Tokio [1].

How independent are SME’s in Japan?

Japanese SME’s for their survival need to form alliances with major firms that are dominating the markets. Subcontracting is so extensive in Japan that SME’s independence needs to be questioned. Such domestic loyalty networks often served as de facto trade barriers [16] and also need to be taken into account by any new co-operative businesses.

What is needed for the solidarity economy in Japan is to form loose networks, like the Atsugi Human Support Network, at the regional, national and global levels, and to engage in political action to fight against neo-liberalism [17].

Often genuinely collaborative loose networks do, tragically, not evolve without exceptional circumstances. For example, The Emergency Job Creation (EJC) program as a response to the 2011 Great East Japan Earthquake disaster achieved the collaboration among stakeholders as diverse as NPOs, NGOs, social welfare corporations, and other companies [18]. It is to hope that the solidarity economy can be more successfully promoted in the future on local, regional, and global level [17]. Ways must be found how to convince also private corporations who currently value monetary profit instead of social orientation to contribute to solidarity more consequently [1].

As per the co-operative governance principle of cooperation among cooperatives, it is critical to act on this aspect more intensively. Shared interests and synergies can be used better to intensify inter-cooperative cooperation. For example, all forestry, agriculture, consumer, and fisheries have been concerned about improved water environments. Similarly, any cooperative as connected to the member-community can facilitate access to and provision of in-home services such as healthcare together with other cooperatives [1].

the extension of the coop movement.png

The Japanese Cooperative Council (JCC) links to the International Co-operative Alliance (ICA), a similar systematic national connector is missing [1]. For the cooperatives and related organizations in the broader digital economy, the Platform Cooperativism Japan (PCJ) Consortium has started to assume such a role. There is the risk that cooperatives appear old-fashioned in the eyes of the younger generations. Increased openness, exciting and influential networks of co-operatives might be a means to rejuvenate and strengthen the movement. Academia and national innovation networks that dare to learn from and promote to an also international dimension [19] may play a vital role in that journey too.

 

References

[1] Ishizuka, H. (2002). The Social Economy Sector in Japan. Annals Of Public & Cooperative Economics, 73(2), 241.

[2] Defourny, J., & Kim, S. (2011). Emerging models of social enterprise in Eastern Asia: a cross-country analysis. Social Enterprise Journal, 7(1), 86. doi:10.1108/17508611111130176

[3] Marshall, B. (2006). Japan’s worker co-operative movement into the 21st century. Asia-Pacific Journal: Japan Focus, (23),

[4] Kurimoto, A. )., & Kumakura, Y. ). (2016). Emergence and evolution of co-operatives for elderly care in Japan. International Review Of Sociology, 26(1), 48-68. doi:10.1080/03906701.2016.1148341

[5] Nogawa, S. (2012). The Great East Japan Earthquake and a Future Vision for Labor Law in Japan. Japan Labor Review, 9(4), 105-123.

[6] Abello, O.P. (2016, January). NYC Set to Triple Number of Worker Cooperatives. Retrieved from https://nextcity.org/daily/entry/nyc-worker-cooperatives-jobs-increase

[7] Mulgan, A. G. (2016). Loosening the ties that bind: Japan’s agricultural policy triangle and reform of cooperatives (JA). Journal Of Japanese Studies, 42(2), 221-246.

[8] Mulgan, A. G. (2016). Much ado about something? The Abe government’s reform of Japan’s agricultural cooperatives (JA). Japanese Studies, 36(1), 83-103.

[9] Jamitzky, U. (2015). The TPP Debate in Japan: Reasons for a Failed Protest Campaign. Asia Pacific Perspectives, 13(1), 79.

[10] International Co-operative Alliance (n.d.). Co-operative identity, values & principles. Retrieved from https://ica.coop/en/whats-co-op/co-operative-identity-values-principles

[11] CDS Consulting Co-op (n.d.). Four Pillars of Cooperative Governance. Retrieved from http://www.cdsconsulting.coop/cooperative_governance/4pcg/

[12] Yamori, N., Harimaya, K., & Tomimura, K. (2011). The Roles of Outside Directors in Cooperative Financial Institutions: The Case of Japan. Banks And Bank Systems, 6(4), 11-14.

[13] Chris, M., & Sachiko, N. (2010). How can co-operative banks spread the spirit of co-operation in deprived communities?. Social Enterprise Journal, (2), 162. doi:10.1108/17508611011069284

[14] Lord, A., & Mellor, M. (1996). Women and the cooperative provision of care: the example of the ‘Fukushi Club’ in Japan. Economic And Industrial Democracy, 17(2), 199-220.

[15] Mikami, K. (2015). Raising Capital by Issuing Transferable Membership in a Consumer Cooperative. International Journal Of Social Economics, 42(2), 132-142.

[16] Dana, L. P. (1998). Small but Not Independent: SMEs in Japan. Journal Of Small Business Management, 36(4), 73-76.

[17] Kitazawa, Y. (2010). Japan’s lost decades and a women-led socio-solidarity economy. Development, 53(3), 416-420. doi:10.1057/dev.2010.46

[18] Nagamatsu, S., & Ono, A. (2017). Job Creation after Catastrophic Events: Lessons from the Emergency Job Creation Program after the 2011 Great East Japan Earthquake. Japan Labor Review, 14(1), 112-131.

[19] Miotti, L., & Sachwald, F. (2003). Co-operative R&D: Why and with Whom? An Integrated Framework of Analysis. Research Policy, 32(8), 1481-1499. doi:http://dx.doi.org.liverpool.idm.oclc.org/10.1016/S0048-7333(02)00159-2

[20] About NPO Law (n.d.). How the NPO Law came about and why it is important. Retrieved from http://www.jnpoc.ne.jp/en/nonprofits-in-japan/about-npo-law/

Cooperatives in Japan (Article Series): Part 2/4 – Cooperative Advantages

Overview and Conclusion article for Part 1 – Part 4, please see here.

To make it clear right up front: cooperation isn’t just an idea; it is instead a universal need and natural law for human thriving, be it in one’s spiritual connections, interpersonal relations, or business matters. Member-owned cooperative organizations as they are institutionalized are not only an alternative to shareholder directed corporations; they are necessary for a fairer working world. The cooperative values and principles have the potential to let the pendulum switch from the pure capitalist to the cooperative inclusive side. Just, the few powerful and wealthy who are profiting so immensely from the current system won’t give up their privileges for the benefit of more people. However, there are so many reasons why co-operatives are the better way for all to organize any endeavor and business. Once the movement gained traction, people will wonder how it was at all possible to accept undemocratic, inequitable and unsustainable practices around the world that caused so much injustice and destruction for such a long time. Therefore, the shift will mark a real evolutionary step. Now that the digital age is at a cross-road how to be organized in the future (see Platform Cooperativism), we have an opportunity to decide on the overall direction of society, not only in the virtual world. The following article outlines some main points that make the fairer co-operative way preferable to the extractive capitalist system from both economic, social, and environmental perspectives.

Socio-ecological integration enhances not only the long-term sustainability of businesses but also supports environmentally conscious consumption. [1]

“Sato” in Japanese means the area where people live, and “umi” means the sea. ‘Sato-umi’ describes a holistic approach that fosters sustainable and competitive human-ecosystem interaction with the result, as demonstrated by the Fisheries Cooperative Associations (FCAs), of increased biodiversity and productivity and consequently a healthier environment and economic ecosystem. Sato-umi may be unique in how established the practices are: therefore, ready to be further spread in Japan and promoted globally [1]. Many of the advantages of the cooperative way presented in this article may be linked or linkable to Sato-umi. It seems most important to further seek a best of all approach by building on existing (Japan specific) strengths and mitigating weaknesses to elevate the cooperative movement to the next level.

sato-umi.jpg

Source: satoumi.net

Satoumi-related activities promote lifelong learning opportunities, social and economic inclusion, and equality within communities and countries. Long-term involvement nourishes the desire to protect and promote through innovation, and harmony between human and ecosystem factors foster collaboration [1].

Acting as a rural development agency, the government makes loans to the farmers at a low interest rate through the cooperatives, which is called a ‘system loan’ [2, p. 512].

One of the primary services of agricultural co-ops in Japan is mutual credit and insurance that helps develop agrarian projects and the industry overall. Cooperatives can stimulate the cooperative sector by providing low-interest rate system loans [2]. Such investments may bear lower profits in the short term, but cooperatives have proven that, by benefitting their members instead of their investors, they are fitter for the long-term survival of the business [3].

Cooperatives continued to extend their successful operations even 30 years in business in highly competitive service industries through times of stagnation in Japan’s national economy [5].

Locally anchored participatory businesses demonstrate sustainable productivity through a combination of traditional knowledge and innovation [1]. The instability that is all too often a tendency of new and small businesses can be mitigated by a cooperative working style. For example, the Seikatsu Club Consumer Co-operative grew their services sustainably from the 1980s to over a quarter of a million members already in 2006. Among the members mostly women who otherwise have difficulties to find suitable work (see article “Japanese Cooperatives Part 1 – Challenges“), against all the adverse economic conditions that caused other businesses to stagnate or even collapse in the same competitive sectors [4]. Evidence shows that firms which combine employee ownership and participatory governance outperform other companies [5].

mathias-sager about seikatsu club japan.png

How to build the necessary new extensive welfare services while keeping corporations unaccountable and taxations low? 

Where the government nor the private sector want to compensate for welfare services, cooperatives (besides various private firms and NPOs) fill gaps by establishing flexible strategies such as ‘registered helpers’ who are rendering services as paid volunteers, ‘mutual assistance schemes,’ and ‘welfare clubs’ [6].

To stay competitive against increased globalization, e.g., cheap import of rice, policies to professionalize and scale agricultural businesses were implemented by the government through the promotion of cooperatives. While the co-ops fulfill the government’s New Institutional Economics requirements of relevance, appropriateness, durability, and fairness, cooperative farming did not meet the normed expectations of efficiency, profitability, and competitiveness, which led to some drawbacks in the plan [7].

Market power and asymmetric information appear less influential in the formation of food processing cooperatives [8].

It might be the right direction to start with fairness and then make the business a profitable one too. Agricultural cooperatives operate food processing businesses that are more transparent to the consumer, also regarding the use of chemical fertilizers, pesticides, and herbicides. People have become more sensitive to food security and request symmetric information distribution between the farmers and the buyers. This is best possible if the food producer (farm) and the food processing businesses controlled by the same owners, respectively cooperatives [8]. Organic farming and food processing have become a business model allowing for attractive premiums. The 2011 Fukushima nuclear power plant disaster was very harmful to organic farmers in the region though. Teikei consumer groups (consumers buying directly from farmers) and small cooperatives practicing “teikei” found a way to inspect radiation contamination independently to restore trust in food security [9].

Finally, it is all about solidarity between the people, which is contrary to neo-liberalism as the most extreme form of capitalism that is seeking to maximize profits through large corporations and financial institutions instead of protecting also the environment, human rights, and discriminated workers [10] (see article “Japanese Cooperatives Part 1 – Challenges“).

 

References

[1] Mizuta, D. D., & Vlachopoulou, E. I. (2017). Satoumi concept illustrated by sustainable bottom-up initiatives of Japanese Fisheries Cooperative Associations. Marine Policy, 78143-149. doi:10.1016/j.marpol.2017.01.020

[2] Klinedinst, M., & Sato, H. (1994). The Japanese Cooperative Sector. Journal Of Economic Issues (Association For Evolutionary Economics), 28(2), 509.

[3] Chesnick, D. S., & Liebrand, C. B. (2007). Global 300 list reveals world’s largest cooperatives. Rural Cooperatives, 74(1), 28-31.

[4] Marshall, B. (2006). Japan’s worker co-operative movement into the 21st century. Asia-Pacific Journal: Japan Focus, (23),

[5] Marshall, R. C. (2003). The culture of cooperation in three Japanese worker cooperatives. Economic And Industrial Democracy, 24(4), 543-572.

[6] Lord, A., & Mellor, M. (1996). Women and the cooperative provision of care: the example of the ‘Fukushi Club’ in Japan. Economic And Industrial Democracy, 17(2), 199-220.

[7] Yoshitaka, M. (2016). The Failure of Cooperative Farming Development Policies in Tōhoku, Japan. Journal Of Resources & Ecology, 7(2), 137-143. doi:10.5814/j.issn.1674-764x.2016.02.009

[8] Mikami, K., & Tanaka, S. (2008). Food processing business and agriculture cooperatives in Japan: market power and asymmetric information. Asian Economic Journal, 22(1), 83-107.

[9] Kondoh, K. (2015). The Alternative Food Movement in Japan: Challenges, Limits, and Resilience of the Teikei System. c(1), 143-153.

[10] Kitazawa, Y. (2010). Japan’s lost decades and a women-led socio-solidarity economy. Development, 53(3), 416-420. doi:10.1057/dev.2010.46

Cooperatives in Japan (Article Series): Part 1/4 – Challenges and the Necessity for Cooperatives

Overview and Conclusion article for Part 1 – Part 4, please see here.

The article presents Japan-specific details related to economic, demographic, and cultural challenges that can potentially be addressed by a more cooperative economy. Despite national peculiarities and unique cultural phenomena, the background against which the issues have to be seen should not be forgotten. When analyzing why social and environmental problems cannot be improved, one will always be led back to the observation of excesses that are caused by the capitalist economy’s ultimate fight for maximum profits. Where is the limit between acting responsible and exploiting natural resources and workers? Unfortunately, the answer is that there will never be a healthy balance resulting from a system that seeks maximization of monetary profits for a small elite above anything else.

“Japan has experienced ‘two lost decades,’ with zero or minus growth (Gross Domestic Product (GDP)) and price deflation (Consumer Price Index (CPI)).” [1, p. 416] 

minus growth and price deflation.jpg

Figure 1. Minus growth and price deflation [10]

After the burst of the economic bubble in 1991, many of the small and medium-sized enterprises have gone bankrupt, and consumers’ buying power declined. The big corporations haven’t maintained the diverse vitality and innovation of the SME’s [1], despite the continuous pressure to innovate and create new markets in Japan, especially in information and communication technology sectors [2].

The real winner of the 2014 reform package (deregulation of farmland) could be land-hungry companies with little or no interest in the future of Japanese agriculture [5]. 

land-hungry companies Japan.jpg

The political system is considered to be in need of further procedural and methodological upgrades, especially on local levels [3]. For example, there exist unresolved conflicting goals related to the aspired consolidation of farmland (respectively enlargement of farms for increased productivity) by the local actors and regarding the deregulation of farmland, which makes it accessible to corporations [4]. The essential Japanese cooperative sector for agriculture is threatened by recession, deregulation, and ease of trade barriers [5].

Japan is one of the largest importers of farm products, and its record-low food self-sufficiency contradicts the many agricultural fields that lay idle [13]. More local sourcing through cooperatives would be beneficial.

“The most important and useful alternative to resolve a deadlock of fiscal policy and social policy by the governments is to develop the social economy sector” [3, p.263]

 social economy.jpeg

“The humanization of labor also is considered as the way toward the self-realization of individuals.” [3, p. 262]

Japanese culture includes a strong sense of mutual obligation and loyalty and a collectivist way of relating to others. Even for small and usually, in Westerner contexts, independent small businesses, there exist most often some business alliances (Dana, 1998). These cultural specifics may speak for a naturalness of cooperation to Japanese individuals and organizations. On the other side, also in Japan, there are tendencies towards more individual lifestyles and the desire for improved work-life balance (Ishizuka, 2002). The former possibly a negative aspect for community building, the latter speaking for more co-operatively organized work.

“It is ironic that the countries who have fared best in industrial and economic development are now facing a crisis in personal care, particularly for the elderly.” [7, p. 199]

 elderly care

Japan’s care situation is worse than in comparably wealthy nations, for example in Europe. Governments’ positions are still referring to welfare to be provided by the family, private employers, and today increasingly also by voluntary organizations. However, the daughters who used to care for their parents are entering the corporate workforce too, and only one-third of the corporate workforce is having access to the system. Japan faces the challenge of a high need for welfare services while keeping low taxation rates. The relegation of welfare services to non-profit organizations (NPO) and cooperatives is one strategy taken [7].

The capitalist economy is increasingly using women in its drive for profits but chooses to ignore the burden of reproductive work which they carry. [7] 

pregnant-woman-work.jpg

In fact, the super-aging Japanese society has an aging rate of more than 25% (i.e., every fourth person is 65 years or older, with most extreme situations in rural farming communities [13]). Japan lacks enough doctors [8] while the hidden asset of family welfare is not available anymore as women are absorbed by their work life and corporate careers [9].

“It is deeply worrying that youth are unable to find regular jobs for decades after graduating from school. They are called the lost generation, and many call themselves freeters (‘free part-timers’), as they look for miscellaneous part-time jobs.” [1]

youth unemployment

Although criticized by neo-liberal voices, the Japanese lifetime employment has led to comparatively low unemployment rates: while for heads of households it was 3%, for the rest of the family it was more than 8%, and unemployed people are increasingly becoming more extended term cases. Long-term employment offers are decreasing while non-standard jobs are on the rise [11]. More than half of all female workers of any age were already in 2009 non-regular workers, usually cheap part-timers, which is a peculiar characteristic of the Japanese labor market [1].

Women call for more “independence” and “self-reliance” and therefore decry the discriminating Million Yen Wall that is incentivizing women staying at home. [12]

Care cooperatives such as the Fukushi Club are often the only possibility for women with elderly parents to find some work [7]. Another reason for women being forced to work part-time is the fact that few jobs are paying more than $20,000 to woman over 35. And, a tax wall set at $10,000 means that it financially doesn’t pay off to earn $20,000 because all earnings above $10,000 are going to taxes of some form. There seems to be nothing on the Equal Employment Opportunity legal horizon that is likely to change the wide salary differentials between men and women of the same age and education level [12].

“Japanese company-ism has been destroying gradually the relations among persons in the family and the community by obliging adult males to spend most of their waking hours at work.” [3]

company-ism.jpg

Company-ism on the one hand side and contract work on the other have led to decreased job satisfaction [11]. Employee participation program intended to address that problem were far from enabling more democratic working environments and are already outdated again [3]. Worker cooperatives can be an excellent answer to the call for a system that makes it easier to establish businesses responsive to the needs of citizens.

Acting on symbols like ‘help’ without their being explicitly differentiated from the work itself is a condition of smooth cooperative operation. [14]

Leadership issues have harmed cooperatives and their reputation overall. For example, there were legitimate accusations of management incompetence [3]. It is vital to manage cooperatives well and to foster full democracy in the organization [5]. If the democratic decision and economic participation right is seen as a common good that cannot be taken away, for example, even not in case of fluctuating performance, there the behavioral problem of free-riding arises. Therefore, proper management of cooperatives includes leadership using symbols such as ‘help’ instead of monitoring methods that are often rejected by the employees, and which is building the moral community with perpetuating pro-social values enabling cooperation [14].

 

References

[1] Kitazawa, Y. (2010). Japan’s lost decades and a women-led socio-solidarity economy. Development, 53(3), 416-420. doi:10.1057/dev.2010.46

[2] Knowledge-based view of corporate strategy. (2007). Strategic Direction, (5), doi:10.1108/sd.2007.05623ead.003

[3] Ishizuka, H. (2002). The Social Economy Sector in Japan. Annals Of Public & Cooperative Economics, 73(2), 241.

[4] Jentzsch, H. (2017). Abandoned land, corporate farming, and farmland banks: a local perspective on the process of deregulating and redistributing farmland in Japan. Contemporary Japan – Journal Of The German Institute For Japanese Studies, Tokyo, 29(1), 31-46. doi:10.1080/18692729.2017.1256977

[5] Klinedinst, M., & Sato, H. (1994). The Japanese Cooperative Sector. Journal Of Economic Issues (Association For Evolutionary Economics), 28(2), 509.

[6] Dana, L. P. (1998). Small but Not Independent: SMEs in Japan. Journal Of Small Business Management, 36(4), 73-76.

[7] Lord, A., & Mellor, M. (1996). Women and the cooperative provision of care: the example of the ‘Fukushi Club’ in Japan. Economic And Industrial Democracy, 17(2), 199-220.

[8] Iguchi, S., Niwayama, M., & Takahashi, H. E. (2015). A conference report of the interprofessional satellite symposium in Uonuma, Japan: an international exchange on the future of community care. Journal Of Interprofessional Care, 29(3), 284-287. doi:10.3109/13561820.2014.966541

[9] Kurimoto, A. )., & Kumakura, Y. ). (2016). Emergence and evolution of co-operatives for elderly care in Japan. International Review Of Sociology, 26(1), 48-68. doi:10.1080/03906701.2016.1148341

[10] Market Monetarist. (2017). The scary difference between the GDP deflator and CPI – the case of Japan. Retrieved from https://marketmonetarist.com/2012/11/06/the-scary-difference-between-the-gdp-deflator-and-cpi-the-case-of-japan/

[11] Nogawa, S. (2012). The Great East Japan Earthquake and a Future Vision for Labor Law in Japan. Japan Labor Review, 9(4), 105-123.

[12] Marshall, B. (2006). Japan’s worker co-operative movement into the 21st century. Asia-Pacific Journal: Japan Focus, (23),

[13] Kimura, A. H., & Nishiyama, M. (2008). The Chisan-Chisho Movement: Japanese Local Food Movement and Its Challenges. Agriculture And Human Values, 25(1), 49-64. doi:http://dx.doi.org.liverpool.idm.oclc.org/10.1007/s10460-007-9077-x

[14] Marshall, R. C. (2003). The culture of cooperation in three Japanese worker cooperatives. Economic And Industrial Democracy, 24(4), 543-572.

Cooperatives in Japan (Article Series): Overview

coop.jpg

English articles about different types and industry sectors of cooperative organizations in Japan remain somewhat limited and represent scattered knowledge that would benefit from interlinkage. The series of articles in hand that I have published to the Platform Cooperativism Japan (PCJ) Consortium builds on a literature review that has proven useful in contributing to the creation of a holistic contemporary picture of the cooperative landscape in Japan.

Japan is known for its cooperative tradition. Indeed, roughly one-third of Japanese households belong to co-op’s [1]. The articles in this series aim to distill the lessons learned from this success, but also to identify further potential to grow the historically relatively very small market share of cooperative enterprises. The article series comprises of 4 parts that are logically sequenced, and each is covering one of the following topics:

The articles always put the situation of the Japanese co-ops back into the broader context. Cooperatives are part of the social economy (if that should be a meaningful definition at all) and overall market and society in large. Especially worker cooperatives provide for a fairer system through democratic values at the workplace, and it is essential to look for ways how to increase the influence on not only the social agenda but also on the progress of a State and economic future that cares for all [2].

Conclusions

After the study of cooperative examples in Japan in the context of identifying success factors for promoting the co-operative organizational form for a fairer future of work, the following points seem important to keep in mind for future efforts to advance the cooperative and social economy overall:

  • Worker co-operatives need to get a clear and supportive legal basis in Japan, and themselves need to develop strategies to gain influence on the social agenda [5].
  • I think it should be more clearly distinguished when using the term co-operative, as in cases of so-called big Japanese co-ops that do not grant member’s a voice in the leadership of the organization. One member one vote is, however, the most vital element of cooperative governance as only ownership and decision rights are effectively empowering the contributing citizen members.
  • Although the young people are primarily affected by the challenging labor market, they don’t seem to be connected to the worker cooperative movement. Some few examples constitute JWCU worker groups consisting of primarily young people [4]. For co-operatives to be successful, they need to be able to speak to the youth not only as volunteering organization but as a competitive better alternative to the neo-liberal capitalist economy.
  • Increasing the awareness about co-operatives should be a priority as often the young people just don’t know about its possibilities [4].
  • Millennials may appreciate opportunities for work-life balance. Co-operatives might be able to provide such a balance in addition to purpose and identification. Furthermore, co-operative governance can be designed to reward performance, therefore supporting personal growth in any ways.
  • Solidarity between older and younger generation should also enable financing of co-operative start-ups of young people by the member funding of older more affluent people. Social impact investment should account for such opportunities.
  • While grass-roots efforts are essential, the co-operative way should also be supported top-down as a political priority. A co-operative economy can not only be profitable but by not passing excess profits to just a few it is also able to provide for welfare benefits and community development where often tax paid government efforts failed in demonstrating sufficiently sustainable effects.
  • All the co-operative seeds should be honored, but it has to be stated that the co-operative economy is negligible and toothless compared to the overall economy. There is no reason for the co-operative movement to rest on its laurels.
  • Implementing democracy in organizations by giving the member-owners (and employees) a voice and a share are just natural. Therefore, the co-operative way, rather than being an extreme alternative movement, has the potential to be common sense across many political directions.
  • Inter-cooperative cooperation is crucial to bundle the efforts for maximum effect on the growth of the movement. While modest scale for NPOs in welfare services and the solidarity economy is a positive feature, big-scale commercial markets have to be given back from shareholder exploitation to the citizens. Any business can be organized co-operatively.

 

References

[1] David, D. (2012). Toward Contemporary Co-operative Studies: Perspectives from Japan’s Consumer Co-ops. Canadian Journal Of Nonprofit And Social Economy Research, Vol 3, Iss 2, Pp 104-105 (2012), (2), 104.

[2] Ishizuka, H. (2002). The Social Economy Sector in Japan. Annals Of Public & Cooperative Economics, 73(2), 241.

The People’s Disruption: Platform Co-ops for Global Challenges (November 10-11, 2017 / The New School, New York City)

 

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The People’s Disruption: Platform Co-ops for Global Challenges

November 10-11, 2017 / The New School, New York City

The first platform cooperativism event in 2015 popularized the #platformcoop concept, and the conference a year later brought together co-op and union leaders to push the model forward. This third event will zero in on ways that platform cooperatives can help to address some of the future’s most urgent challenges. The fairer digital economy we need is already emerging, but it won’t happen on its own. That’s where you come in.

  • Learn about new platform co-op projects that are shaping this emerging ecosystem, from blockchain-based financing to user-owned clouds
  • Reflect on research about platform co-op experiments in recent years
  • Confront growing challenges from artificial intelligence to global governance
  • Join leaders from co-ops, industry, labor, and social movements—from Associated Press to Black Lives Matter—to raise the scale of our ambition

Platform cooperatives are poised to be a dynamic, transformative force in building a more equitable economy for people across various income, race and class strata, starting with the most vulnerable populations. This is a political and economic movement that can disrupt Silicon Valley’s disruptors by shifting the focus toward fundamentally fairer forms of ownership and governance. Over the past few years, the burgeoning of platform co-ops, community currencies, worker’s tech, the solidarity economy, and B Corps have shown us that alternative economies are not only necessary but possible. Come help us make platform cooperativism part of the new normal.

Convened by

Trebor Scholz, Camille Kerr, Nathan Schneider, Palak Shah
Featuring

Alicia Garza / Felicia Wong / Brad Burnham / danah boyd / Joseph Blasi / Pia Mancini / Yochai Benkler / Juliet Schor

And many more: platform.coop/2017/participants

Sponsored by

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Also, don’t miss:
Platform Coop 2017: Technology Afterparty

(November 12, New York, NY)

An after-party for #platformcoop-obsessed tech developers and platform designers to come together and learn from one-another, connect, and co-create.
Register here —it’s free.
DazzleCon ’17

(November 15-17, Portland, OR)

Still accepting applications! If you’re a post-revenue founder interested in learning more about creating a more inclusive and ethical type of funding, be sure to visit www.zebrasunite.com.

More Information and Apply
Tenerife Colaborativa 2017

(November 23-27, Tenerife, Spain)

An opportunity to discover the keys that encourage economic paradigm shift and to explore initiatives that lead to practice.

More information and Registration

7 WRONG Reasons/Excuses for Why We Cannot Change for a Better Cooperative Economic System

1 – We shouldn’t complain about capitalism, if we use it

I heard this mean argument recently. Did we choose to be born into that system? That’s like telling the unfortunate living in smog; they shouldn’t complain about the polluted air if they breathe it.

breathing capitalism

2 – Communism isn’t better than capitalism

Did I say anything about communism? I’m talking about Cooperativism. Co-ops can be for profit. The same business models as today can be run democratically. The only difference would be that profits are not exclusively going to a handful of investors valuing short term profits over long-term employment, but would be re-invested into the company and its people who create the value of the organizations with their daily work. Aren’t many of today’s corporations branding themselves as being cooperating, socially responsible, caring for the community? Why then don’t we get a share and vote then? Because that would be the true meaning of community.

cooperatiism as alternative

3 – We cannot treat people equal

Yes, and no. Again, I am not talking about a system without performance-based incentives. We all learn in sports how to be fair losers.

Value creation has to be re-defined. Today, helping rich people avoid taxes is rewarded generously while cleaning up a the dirty environment, caring about weak and sick people, and helping a hungry child has to be done largely as unpaid volunteering.

Humans are relatively equal; there is no reason to make racial differences. The differences that matter are made by external circumstances, such as education, support, and fair treatment. Different talents and ambitions are fine though. Co-op members can democratically determine what efforts are incentivized in what way.

similar and different

4 – Governance by the people ends in chaos

Like in a state democracy with millions of citizens too, a cooperative membership for efficiency reasons can vote for major decisions only, and elects a representation for managing the enterprise. The good thing is, the management would act on behalf of the members (workers, consumers, producers, etc. who are actively involved and interested in the organization in the long-term) rather than on behalf of profit-maximizing outside shareholders.

your vote is your voice

5 – Cooperative decisions are too slow

Of course, a dictatorship may provide for faster decisions. Have you already campaigned dictatorship? Who would you currently choose? Ah, sorry, we don’t have a saying in that.

Feasibly administering elections and voting is possible. As a Swiss, I know what I’m talking about.

democracy or dictatorship

6 – People don’t want to engage

With a balance between responsibilities, accountabilities, and competencies (!) people are willing to assume all of these. Also, a cooperative would educate for active citizenship rather than investing into advertising and luring people into passive consumerism. Cooperative values motivate to engage for individual and collective well-being.

consumerism

7 – We cannot change it

A couple of dozens of people own the wealth of half of the world population. 1% percent own the same wealth as the rest 99%. The net worth of the world’s billionaires increased from less than $1 trillion in 2000 to over $7 trillion in 2015, so the gap between rich and poor is growing up dramatically.

The rich are worried more and more as their oligarchic power increase becomes more obvious to more people. It looks like they think only a global war will hinder the awakening of the masses and defend their illegitimate privileges.

The current world order is keeping the majority of people poor and uninformed enough, or happy enough so that they don’t take action. War will serve the same end.

We can change it, if we spread the word for workplace democracy and support the cooperative movement. The five firms worth most and extracting most value/profit are all IT/Internet businesses (Google, Amazon, Apple, Facebook, Microsoft). Maybe it’s not too late to claim back in minimum the virtual world with its increasing real effects on our daily life and the future of our children. (Please see https://www.mathias-sager.com/category/growth-enablement/initiatives/products/)

keep out

After World War III

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Pursuit of wealth and power > World War III > Peoples’ recovery and counter movements > Ineffectiveness of old distraction strategies > World citizenship > Manifestation of the next human evolutionary step

Continue reading After World War III