Democratising Co-operatives, Charities and Social Enterprises
Submitting InstitutionSheffield Hallam University
Unit of AssessmentBusiness and Management Studies
Summary Impact TypeSocietal
Research Subject Area(s)
Studies In Human Society: Policy and Administration
Law and Legal Studies: Law
Summary of the impact
This case study describes the impact of research undertaken within
Business and Management on the ownership, governance and management of
co-operatives, charities and social enterprises. It describes how
developing the concept of communitarian pluralism led to changes
in the management and teaching of social enterprise locally, nationally
and internationally. We show the impact on professionals, and lecturers
and students in other HEIs. We provide evidence that impact activities
changed the way organisations and consultancy bodies conceptualise social
enterprise, and how this catalysed the formation of an association to
advance communitarian pluralist design principles.
Following recent financial crises, the concept of social economy
(economic activity through networks of democratically controlled
co-operatives, associations and social enterprises) has become a strategy
for public/private sector reform. The EU's Social Business Initiative
adopted 11 actions to enhance the social economy by 2020. The United
Nations "2012 International Year of Co-operatives" supported the goal of
reducing global poverty. Studies of governance by Ridley-Duff (appointed
Senior Lecturer 2007-present) and Coule (Appointed Senior Lecturer 2007-
present) engage directly with this area of policy development. They have
developed six peer- reviewed outputs from this research.
Programme of research: Ridley-Duff developed a programme of
research through a conceptual paper (3.1) which was followed by a series
of action research projects (2008 - 2012) that have cumulatively developed
knowledge on communitarian governance. These produced findings on
multi-stakeholder ownership, governance and management in social
enterprises (reference 3.4, 3.5). Coule's research programme (2008 - 2010)
used focus groups, surveys and follow up case studies to obtain findings
on strategies for sustainability in the charity sector (reference 3.3,
Conceptualisation: The underpinning conceptualisation of this
research is that a relationship orientation is fundamental to
communitarian philosophy: each person's individuality and agency is seen
as a by-product of their community relationships. The concepts of social
rationality and economic rationality are used to differentiate behaviours
that enhance community relationships from those that advance corporate
goals (reference 3.1). Where communitarian philosophy is combined with
strategies to pluralise ownership, governance and management, the result
is a set of communitarian pluralist design principles. This takes the form
of multi-stakeholder ownership, recognition of interests and systems to
promote solidarity between stakeholders (reference 3.2).
Major Findings: Ridley-Duff published evidence in 2012 (reference
3.4, 3.5) that multi-stakeholder approaches to ownership, governance and
management influence the design and development of co-operative social
enterprises. The argument that designing organisations to be socially
inclusive increases resilience and social impact is supported by Coule's
research outputs (reference 3.3, 3.6) that crises in charities were more
likely to occur when a close Chair-CEO relationship excludes stakeholders
from board-executive communication.
Ridley-Duff developed insights on how communitarian pluralist design
principles influence practice. Through systematic identifying of the
management choices that lead to inclusive ownership, governance and
management (reference 3.1), Ridley-Duff developed case studies of model
Articles of Association that create `socialised enterprises' where
different classes of share are offered to social entrepreneurs, employees,
users and investors (reference 3.4). If capital restructuring is combined
with social auditing, the result is a `socialised enterprise' that can be
distinguished from a `social purpose enterprise' guided by unitary design
principles, a preference for executive control with restricted membership
and ownership rights (reference 3.5).
Coule's first output (reference 3.3) presents strategy making as a
social, dynamic process. She considers the implications of prevailing
unitary and pluralist approaches for such processes to provide insights
into bridging the divide between internal stakeholder groupings in
decision-making. Her second output (reference 3.6) offers insights into
how different governance theories shed light on the prioritization and
marginalization of accountability to internal and external stakeholders.
Specifically, the paper delineates the implications of agency,
stewardship, democratic and stakeholder theory and their links to specific
forms and processes of accountability. Coule's final paper (reference 3.6)
links theories of governance to the cumulative findings of both authors'
work on governance in co-operatives, charities and social enterprises.
References to the research
3.1 Ridley-Duff, R. J. (2008) "Social enterprise as a socially rational
business", International Journal of Entrepreneurial Behaviour and
Research, 14(5), 291-312. Journal ABS 2* in 2013). From 2012,
adopted as the official journal of the ISBE Research Conference. DOI
3.2 Ridley-Duff, R. J. (2010) "Communitarian governance in social
enterprises: case evidence from the Mondragon Cooperative Corporation and
Social Trends Ltd." Social Enterprise Journal 6(2) 125-145 DOI:
10.1108/17508611011069266 (Assessed as 2*/3* by independent assessors.
3.3 Chadwick-Coule, T. M. (2011) "Social Dynamics and the Strategy
Process: Bridging or Creating a Divide between Trustees and Staff", Non-Profit
and Voluntary Sector Quarterly, 40(1): 33-56. DOI:
10.1177/0899764009354646 (ABS 3* in 2013).
3.4 Ridley-Duff, R. J. (2012) "New Frontiers in Democratic
Self-Management", in McDonnell, D. and Macknight, E. (Eds.) The
Co-operative Model in Practice: International Perspectives, Glasgow:
Co-operative Education Trust, pp. 99-117. URI: http://hdl.handle.net/2164/2780
(Peer-reviewed contribution to an ESRC Funded KTP involving Aberdeen
University and the Co-operative Education Trust Scotland).
3.5 Ridley-Duff, R. J. and Southcombe, C. (2012) "The Social Enterprise
Mark: a critical review of its conceptual dimensions", Social
Enterprise Journal, 8(3), 178-200. DOI: 10.1108/17508611211280746
(Winner of 'Best Research and Knowledge Exchange Paper' at the 34th
Institute of Small Business and Entrepreneurship Awards in 2011).
3.6 Coule, T. M. (2013) "Governance in non-profit organisations:
accountability for compliance or legitimacy?" paper to BAM Conference,
Liverpool, 10-12th September. (In final stages of peer-review
for Non-Profit and Voluntary Sector Quarterly, (ABS 3* in 2013).
Details of the impact
Between 2008 and 2013, Ridley-Duff and Coule developed an impact strategy
using knowledge exchange projects, teaching support and dissemination
activities that contributed to professional development.
Impact 1 - Catalysing Insights in Social Enterprises:
Voluntary Action Rotherham (VAR), a lead voluntary organisation in
Rotherham, Yorkshire was an organisation that participated in a SHU funded
knowledge exchange project ('Bridging the Divide: A Corporate Governance
Pilot Project" (Mar - July 2008)). VAR trustees used governance
diagnostic tools created by Ridley-Duff and Coule to reach a view that
their governance practices were pluralist with a stakeholder orientation.
In contrast, VAR executives used the same tools to form a view
that their organisation's governance was unitary with a managerialist
orientation. A dialogue was established between trustees and executives
and "within one week, the CEO of the partner organisation requested
[internal] follow up actions related to...board maintenance and
development, board/staff communications, and involving members in
governance" (source 5.1).
Viewpoint Research CIC was one of five social firms who used the same
governance diagnostics during a Business Link Innovation project
("Workforce Participation" (Reference IV-18-18 June-July 2009)) (source
5.2, 5.3). Viewpoint (which has 15 staff in Leeds, Sheffield and
Doncaster) enhances the employability skills of people disadvantaged in
the labour market. As the MD of Viewpoint explained:
To actually have discussion - not just around the difference between
entrepreneurial and managerial [governance], but also democratic and
co-operative structures and ways of making decisions - it changed my
view [and] led directly to the workforce participation project [...].
There was a tangible outcome [...] that led to the development of a
staff council which is the vehicle by which staff now have a say and
influence in the running of the company. (source 5.2)
In September 2012, a case study of the follow up workforce participation
project (Sept 2010 - Feb 2011) and its impact on Viewpoint was presented
to the UK Society for Co-op Studies (source 5.3).
Impact 2 - Embedding Insights in other HEIs' Curricula:
Ridley-Duff's and Coule's findings profoundly influenced the writing of Understanding
Social Enterprise: Theory and Practice (Ridley- Duff and Bull, 2011,
Sage Publications). They contributed case studies based on their research,
their governance diagnostics and numerous learning materials to the book's
companion website (source 5.4). By 2013, there were 1791 sales from Sage's
UK office (of which over 200 went to the `Far East'), 217 from its US
office and 47 from its India office. There have been adoptions for 14 UG
and 12 PG courses in the UK, Ireland, Austria, Germany, France, Greece and
Switzerland. It is the core text for nine, recommended for 11 and
supplementary for six (source 5.4).
Impact 3 - Embedding insights and impacts through knowledge exchange
The governance diagnostics and case studies underpin the workshops on day
2 of the "Co- operative and Social Enterprise Summer School" (run annually
since July 2010). These summer schools are organized by SHU in
collaboration with Social Enterprise Europe, Social Enterprise Yorkshire
& Humber, Co-ops Yorkshire & Humber and Co-op Business
Consultants. The workshops attract co-operative and social entrepreneurs,
British Council workers participating in a Skills for Social
Entrepreneurship Programme, HEI support staff and lecturers
embedding social entrepreneurship programmes in HEIs in the UK, Asia and
Africa. Ninety-six people have attended the school. Impact 3 evidences the
link between research outputs, learning activities at the summer school,
and changes in professional practice.
One impact of the summer school is demonstrated through activities by
members of Social Enterprise Europe (SEE) which is an international
network of social enterprise educators who attended (and later
co-delivered) the summer schools. After the 2011 summer school, SEE's
consultants redefined social enterprises as organisations that "are
governed, owned and managed as democratic socialised enterprises".
As the MD explains:
"Directly after the discussions we had about socialisation and
stakeholders, we changed our slides to include 'socialisation' [...] The
definition we put forward prompted emails from Indonesia
and Malaysia saying `this will be our definition of social enterprise
from now on'...we [also] got emails from Vietnam and Korea where they
said they [...] would use it as their standard." (source 5.5)
Reach was increased after a blog on Social Enterprise Yorkshire &
Humber's website was reproduced on the Guardian Social Enterprise Network
in August 2011 (source 5.6). This attracted the CEO of the Social
Enterprise Mark Company to the International Social Innovation Research
Conference in London (Sep 2011). Her debate there with Ridley-Duff
triggered further blogs and public debate (5.7). Reach also grew after
Ridley-Duff's visit to Indonesia in 2012 (brokered by Social Enterprise
Europe / British Council). Impact is evidenced by a British Council
project worker using Ridley-Duff's materials to explain `socialised
enterprises' to local entrepreneurs (source 5.7).
Three summer school participants drew directly on case studies in
Ridley-Duff's work (reference 3.3) to create the FairShares Model
(source 5.8). This not only creates a set of brand principles to
facilitate the auditing of communitarian pluralist design principles, but
also advances new model Articles of Association to embed these principles
in social enterprise start-ups and conversions. The FairShares Model
integrates multiple-stakeholders by offering: Founder Shares to
entrepreneurs; User Shares to customers; Labour Shares to
employees; and Investor Shares to represent the capital created by
In March 2013, five management consultancies backed the creation of the FairShares
Association to support the use of the FairShares Model in
their work (source 5.8). This has attracted a further 34 educators and
consultant members who now contribute to a FairShares Wiki (source
5.9). The FairShares Association LinkedIn Group had 216 members (as at
Social Enterprise Europe's MD, a co-founder of the association, explains
how it has changed their work with enterprise educators in the UK and
overseas (source 5.5):
"We are writing a step by step guide for teachers to set up a
FairShares Company in schools... [British Council contacts] in South
East Asia...are much more comfortable with the politics of it than we
are....[We organize placements for] the very prestigious Hong Kong
Business School [and] are meeting one later this month who has graduated
and is now a practising lawyer who wants to talk to us about the
Sources to corroborate the impact
5.1 Voluntary Action Rotherham. Final Project Report: Governance Pilot
Report. 18th July 2008. Report can be provided by the
University on request.
5.2 Interview with the MD of Viewpoint Research, 25th May
2013. See also Case 8.2 in Understanding Social Enterprise (5.4) (http://www.sagepub.co.uk/ridleyduff).
5.3 A conference paper written with Viewpoint's MD describes the second
Business Link project: Ridley-Duff, R. J. & Ponton, A. (2012)
"Workforce Participation: developing a theoretical framework for
longitudinal study", paper to UK Society for Co-operative Studies
Conference, Lincoln, 2nd Sept 2nd, http://shura.shu.ac.uk/id/eprint/6551.
Following revisions, this paper has now been accepted for publication in
the Journal of Co-operative Studies.
5.4 Sage Publications - publisher's record of adoptions (8/10/12),
royalty statement (31/03/13) for Ridley-Duff, R. J. and Bull, M. (Eds.), Understanding
Social Enterprise: Theory and Practice, London: Sage Publications.
Documentation can be provided by the University on request.
5.5 Interview with the MD of Social Enterprise Europe, 6th
June 2013. See also http://www.socialenterpriseeurope.co.uk/pages/what-is-social-enterprise/.
5.6 Discussions on the Guardian Social Enterprise Network took
place at http://socialenterprise.guardian.co.uk/social-enterprise-network/2011/sep/01/social-enterprise-mark-cooperatives.
The ISIRC conference is reported at http://beanbagsandbullsh1t.com/2011/09/15/lack-of-co-operation/
(15th Sept 2011)
5.7 A British Council worker reports `socialisation' to Indonesia's
social entrepreneurs: http://socentindo.wordpress.com/2012/05/17/cooperatives-socialised-enterprises/.
Evidence of embedding materials in slides for INSEAD (an Indonesian Social
Enterprise network) is also available on request.
5.8 See http://www.fairshares-association.com/blog.html
for evidence of the launch, practitioner engagement, and the formation of
the first FairShares Company.
5.9 The FairShares Model (www.fairshares.wikispot.org/background).
The interview with the MD of Social Enterprise Europe (SEE) attests to its
influence in the UK and overseas (see. 5.5)