[This post is intended to follow my Reader Response Post 3: Multi-Stakeholder Socio-Technical Enterprises]

In her report for the Young Foundation, Humanity at Work, Mary Hodgson (2017) looks closely at the Mondragon Cooperative as a “social innovation ecosystem” case study. The largest cooperative in the world, Mondragon is actually a federation of 96 separate, self-governing cooperatives, with more than 81,000 people, 14 Research and Development Centers, and its own university. It is the leading business group in Spain’s Basque Country and the tenth largest in all of Spain, with annual revenues of over €12 billion[1]. Social values are embedded in its core working practices, with salary ratios between the lowest and highest paid workers of 1:9, and multiple training, governance, and placement opportunities for workers. Lund’s research revealed a thriving “ecosystem” where individual cooperatives cooperate with each other in mutually beneficial and often complementary ways, supported by “enabling institutions” such as its university and credit union, and now platform cooperatives.

Mondragon and its cooperative ecosystem are part of a growing global “Social and Solidarity Economy” (SSE). Though there is no one definitive definition, the International Labour Organization (ILO, 2021) defines the SSE as consisting of “enterprises and organizations, in particular cooperatives, mutual benefit societies, associations, foundations and social enterprises, which have the specific feature of producing goods, services and knowledge while pursuing both economic and social aims and fostering solidarity”. ILO’s 2019 Declaration for the Future of Work (ILO, 2019) indicated that it should concentrate its effort in (emphasis added):

Supporting the role of the private sector as a principal source of economic growth and job creation by promoting an enabling environment for entrepreneurship and sustainable enterprises, in particular micro, small and medium-sized enterprises, as well as cooperatives and the social and solidarity economy, in order to generate decent work, productive employment and improved living standards for all.

More recently, the European Union has been actively investigating and promoting its “social and solidarity ecosystems” in a variety of ways. Drawing on the findings from 35 national reports, a 2020 EU commissioned comparative synthesis report (Borzaga, et al., 2020) provides an overview of the social enterprise landscape in Europe. This work was conducted in association with the European Research Institute on Cooperative and Social Enterprises (Euricse), whose mission is “to promote knowledge development and innovation for the field of cooperatives, social enterprises and other nonprofit organizations engaged in the production of goods and services”; and the Research Network for Social Enterprise (EMES), “established to build up an international corpus of theoretical and empirical knowledge, pluralistic in disciplines and methodologies, around our ‘SE’ concepts: social enterprise, social entrepreneurship, social economy, solidarity economy and social innovation.” In 2020, the Organisation for Economic Co-operation and Development (OECD) launched the Global Action “Promoting Social and Solidarity Economy Ecosystems” (OECD, 2021), funded by the European Union’s Foreign Partnership Instrument. It covers over 30 countries, including all EU countries and others such as Brazil, Canada, India, Korea, Mexico and the United States.

Paralleling these efforts, in a Harvard Business Review article, Heerad Sabeti (2011), CEO of the Fourth Sector Group (FSG), lays out the context and rationale for promoting the development of what he calls a more “supportive ecosystem” for social entrepreneurs operating “for-benefit” enterprises, those that may generate earned income but also prioritize explicit social missions. Sabeti argues that because these hybrid type “fourth sector” enterprises defy classification as pure business or nonprofit, the support systems developed for other sectors are often less than ideal, and even inhibitory. He proposes “an ecosystem of support—including financial markets, accounting standards, and professional services”, which develop around them. Since that time, he and FSG have been actively promoting efforts related to this, including those specifically related to a COVID pandemic “build back better” response. FSG is involved in convening and facilitating several regional initiatives advancing this work, including those participating in its Fourth Sector Mapping Initiative, “a global, multi-stakeholder collaborative effort to shed light on the emerging fourth sector of the economy.” FSMI activities include the creation of an open, freely accessible, interactive online database of for-benefit organizations and fourth sector support organizations.

In their 2021 case study, Julia Martins Rodrigues and Nathan Schneider look at what they believe to be a new (or at least newly recognized) type of multi-stakeholder business association, the “multi-stakeholder network”, which might be nurtured within and constitute such supportive ecosystems. While not formally linked together, the distinct yet interlocking cooperative enterprises part of what they refer to as the Namaste Network have organically emerged from or in association with the Colorado solar energy industry over several years. They include Namasté Solar (a worker co-op), Amicus Solar (a purchasing co- op), Amicus O&M (a shared-services co-op), Clean Energy Credit Union (a consumer-owned financial institution), and Kachuwa Impact Fund (a co-op of investors). Shared values related to economic democracy (in terms of shared ownership and governance), and International Cooperative Alliance Principle 6 (“cooperation among cooperatives”) and 7 (“concern for community”) are suggested as reasons for the success of this network thus far. This has allowed the network as whole to serve and connect a diverse set of stakeholders in complementary ways, while each business retains its autonomy and focus on the unique role it plays.

Though perhaps not intentional, the form the Namaste Network has evolved into also seems to correspond well with some of the “core design principles” Nobel laureate Elinor Ostrom originally identified as contributing to the effectiveness of groups managing shared resources as a commons (e.g., polycentric governance), which she further generalized in collaboration with David Sloan Wilson and Michael Cox (2013). Wilson and others (e.g., Wilson et al., 2020) have since gone on to apply Ostrom’s insights and those from the fields of evolutionary and cognitive behavioral science through the facilitative practice of “Prosocial”. This capacity building approach may prove useful in cultivating greater cooperation and mutual aid among more diverse groups and contexts.

Building on the foundational, well established mechanisms of evolution—variation, selection and replication, a concept and process central to Prosocial is “multi-level selection” (MLS). In practice this means instituting methods (including incentives and penalties) limiting the ability of individual and sub-group self-interests to supersede those of the larger group, while conversely aligning individual interests and actions in support of collective well-being. One rationale for this “managed evolution” process is that groups whose members cooperate with each other are ultimately able to outcompete those whose members compete with each other. This is concisely conveyed through a frequently cited maxim D.S. and E.O. Wilson (unrelated) shared in a 2007 publication they co-authored:

Selfishness beats altruism within groups. Altruistic groups beat selfish groups. Everything else is commentary.

Supportive ecosystems and capacity building approaches like Prosocial can help realize the kind of “integrative scaling” Utting (2015) and others suggest as a necessary but complex design element of a Social and Solidarity Economy, a balancing act which Martins Rodrigues and Schneider suggest the Namaste Network exhibits. The multi-stakeholder network also represents a development form compatible with Jessica Gordon-Nembhard’s more expansive vision of a Cooperative Commonwealth (2020), and Gar Alperovitz’s Pluralist Commonwealth (2017).

References

(Titles hyperlink to respective citation entry for this group library)

Alperovitz, G. (2017, June 28). Principles of a Pluralist Commonwealth. TheNextSystem.Org. https://thenextsystem.org/principles

Borzaga, C., Galera, G., Franchini, B., Chiomento, S., Nogales, R., & Carini, C. (2020). Social Enterprises and Their Ecosystems in Europe—Comparative Synthesis Report. European Commission. Retrieved from https://ec.europa.eu/social/main.jsp?catId=738&langId=en&pubId=8274

Hodgson, M. (2017). Humanity at Work—MONDRAGON, a social innovation ecosystem case study. London: The Young Foundation. Retrieved from https://www.youngfoundation.org/publications/humanity-work-mondragon-social-innovation-ecosystem-case-study/

International Labour Organization (ILO). (2019). ILO Centenary Declaration for the Future of Work, 2019. Retrieved from International Labour Organization (ILO): https://www.ilo.org/global/about-the-ilo/mission-and-objectives/centenary-declaration/lang--en/index.htm

International Labour Organization (ILO). (2021). Social and Solidarity Economy. Retrieved from International Labour Organization (ILO): https://www.ilo.org/global/topics/cooperatives/projects/WCMS_546299/lang--en/index.htm

Martins Rodrigues, J., & Schneider, N. (2021). Scaling Co-operatives Through a Multi-stakeholder Network: A Case Study in the Colorado Solar Energy Industry. https://osf.io/vg4xm/?view_only=9d01c9be764c4f26a52da9de925f5005

Nembhard, J. G. (2020). Building a Cooperative Solidarity Commonwealth. In J. G. Speth & K. Courrier (Eds.), The New Systems Reader (1st ed., pp. 273–284). Routledge. https://doi.org/10.4324/9780367313401-23

Organisation for Economic Co-operation and Development (OECD). (2021). Global Action to promote Social and Solidarity Economy Ecosystems. Retrieved from Organisation for Economic Co-Operation and Development (OECD): https://www.oecd.org/cfe/leed/fpi-action.htm

Sabeti, H. (2011, November 1). The For-Benefit Enterprise. Harvard Business Review. Retrieved from https://hbr.org/2011/11/the-for-benefit-enterprise

Utting, P. (Ed.). (2015). Social and solidarity economy: Beyond the fringe. Zed Books. https://www.bloomsbury.com/us/social-and-solidarity-economy-9781783603442/

Wilson, D. S., & Wilson, E. O. (2007). Rethinking the Theoretical Foundation of Sociobiology. The Quarterly Review of Biology, 82(4), 327–348. https://doi.org/10.1086/522809

Wilson, D. S., Ostrom, E., & Cox, M. E. (2013). Generalizing the core design principles for the efficacy of groups. Journal of Economic Behavior & Organization, 90, S21–S32. https://doi.org/10.1016/j.jebo.2012.12.010.

Wilson, D. S., Philip, M. M., MacDonald, I. F., Atkins, P. W. B., & Kniffin, K. M. (2020). Core design principles for nurturing organization-level selection. Scientific Reports, 10(1), 13989. https://doi.org/10.1038/s41598-020-70632-8

[1] https://www.mondragon-corporation.com/en/about-us/

>My next Reader Response Post 5: New York State Contexts