OVER the past 20 years there has been a lot of academic activity which has contributed theoretical and empirical literature to organisational effectiveness and efficiency.
Ranging from the King Report on Corporate Governance to the Bank of International Settlements (BIS)’s document entitled Enhancing corporate governance for banking organisations, the world has witnessed a great spike in literature which argues for good corporate governance as a panacea for organisational mal-governance and inefficiency.
The ongoing academic and practitioner discourse on corporate governance issues has shed light on problems that cut across diverse organisations. Nevertheless, over-concentration on corporate governance has led to less time and resources being devoted to the study of a similar concept called co-operative governance.
The major premise of corporate governance discourse is that organisations can be modelled into corporate entities which can then be studied in terms of the power, reward and punishment relationships and dynamics that exist to foster organisational continuity, effectiveness and influence in society.
One thing is certain and it is that despite volumes of literature that have been produced ostensibly unpacking corporate governance problems that afflict organisations and suggesting solutions, many organisations continue to be plagued by the age-old problem of corruption, coupled with its close cousins of inefficiency, nepotism, centralisation of power, selfishness and lack of regard for other people’s talents and diversity of skills.
It is the belief of this article that much of the studies in corporate governance need to be undergirded by a thorough study of the concept of co-operative governance.
M Karthikeyan (2009) defines co-operative governance as a pure democratic self-governance system of managing a co-operative entity based on and in complying with the principles, values and philosophy of co-operation through the appropriate and effective organisational structure with conducive culture and ethical climate, organisational machinery that includes management and administrative professionals at various levels/ layers of functioning within the parameters of legal of provisions and policy framework of the government, keeping in view the prevailing socioeconomic environment to change the administrative culture, management and control systems, and the mind-set and work culture of the members and work force of co-operative enterprises.
This comprehensive definition captures the four main pillars of co-operative governance which are teaming/teamwork/working together, democracy, strategic leadership and accountable or responsible empowerment.
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One may argue that co-operative governance is a specialised form of corporate governance since co-operatives (whether business or social ones) can be regarded as corporate entities of one sort or another.
A in depth study of co-operative governance principles may afford organisation and management scholars with a lot of insights about dynamics which are essential to organisational effectiveness and stable power and resources structures.
In many African and Asian societies, versions of the ubuntu (Nguni), hunhu (Shona) or harambee (Swahili) philosophy as opposed to the prevalently Western philosophies of individualism and self-centredness have been observed to create strong societal institutions and ensuring sustainable development through ethical reciprocity, oneness and interdependence.
Teaming or teamwork A good case study of participatory governance or teamwork in co-operative systems is that of the Grameen Bank. The bank is a Nobel Peace Prize-winning microfinance organisation and community development bank founded in Bangladesh.
The co-operative lending scheme originated in 1976, in the work of Muhammad Yunus at the University of Chittagong, who launched a research project to study how to design a credit delivery system to provide banking services to the rural poor.
According to the website http://www.grameen-info.org/ the Grameen Bank works as follows: A bank unit or lending scheme is set up with a field manager and a number of bank workers, covering an area of about 15 to 22 villages.
The field manager works more like field officers of non-governmental organisations or quasi-government organisations in much of Sub-Saharan Africa.
The manager and workers start by visiting villages to familiarise themselves with the local milieu or environment in which they will be operating and identify prospective clientele, as well as explain the purpose, functions, and mode of operation of the bank to the local population.
This ensures community ownership of the lending scheme. The key feature of each bank unit is the desire and zeal of the members to ensure that the new venture survives all initial challenges and becomes sustainable.
In this regard, the solvency and the continuation of the lending function of the bank unit is guaranteed by making sure that initial borrowers demonstrate willingness and ability to repay loans obtained from the bank before extra borrowers are accommodated by the bank.
The instalment next week will explore the three remaining pillars of co-operative governance which may contribute to better organisational leadership and effectiveness – democracy, strategic leadership and accountable or responsible empowerment.
Ian Ndlovu is an economist based at the National University of Science and Technology skilled in data analysis using SPSS, Gretl, Stata, Eviews and Microsoft Excel software packages.
His research interests cover business, development, economic and e-commerce issues. He writes in his personal capacity.
