Governance and Change
For the subject area on Governance, it will be assumed that the ways in which cooperatives adapt to changes in their own business development and changes in the market environment follow a certain pattern within which typical problems of governance appear. In the process of adaptation, they go through typical stages in which they change business strategies and adapt their mechanisms of management control (internal governance) [1]. For research, this implies that the stages in cooperative life cycles have to be categorized and identified prior to analysis, because cooperatives in different stages of their business lifecycles may act and react differently to internal and external drivers of change [2]. The Raiffeien Chair analyzes important stages of development and strategic decisions of German and European cooperatives. The objective is to locate differences and commonalities in the development of life cycles, adaptation of internal governance structures and strategic decisions in selected German and European cooperatives and relate them to the theoretical and empirical literature [3]. For reaching this goal, it is important to first develop a classification of different types of cooperatives on the basis of the existing literature and to better substantiate this classification with a systematic and collaborative collection of case examples from around the world [4]. On the basis of the results of this classificational task, comparative analyses are to be conducted and an attempt made to formulate hypotheses on foreseeable problems in particular stages, paths of development of internal governance structures and future strategies for agricultural cooperatives in Germany. Results are compared with the results of similar analyses from the Netherlands, Sweden, the USA and Canada. The main goal is to arrive at a better understanding about the likely future development of agricultural cooperatives in Germany and the EU. Since 2012, a quantitative database and 33 case studies on agricultural cooperatives in the EU have been compiled by researchers of the EU-tendered project Support for Farmers’ Cooperatives. This data, which also includes data on internal governance structures of cooperatives, will need to be analyzed on the basis of a comparative research concept and complemented by other cases and databases. Subject area Governance focuses on investigating the typical patterns of development of agricultural cooperatives, how these patterns differ between sectors and branches, how adaptation scenarios differ between sectors and branches, how cooperative management judges the determinants of crises in different stages of cooperative life cycles, and how different adaptation strategies can impact the performance and success of cooperative enterprises. Results should increase understanding of how agricultural cooperatives adapt to change, what kinds of compromises are made between principles of traditional cooperative organizations and the requirements of modern agribusiness enterprises and how agricultural cooperatives will look and perform in the future.
[1] In general, the term “internal governance” describes structures and processes of decision-making within organizations. It is concerned with who has decision-making rights (and over what issues), who has the right to monitor and control decision makers, and who has residual claim rights to profit generated by a particular organization. Thus, the concept of internal governance in cooperatives is closely linked to the concept of corporate governance in shareholder-value or profit-driven firms (See Bijmann, van der Sangen & Hanisch 2012), Zingales, 1998; Shleifer & Vishny, 1997).
[2] See Cook & Burres (2009).
[3] See Bijman (2003); Nilsson (1999); van Bekkum & Nilsson (2000); Chaddad & Cook (2004); Cook & Burres (2009).
[4] See Cook (1995); Chaddad (2007).