social cooperatives and their importance

01 March 2020

Social Cooperatives and their Importance

In literal terms, cooperative means working together.

The overall aim of cooperatives is to meet the needs of their members, who come together voluntarily in the same social environment, profession and living standards, at a minimum cost. Cooperatives enable their members to come together and do things they otherwise cannot do alone.

Thus, members can combine their capital, make investments and generate a return under the cooperative. This enables suitable cooperative models to create an inflow of individual savings into the economy. For instance, construction cooperatives are established to meet the fundamental housing needs of people by utilizing their small savings. They also help reducing unemployment by hiring workers during construction and eventually, contribute to the nation’s economy with taxes and duties paid to the public authorities.

In this regard, cooperatives envisage a model that targets social development and requires solidarity and cooperation.

Furthermore, social cooperatives have started to attract a lot of attention among cooperative models in terms of combining the aim of creating social benefit and the entrepreneurial spirit of for-profit organizations. As a social entrepreneurship model, many EU nations have established legislative grounds for social cooperatives.

Social cooperatives focus on encouraging the integration of disadvantaged individuals, particularly those with disabilities, immigrants and people suffering from long-term unemployment into society and business life, as well as providing them with social, health, education and environmental services.

In social cooperatives, power flows bottom-up rather than top-down with a democratic structure including the members in the decision-making process.

Social cooperatives targeting public interest do not seek profit. They focus on creating social added value rather than material added value.

Article 171 of the Constitution of the Republic of Turkey requires the State to take measures to ensure the development of cooperativism. Accordingly, the Ministry of Trade has been tasked to develop cooperativism within the framework of legal regulations such as the Law on Cooperatives No. 1163. Particularly in the last few years (with the effect of issues that have arisen with the arrival of Syrian refugees in Turkey), public-led projects have emphasised the need to support economic and social functions, such as social cooperatives creating new employment areas, developing a culture of entrepreneurship and cooperation, increasing social capital, fairer distribution of income, and reducing poverty.

Although there is currently no special legislation for social cooperatives in Turkey, a social entrepreneurship model can be established and enforced with existing legal regulations (e.g., Law on Cooperatives and the Turkish Commercial Code). For instance, the SADA Women’s Cooperative for Production and Business was established this year by Turkish, Syrian, Iraqi, Afghan and Iranian women under the “Strengthening the Resilience of Syrian Women and Girls” project in partnership with UN Women, ASAM and ILO. SADA will produce packaging, textiles and regional culinary products and will thus provide both employment and income to the women under its roof.

Models such as social cooperatives should be used to strengthen disadvantaged groups such as refugees, to integrate them into society, and to support their livelihoods through employment. This model is particularly suitable for ensuring the sustainability of the targets and impacts of the projects carried out with financing from non-governmental organizations. The use of social cooperatives will also have a positive impact on the elimination of concerns that may arise in terms of accountability and transparency from the institutions and/or organizations providing financing.

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