Co-operative social enterprise in Scotland
Posted: 28 June 2021, in News
What makes co-operatives distinctive, in the social economy and generally, is how they combine collective endeavor with democratic ownership and governance. By design, they share power and wealth.
Co-ops have been a critical part of Scotland’s social economy for more than a century and remain so today. At last count there were over 564 co-ops in Scotland with a combined turnover of over £1.5bn. Most of these businesses meet the most widely used definitions of social enterprise.
In today’s thriving Scottish social economy, the co-operative approach to social enterprise – democratic, collaborative, and distributive by design – is shown to be very effective.
For example, take community shares, a democratic and co-operative approach to social investment. Proportionally, Scotland leads the UK in the use of community shares. The model is an increasingly important part of Scotland’s community ownership landscape, with Community Shares Scotland reporting rising take-up of the model in the past year.
Community shares are a proven means for people to pool resources and mobilize financial and social capital simultaneously. Recent research found that using community shares helps to create very effective, financially robust and resilient social enterprises.
Or take Scotland’s strong credit union sector. These co-operatives pool community wealth, in order to provide safe, ethical and empowering financial services. Being owned and controlled by their customers helps ensure they respond to community needs and safeguards their purpose. In helping financially vulnerable households to save and access non-exploitative credit they deliver enormous social impact.
But there are areas where Scotland may be falling behind.
Scotland boasts some excellent housing co-ops, especially in the social rented sector. But these are decades old. While there is renewed growth in co-operative and community-led housing in England and Wales, we’re not yet seeing this in Scotland. Given their unrivaled ability to offer private renters affordability combined with security, community and control, this needs to change.
Worker co-ops exist to provide empowering, wellbeing enhancing livelihoods. Given the scourges of working poverty, insecurity and mental-ill health, their social mission could not be more relevant. There are some excellent examples in Scotland. But new Scottish worker and freelancer co-ops are a rarity and existing ones often feel excluded from support aimed at the social economy.
In other parts of the UK we are also seeing a growth in hybrid co-ops that have workers, service users and/or the community as members. The combination of community benefit and empowerment with worker benefit and empowerment is showing real promise. But we are not currently seeing this model adopted in Scotland.
The hybrid model is proving especially popular among those developing platform co-ops. Ethical and democratic digital platforms could enable social action and deliver significant social impact. Co-operatives UK is currently supporting six early-stage platform co-ops through an accelerator programme, UnFound, though none are from Scotland.
Co-operatives UK is eager for Scottish co-ops to benefit from initiatives to support social enterprise. We’d also like to see Scottish social entrepreneurs exploring ‘co-operative approaches’ to social enterprise (i.e. democratic, collaborative, distributive by design) as a matter of course.
The Scottish Government clearly has a critical role to play here, not least through its Social Enterprise Action Plan. Government already puts resource into developing community co-ops, to great effect.
There is a very strong case for expanding on this to promote and support other pivotal co-op models, such as housing co-ops, worker and hybrid co-ops and platform co-ops. The social value generated as a result would repay any outlay many times over.