- Self regulation could give cooperatives greater flexibility to compete and innovate.
- Weak leadership and reliance on rigid rules remain major barriers to reform.
- Stronger federations and technology could help the sector embrace self regulation.
The National Cooperative Policy that has since transmuted into Sessional Paper No 4 of 2020 advocates for, among other things, the adoption of self regulation by the cooperative sector as it grapples to find its space in the highly competitive business environment.
Self regulation is intended to create a paradigm shift in the manner cooperative management is carried out. Presently, more attention is paid to compliance to policies and regulations that are fairly rigid and have little or no room for flexibility.
This is referred to as “transactional leadership” as opposed to “transformational” or “transformative” leadership. In the latter case, organisations are constantly alive to dynamics occurring in their industry and therefore embrace a very flexible approach aimed at enabling them to remain relevant and competitive.
The practice where cooperatives adhere religiously to their plans/budgets may serve as effective control measures but at the same time, they forgo many opportunities they could otherwise explore in the course of their business.
As the sector has grown in leaps and bounds, there has arisen need to embrace global best practices, some of which require adoption of progressive approaches to issues.
Why embrace self regulation?
Our cooperatives are engaged in diverse socio-economic activities and at the same time are not at the same level of development or advancement.
By embracing self regulation, cooperatives would have a free hand in setting their goals that they can keep monitoring as they implement them.
Above all, the feeling that they are in charge of their destiny would propel the leadership to be on their toes since the success or otherwise would be directly attributed to those in the leadership.
Under the present system, buck-passing has been the norm, with many players pointing fingers at the delayed enactment of the amended cooperative legislation.
While this has been (and continues to be) the perfect scapegoat, they forget that the Sessional Paper highlights an array of interventions that should be running simultaneously with the review of cooperative legislation.
For example, there should be capacity building programmes being carried out for the various categories of stakeholders, preparation of education and training materials reflecting devolution and the new normal, preparing cooperatives to embrace the hybrid system of holding general meetings, and transforming Transport Saccos into Transport (Service) cooperatives by amending their respective bylaws, among others.
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It is therefore escapist to hide behind the ongoing review of the Cooperative Societies Act and continue doing business as usual.
The benefits that would accrue to self regulation far much outstrip the transactional type of management, where cooperatives in the various value chains are expected to operate in a uniform manner guided by very rigid rules and regulations.
What do we need to actualise self regulation in the cooperative sector?
We need progressive leadership that is capable of providing effective strategic direction to the institutions they lead. A good leader will be felt in terms of rallying his/her members towards some set goals. This is as opposed to “office holders” who are, by and large, complacent and are likely to resist introduction of new ways/ideas of doing business.
For the cooperative sector in this country to take its rightful place in the region and on the global arena, we need to transform it in order to endear it to the majority youths, leveraging technology that is the new tool of trade!
Let the cooperative leadership in the country give adequate space to the technocrats in the sector to create a positive revolution in the country’s cooperative sector, which has immense potential in terms of participating in the implementation of the relevant sustainable development goals (SDGs).
Ideally, self regulation should be championed by the various federations since they understand their value chains well. Such an approach would also absolve the government from intermittent blame in the event mismanagement is perpetrated by the cooperatives themselves.
What is not in doubt is that the cooperative sector has come of age and should be given the latitude to regulate their internal affairs as long as they operate within the confines of the law. Surely, they cannot be babysat forever.
By Fred Sitati
Co-operative Movement Consultant
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