Cooperative Governance - Dr.M.Karthikeyan
Cooperative Governance - Dr.M.Karthikeyan
Cooperative Governance - Dr.M.Karthikeyan
2009
INDICATORS OF GOOD GOVERNANCE PRACTICES IN
SELF EMPLOYED WOMEN’S SAVING AND CREDIT
COOPERATIVES UNION,
ADDIS ABABA, ETHIOPIA
Dr.M.Karthikeyan,
Asst. Professor of Cooperative Management,
Dept. of Cooperatives, Ambo University, P.B.No:511,
Ambo, Ethiopia. Email:[email protected]
Governance in Cooperatives – An
Overview
• The union has the objectives: To improve the performance of the member
cooperatives by providing financial and non-financial services; to ensure sustainable
development when the supporting NGOs phase out; to enhance the society’s ability
in rendering adequate service to their members; to find solutions collectively for
problems that member cooperatives cannot solve; to make sure that cooperatives
are governed by the spirit of cooperative regulation; to enhance the cooperative
movement in Ethiopia; and to mobilize members capital for mutual benefits.
Profile of Union
• Currently, the union has 20 cooperative members with 6,002 individual
members. The total number shares held by member cooperatives are 137 worth
of ETB. 137000. The union is rendering services like, savings and credit to
members, provision of loans like housing, school and group loans, administration
of market shelters, organizing trade fairs, exhibition, bazaars, insurance service
on loans, and administrating income generation ventures. Consecutive and
timely education and training on cooperative principles, values, accounting, etc
are also services rendered by the union.
As for the level of concern about the practice of cooperative principles and value,
the majority (85.71%) of management committee members and 85.0 percent of
representatives of member primary cooperatives have high level of concern, and
only 52.94 percent of employees have high level of concern about the practice of
cooperative principles and values. The reason could be that the employees they
concentrate on their work rather than practicing cooperative principles and
values. The women SACCO union is being practicing cooperative principles and
values for good governance system
Concern about the Cooperative
Governance Pillars
The survey revealed that the level of concern about the practice of pillars of cooperative governance among management
committee members higher than that of representatives of member cooperatives. As for level of concern about the practice
of participation, it is revealed that cent percent of the management committee members have high concern; because they
believe in participation leads to success and good governance. As for transparency and accountability, except one
management committee member all others have high concern; predictability only 5 (71.44%) out of 7 members has high
concern. Among representatives of member cooperatives, 80 percent have high concern about the practice of participation
as a pillar of governance; transparency and predictability 70 percent; and accountability 75 percent as high concern. The
employees have moderate and low level of concern about transparency, predictability and accountability; but somewhat high
concern about the practice of participation as a pillar of governance. The general manager as an employee has high concern
about the practice of all pillars of governance whereas all other employees (secretarial and sub staff) have moderate and low
level of concern except a few with the concern about participation.
At the outset, this women SACCO union is adhering to cooperative principles and values; has more concern about the
practice of pillars of cooperative governance.
Good Cooperative Governance Indicators
• The scales used were grade 1 to grade 5. First grade is very good (85% - 100%); second
grade is good (65% - 84%); third grade is fair (50% - 64%); fourth grade is poor (35% -
49%); and fifth grade is very poor (below 35%). Almost all the issues related to
cooperative good governance as good governance indicators were chosen to administer the
governance issues report card shown / listed out in the table. Under each governance
indicator four issues were addressed and scores were given. The percentage was arrived by
using the simple formula: Percentage = Total score / 20 X 100. After arriving at the
percentage for each indicator of good governance, the overall grade for good governance
was prepared and given in the table.
Overall Grade for Good Governance in
Women SACCO Union
Interpretation
•
• The governance indicators such as, cooperative principles and values,
delegation of power and authority to general manager, transparency,
participation in meetings and business, relationship at all levels, recovery rate,
consensus orientation, and auditing of accounts of the women SACCO union
have scored first grade (very good) while governance indicators like, awareness
of leaders, cooperative proclamation, board duty and responsibility, decision
making, accountability, planning, implementation and control, strategic vision,
elections and voting, committees, risk management, and financial stability and
profitability have scored second grade (good). The governance indicator social
responsibility is given third grade (fair) because of moderate concern about
social responsibility. The concentration on business may be the reason for this
grade given by the members. The overall governance as an indicator of good
governance has scored second grade (good).
• By seeing the results out of Good Governance Issues Report card, it is indicated that the overall
governance of the women SACCO union is “good” and it is suggested that the union should work
for getting the grade very good in cooperative governance.
During FGDs among members,
they reported:
• Observing this, the Women SACCO Union may go for redesign its governance system thereby it can
be more successful. The appropriate governance model can be evolved and designed to suit all
situations and based on their business activities. The committees can be given powers and the
general manager can be delegated with the same functions, and democracy must be maintained as
such. They can blend and merge traditional, stewardship and democratic models and come up with a
redesigned model for more success of the Women SACCO union.
Conclusion
• However, the women SACCO union is an
example of good governance model / framework.
Successful and sound business activities,
participation of stakeholders, transparent financial
management and cooperative governance
influence the success of this Union. It can be a
model women cooperatives union, which practice
good governance for creating a better standard
for other cooperatives in the country.
Thank You