Measuring the sustainability of agricultural cooperatives in Oromia Regional State, Ethiopia

A scorecard approach

Abstract

Cooperative revitalization programs in countries such as Ethiopia heavily stress sustainability and provide business skill training for the leadership and management. Cooperatives are business entities, by nature socially responsible and eco-friendly enterprises. Moreover, cooperatives lag behind in advancing a comprehensive sustainability agenda. It is a high time to have an attempt to investigate sustainability of cooperatives by considering three dimensions economic, social, and environmental sustainability. The present research paper intends to analyze the economic, social, and environmental dimensions of cooperatives sustainability; to assess the cooperatives sustainability level by ranking among cooperatives in the study area; and to examine the sustainability oriented competitive strategies adopted by sample cooperatives. Since the research intends to analyze the sustainability of cooperatives, field survey method will be followed. Multi-stage sampling method was adopted to select study area, cooperatives and respondents. At the first stage, among 18 woredas in west shoa zone, Dendi woreda was selected based on the justification that there is high concentration of agricultural cooperatives. At the second stage with the justification of more membership, access and availability of data, out of 23, six cooperatives were selected. The sample size was 100, and adopting PPS members from each cooperative were selected. The sustainability of cooperatives was analyzed by sustainability score card approach advocated by Measuring Cooperative Difference Research Network (MDCRN), Canada with sustainability Indicators which are combined sets of environmental, economic and social performance indicators. Moreover, for data analysis and assessment of sustainability level for ranking of cooperatives, Morris Inequality Index was used. Agricultural Cooperatives in the study area are involved in the economic, social, and environmental dimension of cooperative sustainability. From the foregoing analysis it can be concluded that the agricultural cooperatives do have better position with economic sustainability, to some extent social sustainability, but they do not have favourable situation in environmental sustainability so that the cooperatives are located at moderate and low level of sustainability condition. With regard to comprehensive cooperative sustainability the same result is seen among sampled cooperatives. It is evident that the sustainability level and ranking are in consonance with the sustainability strategies they adopted. There is a need to identify and develop a new vibrant cooperative economic model, which addresses the economic challenges cooperative stakeholders face, as well as the social and environmental challenges disturbing cooperative sustainability. It can be achieved only through practicing and adopting right sustainability strategies at right time effectively. By this research undertaking, the outcomes will have policy implications to intervene for developing cooperatives sustainability, whereby cooperatives may contribute more to the Ethiopian Agricultural Cooperatives Development Strategy and ILO’s declaration as “Cooperatives for Sustainable Development”.