Socialising Cooperatives in Ethiopia: The Quest for SocialCooperative

Abstract

 With the emergence of the social enterprise business model, the service horizon
of cooperatives has expanded beyond their members to address humanity's
pressing concerns. The new wave of social entrepreneurship in the cooperative
sector has forced countries to develop regulatory responses, such as creating a
social cooperative form or labelling cooperatives with a primary social purpose as
“social enterprise”. In Ethiopia, social enterprise is growing within the
cooperative sector, although it lacks a distinct form or label. The use of the
cooperative form by social enterprises raises the question of whether existing
cooperative law is sufficient to accommodate and promote social business or
whether a special legal regime is needed. Against this background, using doctrinal
and empirical analyses, this article revealed that the existing law is not prohibitive;
however, it is inadequate in creating a clear legal identity, addressing regulatory
concerns, and fostering a supportive ecosystem. Therefore, this article
recommends introducing a social cooperative through either a dedicated special
law or an amendment to existing cooperative law, in a manner that adequately
addresses the special regulatory concerns posed by its hybrid nature.