Social and Solidarity Economy: A Pathway to Socially Sustainable Development?

This is part of a series of think pieces by scholars and practitioners working on a broad range of issues within the field of Social and Solidarity Economy. The series is being published in conjunction with the UNRISD conference “Potential and Limits of Social and Solidarity Economy”. The conference took place on 6-8 May 2013 in collaboration with the International Labour Organization and the UN Non-Governmental Liaison Service.

As the international community attempts to tackle a complex set of twenty-first century development challenges, attention has focused on the possibilities of more integrated models of development. This think piece argues that both the concept of sustainable development (centred on economic growth, and social and environmental protection) and the classic model of what can be termed “embedded liberalism” (centred on the welfare state and the decent work enterprise), are found wanting from the perspective of integrative development. In today’s world five key dimensions need to be addressed simultaneously: economic development, social protection, environmental protection, gender equality and sociopolitical empowerment. The field of Social and Solidarity Economy (SSE) seems to have considerable potential in this regard. Can that potential be realized?

As SSE diversifies and expands, it is inevitably drawn closer to both states and for-profit enterprise. Whether SSE can grow and retain its core values and identity will depend very much on the nature and terms of its relations with other sectors. It will also depend on its capacity to organize beyond the micro- or local level and cohere as a movement at other (national, regional and international) scales. The reflections in this think piece suggest not only that policy makers should be paying far more attention to SSE but that they also need to be broadening their approach beyond a focus on the economic empowerment of individuals, and more toward groups and political empowerment, and beyond social and environmental protection toward equality and emancipation.

Peter Utting is Deputy Director of the United Nations Research Institute for Social Development (UNRISD where he currently coordinates research on Social and Solidarity Economy and corporate social responsibility.

Beyond sustainable development

Contexts of economic liberalization, financialization and globalization have placed in stark relief the social and environmental contradictions of market-centred development processes. In response to concerns about precarious employment, persistent poverty, inequality and global warming, the international development community has refocused its attention on the concept of sustainable development. Indeed, the 2012 Rio+20 United Nations Conference on Sustainable Development called for urgent action to “mainstream sustainable development at all levels, integrating economic, social, and environmental aspects and recognizing their interlinkages” (UN Secretariat 2012). In policy terms this generally involves raising the profile of certain social and environmental goals, policies and regulations in an attempt to overcome their residual status, or to explicitly attain so-called co-benefits or win-win situations, as in the case of efforts to promote green economy. Such an approach also underpins much of the thinking currently underway in relation to the post-2015 (MDG) agenda.

However, contemporary interpretations of sustainable development often downplay two of the key dimensions of development outlined above:

• conditions for social reproduction associated with the care economy that impact heavily the role of women and gender equality, and
• socio-political dimensions of development and change that involve significantly reconfiguring power relations in favour of disadvantaged groups.

The term socially sustainable development, which is gaining currency, perhaps better captures this more integrative perspective on development, if by “socially” we understand two aspects. First, not only aspects related to protection and needs (already central to the concept of sustainable development) but also the transformation of fundamentally unjust or unequal social (and power) relations, and second, the ways that progressive change is reproduced through socially embedded or responsive institutions.

What organizational and institutional arrangements might foster socially sustainable development? The institutional and political history of the twentieth century teaches us that both developmental and welfare states, as well as collective action on the part of organized workers and farmers were key for ensuring that markets and corporations acted within a socially acceptable frame. Under this model of embedded liberalism, principles and practices related to efficiency/productivity, equity/social protection, and advocacy/participation were, at least to some extent, mutually reinforcing. The integrative potential of this approach centred on three of the five dimensions of socially sustainable development noted above. Far more problematic were dimensions related to environmental protection and gender equality. Embedded liberalism came to be associated with both an industrialization and consumption model that polluted the planet, and with a male bread-winner model that assumed a woman’s place essentially revolved around the home. From both a structural and normative perspective this model has run up against definite limits.

Historical agents of progressive change, namely states and the labour movement, have, in various regards, had their wings clipped by market forces. Can the task of crafting a twenty-first century social pact and a fairer economic and social system now be driven by new coalitions that include other civil society actors and institutional forms? The key challenges for collective action of workers and producers today would seem to be three-fold. First, how can micro-level organizations and enterprises that support multiple development objectives be promoted in contexts of ongoing flexibilization of labour markets and informalization? Second, how can the integrative potential of micro-level organizations—related to the economic, social and political dimensions mentioned earlier—be expanded by incorporating principles and practices related to environmental protection and gender equality? And third, how can producers and workers not only organize collectively at the micro level of production and communities, but also cohere as a movement, forge alliances with other social and political actors, and impact policy and institutions at multiple scales (national, regional and global)?

Social and Solidarity Economy: An Idea Whose Time Has Come

How has the international development community responded to these concerns? While decent work remains an important goal, other approaches have come to the fore. These include:

• the social protection agenda centred on safety nets, targeting and social floors;
• the active promotion of entrepreneurialism, support for small and medium sized enterprises, and the economic empowerment of women and small-scale producers;
• corporate social responsibility;
• the green economy agenda that explicitly couples economic and environmental objectives.

While each of these approaches has some ameliorative potential, they are generally found wanting from the broader perspective of socially sustainable development. Several such approaches tend to add on a bit more social and/or environmental protection, whilst downplaying or ignoring other key dimensions, not least, the social and environmental impacts of macro-economic policy, women’s double burden associated with low-paid work and unpaid care, and political dimensions of change. Sociopolitical aspects are often reduced to the notion of participation as consultation with selected stakeholders or voting once every few years rather than any fundamental shift in capacities to exert claims on powerful actors and institutions and hold them accountable on a more regular basis (Utting 2012).

If policy makers are to seriously address the challenge of socially sustainable development, they would do well to look at another approach that appears to be gaining traction in many economies and societies. In contexts of not only precarious employment and multiple and recurring crises (finance and food), but also new opportunities for cultural expression and social interaction, workers, producers, consumers and communities are organizing collectively in ways that seem to hold considerable promise for socially sustainable development. The term Social and Solidarity Economy is increasingly being used to capture this new reality. It encompasses organizations and enterprises that:

• have explicit economic and social (and often environmental) objectives;
• involve varying degrees and forms of cooperative, associative and solidarity relations between workers, producers and consumers;
• practice workplace democracy and self-management.

Social and Solidarity Economy embraces older and newer types of organizations and enterprises. They include traditional forms of cooperatives, mutual associations and NGOs, as well as women’s self-help groups, community forestry groups, social provisioning organizations or ‘proximity services’, fair trade organizations, associations of informal sector workers, social enterprises, and community or group currency and finance schemes (ILO 2011; Laville 2010). And not only are individual workers and producers coming together collectively but the organizations they form are coalescing in networks, associations and movements at various scales (local, sub-national, national, regional and global) (Agarwal 2010, Bullard and Müller 2012).

The advantages of collective action associated with SSE have been well documented, often by academics who do not explicitly use the term. Heyer et al. (2002) focus on the merits of group behaviour in terms of three roles it can play. First, when workers, producers and consumers cohere collectively they can enhance capacities and capabilities needed to survive, mobilize resources, grow and compete economically—for example, reducing costs through economies of scale, bargaining for higher prices, accessing market information, human capital formation, or adding value through processing. Second, they can strengthen their ability to exert claims on external institutions and actors that affect their lives. Third, they enhance their capacity to assist others in need through solidarity. Literature on ‘decommodification’ (Vail 2010), which often draws on Polanyi, highlights additional features associated with social protection, commons protection and basic needs. As Nancy Fraser points out, Polanyian literature sometimes (over-) emphasizes the importance of social protection whilst sidelining aspects related to emancipation (Fraser 2012). Various forms of SSE, notably those more clearly associated with the solidarity strand of SSE, relate more explicitly to emancipatory dimensions such as gender and ethnic equality. Organizational literature highlights merits associated with workplace democracy and satisfaction, pointing out features that contrast with the so-called Taylorist stereotype of the atomized, mechanized, alienated worker, highly subordinated to authority. And feminist literature points to the fact that not only has SSE opened up significant spaces for women’s participation in economic and sociopolitical activities, but in some respects at least, there has been scope for minimizing tensions between women’s roles in relation to paid work and household or care activities.

Hence on paper, Social and Solidarity Economy seems to score highly from the perspective of socially sustainable development: it appears to lend itself to simultaneously addressing core development dimensions associated with economic development, social protection, environmental protection, gender equity and socio-political empowerment. But here we need to voice a note of caution. Much of the knowledge base associated with SSE is prone to romanticizing achievements and potential; simplifying or ignoring limitations, trade-offs, dilemmas and contradictions; and downplaying the political and institutional drivers of progressive change. There is often a tendency to focus descriptively on myriad local-level best practices and ignore issues of upscaling, replication and long-term sustainability in what are often extremely different and difficult institutional and societal contexts.

The reality of Social and Solidarity Economy often stands in marked contrast to both theory and anecdotal evidence. In practice, Social and Solidarity Economy exists in relation to other economic and institutional spheres, notably for-profit private enterprise, the public (state) sector, and informal or popular economy (Coraggio 2010). To expand, it will inevitably interact far more with state institutions, corporations and global value chains. Such interactions inevitably generate tensions and dilemmas given differences in development priorities and approaches, as well as differentials in bargaining power.

Also key in determining the potential and limits of Social and Solidarity Economy is how the productive sphere associated with SSE organizations and enterprises articulates with the financial sphere. Furthermore, practice within SSE is shaped by broader cultural and social relations, including those that reproduce gender and ethnic inequality. Politically SSE confronts the challenge that its recent expansion has been largely a grassroots or micro-level phenomenon. Collective action needs to transcend the local level and connect at multiple scales via networks, movements and alliances if it is to significantly impact policy and politics.

Accordingly, as a normative and societal project, SSE confronts numerous challenges, beyond the inevitable constraints associated with lack of certain assets and capabilities. These include situations where:

• there is a disabling policy and regulatory environment, or policy making is top-down and lacks institutionalization, often because it is associated with a particular party;
• where states step in to actively promote SSE but choose only to prioritize selected aspects;
• collective organization and mobilization does not extend much beyond the local level;
• splits or tensions have arisen within SSE networks and movements due to ideological and/or personal differences;
• SSE expansion leans towards market principles and practices and dilutes core features of SSE;
• women’s participation in SSE is associated with additional workloads and ongoing subordination to male hierarchy.

Moving forward

This brief review of the integrative potential of Social and Solidarity Economy suggests that this approach to development needs to receive far more attention within mainstream knowledge and policy circles than is currently the case. This is even more obvious in the context of the contemporary challenge that the international development community has set itself, namely to rethink development strategies in the wake of the global financial crisis, in response to global warming, and as attention focuses on a second round of Millennium Development Goals (MDGs) as well as Sustainable Development Goals (SDGs).

SSE is not only a response to the perils of labour commodification (Vail 2010) but also the perils of an industrial model that is unable to absorb surplus labour. It also deserves more attention in the context of recurring crises (of finance, food and energy), which suggest the need to place a premium on productive and social models that both enhance resilience against external shocks and point to forms of production, exchange and consumption that may hold one of the keys to a less volatile, more caring, economic system. Furthermore, if we add climate change into the equation, then there should be a premium on low-input production systems and features known as voluntary simplicity that imply very different consumption patterns. The current vibrancy of socio-political contestation and advocacy associated with SSE also points to its role in the constitution of a broad-based movement of the type needed to reconfigure power relations in ways conducive to socially sustainable development.

The theory and practice of SSE hold important lessons for policy makers in terms of experiences or models they should be considering. Notwithstanding important examples such as Brazil and Ecuador, national and international policy towards Social and Solidarity Economy is inchoate. Governments, United Nations and other international organizations should be paying far more attention to ways and means of supporting Social and Solidarity Economy organizations and enterprises. This also implies the need to correct certain biases in policy approach with a more explicit focus on

i) groups (beyond individuals)

ii) political (beyond economic) empowerment, and

iii) equality and emancipation (beyond protection).

REFERENCES

Agarwal, Bina. 2010. Gender and Green Governance. Oxford University Press, Oxford.

Bullard, Nicola and Tadzio Müller. 2012. “Beyond the Green Economy: System change, not climate change?” Development, Vol. 55, No.1, pp. 54-62.

Coraggio, José Luis. 2011. Economía Social y Solidaria. El trabajo antes que el capital. Abya Yala, Quito.

Fonteneau, B. et al. 2011. Social and Solidarity Economy: Our common road towards Decent Work. ILO, Geneva.

Fraser, Nancy. 2012. Can society be commodities all the way down? Polanyian relections on capitalist crisis, Fondation Maison des Sciences de l’Homme Working Paper Series No.18, FMSHWP-2012-18, August 2012.

Heyer, Judith, Frances Stewart and Rosemary Thorp (eds.). 2002. Group Behaviour and Development: Is the Market Destroying Cooperation? Oxford University Press, Oxford.

Hillenkamp, L. F. Lapeyre and A. Lemaitre (eds.). 2013 forthcoming. Securing Livelihoods, Informal Economy Practices and Institutions. Oxford University Press, Oxford.

Jackson, Tim. 2011. Prosperity Without Growth: Economics for a Finite Planet. Earthscan, London.

Laville, Jean-Louis. 2010. Politique de l’association. Éditions du Seuil, Paris.

Utting, Peter. 2012. The Challenge of Political Empowerment. http://www.capacity.org/capacity/opencms/es/topics/value-chains/the-challenge-of-political-empowerment.html, accessed 29 April 2013.

Vail, John. 2010. “Decommodification and Egalitarian Political Economy.” Politics and Society, Vol. 38, No. 3, pp. 310-346.