CECOP has submitted a response to the European Commission’s consultation on scenarios towards co-creation of a transition pathway for a resilient, innovative, sustainable, and digital proximity and social economy ecosystem. The proximity and social economy ecosystem is one of the 14 industrial ecosystems identified by the European Commission in the 2021 Industrial Strategy update, and the third one for which the Commission is preparing a transition pathway.
Transition pathways are intended to guide the green and digital transitions of EU industry, or the so-called twin transition. According to the European Commission, the objective is to co-create them jointly with industry and stakeholders, thus identifying which actions need to be taken by 2030.
The following are some of the main points in CECOP’s position on the green and digital transition for the proximity and social economy ecosystem. You can read the full position below. The link to the consultation and the Commission’s reference document is available here (consultation is open until 28 February 2022).
The role of industrial and service cooperatives in the twin transition
Industrial and service cooperatives have an important role to play in making the twin transition inclusive. By virtue of their business model – which is based on such principles as worker ownership, democratic governance, reinvestment of profits and a strong link with their communities – CECOP members contribute to a more inclusive and just economic transition for everyone.
One important concern for worker cooperatives is ensuring that the green and digital jobs are quality jobs, which includes workers’ involvement in the governance of the enterprise, work-life balance, long-term contracts, and other benefits for the employees. Moreover, worker and social cooperatives commit to not leaving vulnerable and underrepresented groups behind when it comes to the green and digital transition, including women, youth, people with disabilities and inhabitants of rural and remote regions.
Cooperatives are already active in key sectors and activities related to the green transition, such as circular and sharing economy, waste management, sustainable construction, energy, mobility, and tourism. They contribute to innovation activities leading to new and more sustainable economic systems, and to strengthening synergies between public and private actors. Since they are deeply embedded in the local communities, cooperatives build mutually beneficial partnerships with local authorities and other stakeholders “on the ground” to implement sustainability-related projects.
In digital transition, cooperatives can offer, among other things, cooperative data management models for democratically controlled data and shared data standards, thus promoting open and transparent use of technologies that is in line with the values of the social economy. In addition, platform cooperatives represent a successful model for the platform economy which provides tangible advantages to all stakeholders: workers with quality working conditions and adequate protection, consumers, as well as regions or states where the platform operates, since they help retain revenues and taxes locally.
Supporting industrial and service cooperatives in the green transition
In order to be able to fulfil their mission even better, cooperatives need increased support from the EU and national authorities. At the moment, they are facing numerous challenges. One of these relates to the low level of investments, especially for small and medium cooperatives. Large investments, including long-term capital, are needed for decarbonization projects. Another issue is difficulty in attracting workers with green skills, especially in rural and remote areas; in addition to creating “new green jobs”, it is also crucial to ensure up-skilling and re-skilling for the existing ones. Additionally, wide disparities exist between EU regions and member states, and cooperatives in certain member states do not enjoy favourable policy and legal environments, which stymies both their growth and their ability to contribute to the green transition.
Some of the policy recommendations proposed by CECOP in order to support industrial and service cooperatives in the green transition include:
Supporting industrial and service cooperatives in the digital transition
Similarly, as in the case with green transition, industry and service cooperatives need enhanced support measures in order to fully embrace the digital transition. Support is needed both for emerging digital industries, and for cooperatives active in traditional industry sectors; both for “new digital jobs” and for upskilling and re-skilling for the existing jobs. Some of the key issues on this path concern lack of ambitious investment programs and issues in access to capital; insufficient funding for innovation and insufficient support in access to technology; and issues in skills mismatch and attracting workers (incl. young graduates) with digital skills. Many issues are particularly pronounced in rural areas, where digital transition is also slower. Furthermore, attention must be paid to the administrative burden, especially for digital cross-border activities; challenges in the data management and data sharing, particularly for cooperatives active in health and care; and poor working conditions for workers, lack of transparency in algorithms and data management in the platform economy. Finally, disparities between EU regions and member states and lack of enabling environment for cooperatives in some of them also pose challenges for cooperatives active in the digital transition.
Some of the CECOP’s policy recommendations on supporting industrial and service cooperatives in the digital transition are:
Inclusion of vulnerable, disadvantaged, and underrepresented groups must also be prioritized at the policy level. In particular, it is crucial to ensure that women are taken into account in the green and digital transition and that the European Commission pays attention to the gender perspective in the context of employment and skills policies.
It is important to develop and promote standardized tools for assessing the sustainability impact of cooperatives, as discussed in CECOP’s recent publication. Beyond just help with finding financial investors, social impact measurement helps cooperatives improve their services and highlights their contribution to the economic, social, and environmental sustainability in their communities.
Finally, it is crucial that all the actions and measures foreseen by the European Commission and Member States toward green and digital transition are accessible to cooperatives active in all sectors, including the industrial sector.
You can read CECOP’s full answer to the consultation here.
Picture: European Commission