Abstract
PurposeMost research into the relationship between social capital and cooperatives takes social capital as the independent variable and the cooperative as the dependent variable, but as yet the authors know little about causality in the other direction. The purpose of this paper is to examine whether the cooperative structure helps to maintain organizational social capital.Design/methodology/approachSemi-structured interviews were conducted with 46 participants from local banks (chairpersons, directors, managers, team leaders and human resources managers).FindingsAlthough the cooperative structure formally remained in place, integration into financial markets and digitalization effectively disembedded the organization from its original social context. The cooperative model can only remain distinctive, in terms of how it relates to its clients, under certain institutional conditions.Practical implicationsThe findings suggest that scaling, in response to changes in the institutional environment, was an important factor in changing the nature of the organization.Originality/valueThe paper contributes to the understanding of the social dynamics of cooperatives in the field of financial services.
Highlights
The global economic and financial crisis of 2007/2008 brought about a renewed interest in alternative types of economic organizing [1]. Mair and Rathert (2019) have noted that alternative types of organizing economic activities, for a social purpose, have the following characteristics: they pursue multiple economic and social goals; they attend to local needs; they marshal underused resources or make do with limited resources; and they experiment with democratic decision-making
This can partly be explained with reference to their positions within the bank, it goes against the desired 80%–20% direct contact principle stated in the policy of the central Rabobank Group
In the case of this particular bank, an organizational structure that promotes collective action was a necessary, but not sufficient condition for the creation and maintenance of organizational social capital
Summary
The global economic and financial crisis of 2007/2008 brought about a renewed interest in alternative types of economic organizing [1]. Mair and Rathert (2019) have noted that alternative types of organizing economic activities, for a social purpose, have the following characteristics: they pursue multiple economic and social goals; they attend to local needs; they marshal underused resources or make do with limited resources; and they experiment with democratic decision-making. Mair and Rathert (2019) have noted that alternative types of organizing economic activities, for a social purpose, have the following characteristics: they pursue multiple economic and social goals; they attend to local needs; they marshal underused resources or make do with limited resources; and they experiment with democratic decision-making. These characteristics certainly fit the original cooperative model, which in its modern form emerged in Europe in the nineteenth century as a response to financial and social exclusion. We know far less about how such organizations develop in the longer term and whether their presumed distinctiveness holds up over time
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