UNRISD Conference

Guy Ryder's opening remarks to the UNRISD Conference on Social and Solidarity Economy

Statement | Geneva | 06 May 2013

Good morning,
Minister Singer,
Mr Coraggio,
Mr Laville,
Ladies and gentlemen,

Firstly, let me welcome you to the International Labour Office in Geneva.

We are happy to be working together with UNRISD to co-host this conference on the Social and Solidarity Economy. Since becoming Director-General of the ILO last year, one of my priorities has been to strengthen the ILO’s research capabilities, and in this I have had the strong support of the ILO’s Governing Body. And part of our research efforts should certainly be in close collaboration with other United Nations agencies and research institutions. At the ILO we look forward therefore to building on the ideas and research proposals that will emerge from these three days of presentation, discussion and exchange.

We are at a particularly pressing moment in history for us to do so effectively. You do not need me to tell you of the seriousness of the challenges confronting the global economy, from the historically high unemployment rates particularly for young workers to the problems of exclusion and increasing inequality, persistent poverty in rural areas and unacceptable conditions of work in the informal economy. Overcoming these challenges requires fresh thinking to elaborate innovative policy proposals that can provide practical assistance to the real problems people face.

The concept of the “social and solidarity economy” has been recognized on various key occasions by the ILO. In 2008, the unanimously adopted Declaration on Social Justice for a Fair Globalization recognized a strong social economy as critical to sustainable economic development and employment opportunities, along with productive, profitable and sustainable enterprises and a viable public sector. Five years earlier, the ILO Promotion of Cooperatives Recommendation, No. 193, stipulated that: “A balanced society necessitates the existence of strong public and private sectors, as well as a strong cooperative, mutual … social and non-governmental sector.”

Numerous initiatives have been undertaken since then around the world. Revisions of legislation regarding cooperatives, in line with the provisions of Recommendation No. 193, have resulted in more autonomy, independence, and business viability in over 70 countries. France and Brazil have established Ministries of Social and Solidarity Economy. In the past two years, Greece, Ecuador, Mexico, Portugal and Spain have all passed legislation to improve the legal framework for the social and solidarity economy, something which shows the relevance of SSE to today’s economic and social crisis. In 2009, the ILO held a conference in Johannesburg on “The Social Economy – Africa’s Response to the Global Crisis” in response to the requests from its constituents in the region. The participants, who came from governments, employers’ and workers’ organizations as well as social economy enterprises of 15 African countries, adopted a Plan of Action for the promotion of social economy enterprises and organizations on the continent.

Since 2010, the ILO has held three meetings of what we call a “Social and Solidarity Academy”, in Turin, Montreal, and Agadir, bringing together academics, practitioners and constituents to discuss the subject. Several ILO Decent Work Country Programmes and technical cooperation projects have been promoting cooperatives and other social and solidarity economy enterprises as central tenets of their response strategies to development challenges, through generating youth employment, strengthening rural employment and addressing the informal economy. In 2013, the ILO initiated research documenting and analysing legal innovations in the social and solidarity economy.

All these ILO activities have drawn attention to an extraordinary diversity within the social and solidarity economy, and to its potential for innovation to respond to unmet social needs. We are also well aware of the challenges that exist around the social and solidarity economy. This conference will be addressing some of these, from definitional problems to policy implications, both in the current context and beyond.

Let me also take a moment to draw your attention to the discussions that are gathering momentum on the post-Millennium Development Goals that will apply after 2015. In that context, the ILO has been calling for a job-centred development agenda that prioritizes full and productive employment and decent work, along with social protection floors for poverty reduction and resilience.

You may ask, in what way are these goals related to social and solidarity economy enterprises and organizations? Well, not long ago I met the President of the International Cooperative Alliance, Dame Pauline Green, and we discussed four critical areas for joint action: the economic crisis, youth employment, the informal economy and rural employment. I would like to briefly comment upon these four areas before passing the floor to our keynote speakers.

First, ILO research shows that cooperative enterprises around the world are showing resilience to the crisis. Financial cooperatives have remained far more sound than most of their sector; consumer cooperatives are reporting increased turnover; and worker cooperatives are seeing growth as people choose that option in order to respond to new economic realities. And the survival rate of worker cooperatives in several countries appears to equal or surpass that of conventional firms.

Membership in other social and solidarity economy enterprises and organizations is also increasing. In Europe alone, the social and solidarity economy provides paid employment to over 14.5 million people, or about 6.5 per cent of total European paid employment. The social and solidarity economy can therefore be a key building block for a jobs-oriented recovery strategy. Evidence-based policy in that regard requires further research and statistics to track the quantity and quality of the jobs created. The forthcoming International Conference of Labour Statisticians this October will look into the issue of statistics on cooperatives, as a starting-point. The ILO is also working in crisis countries, starting with Greece, on enterprise restructuring via worker cooperatives.

Second, youth employment. Close to 75 million young people are out of work, 4 million more than in 2007. An increasing number of young people are “neither in employment nor in education or training” especially in developed countries. The conclusions of the International Labour Conference in 2012 highlighted the importance of cooperatives and social economy enterprises for tackling the youth employment crisis. Given the opportunity, they can provide youth with gainful wage- and self-employment.

In that context, an enabling environment is critical for businesses, cooperatives and social enterprises to thrive. The ILO is providing assistance in this regard, and I would like to mention a number of our technical cooperation projects. For example, in Kenya and Zimbabwe, the project on Youth Employment Support, Jobs for the Unemployed and Marginalized Young People, or YES-JUMP, supports entrepreneurship and cooperative development through vocational skills and business training. Along with COOP Africa, YES-JUMP has developed a Challenge Fund which provided increased access to financial services for young people. To date, more than 1,500 young people have become members of such Youth Savings and Credit Cooperatives that are managed by youth themselves.

Regarding the third area I mentioned, the informal economy accounts for between 35 and 90 per cent of total employment in many developing countries, and is not confined to traditional rural and urban informal locations. Various types of informal contracts, precarious employment and undeclared work have been gaining ground in formal establishments as well. Informal work therefore reflects very diverse realities of wage and self-employment worldwide.

Social and solidarity economy can be a bridge for workers and enterprises to get out of informality. Many cooperatives start as informal group enterprises and later, as they grow and become viable business enterprises, they are registered. As legal entities, they become part of the formal economy.

Fourth, I would like to remind you that rural areas are home and workplace to half of the world’s population, and 75 per cent of the world’s poor. In the rural economy, cooperatives, mutual benefit societies, and micro-finance organizations are key actors in addressing the goals of poverty reduction, food security and social inclusion. These organizations can play a role in the promotion of rural entrepreneurship, employment creation, and providing representation to rural workers.

Cooperatives play a particularly important role, particularly where private businesses hesitate to go into rural areas and public authorities do not provide basic services. They are often instrumental in providing opportunities for productive employment as well as provision of health care, education, water, improved sanitation, roads, and market access.

Agricultural cooperatives can offer smallholders a wide range of services, such as improved access to markets, inputs, information, technologies, loans and other financial services, training and even to warehouses, thus contributing to poverty alleviation and food security.

In conclusion, I would like to emphasise that in times of multiple crises like today, when austerity is often a dominant response, decent work is at risk. We need to have a deeper understanding of what social and solidarity economy enterprises and organizations can offer to secure the expansion of decent and productive employment opportunities in a sustainable framework. We also need to have a better grasp of what social and solidarity economy enterprises and organizations need to be enabled to do.

Ladies and gentlemen, the ILO stands ready to follow up and play a leading role in translating the outcomes of this conference into research, policy and action to achieve better strategies and interventions. I wish you a successful and fruitful event and I would like to thank you once again for your participation.