International Summit of Cooperatives, Quebec City

ILO: "Cooperatives can and must play a significant role as value driven enterprises expanding into new and innovative areas"

Keynote address by Sandra Polaski, ILO Deputy Director General for Policy, at the International Summit of Cooperatives Session on Cooperatives and Employment.

Statement | 07 October 2014
Sandra Polaski, ILO Deputy Director General for Policy

It is a pleasure for me to represent the ILO at this second International Cooperative Summit and to be here in this lovely place at such a beautiful time of year. I would like to congratulate the Desjardins Group, the ICA and all the people, workers and businesses who made this enormous gathering of co-operators and their friends possible.

The ILO applauds the Summit organizers for selecting employment as one of the five key themes for this 2014 Summit. Jobs were hit hard by the global financial crisis and job creation remains a major challenge today. Unemployment is still well above pre-crisis levels in many high income countries. Today there are over 200 million unemployed in the world. Informal employment—typically poorly paid, insecure, with low productivity and no social benefits—continues to dominate labour markets in many middle and low-income countries.

Looking forward, the global economy will need to create 670 million jobs between now and 2030 to absorb those currently unemployed and to offer employment to those entering the labour market for the first time.

And the number of jobs needed will be even higher if we are able to increase women’s participation in the work force, a goal of many governments. Increasing employment for women is good for women, who can thereby improve their standard of living and that of their families and it is good for economies, particularly in the many countries where populations are aging.

And of course, as you know, the global youth unemployment rate is almost three times higher than adult unemployment and in some countries it exceeds 50 per cent. We worry about a generation that could be denied its opportunity for decent careers and living standards.

Across the world, we have also seen a long-term deterioration in the quality of jobs, particularly for low and medium skilled workers. In the developing world, nearly one-in-four workers and their families live on less than US$2 a day, constituting the working poor.

Many advanced economies have seen sharp increases in involuntary temporary or short-term contract work, involuntary part-time and low-wage work.

I present you with this overview of the serious challenges in labour markets not to depress or discourage, but because it is highly relevant to cooperatives and their place in economic recovery and sustainable and inclusive growth.

As global attention focuses on these challenges, cooperatives can and must play a significant role as value driven, principled enterprises expanding into new and innovative areas—from health care and high technology to recycling and renewable energy—providing people with employment, know-how, inputs, finance, products and services at fair prices. In a number of countries cooperative enterprises have already proven to be among the key building blocks for jobs-oriented recovery strategies.

At the ILO, we recognize the historical, current, and potential contributions of cooperatives in providing jobs, incomes and economic security, through an entrepreneurship option that allows for people to take the initiative to create new livelihood and employment opportunities, and that provides collective voice and engagement in decision making when challenges to those livelihoods arise, as during the financial crisis.

From its creation in 1919, the ILO recognized the importance of cooperatives in working toward its mandate of social justice and full employment and it remains the only specialized agency of the United Nations with an explicit mandate on cooperatives. In 1920 the ILO established a specialized unit focusing on cooperatives, led by the first ILO Director General who was a leader in the French cooperative movement and a member of the Central Committee of the International Cooperative Alliance. Since then the International Cooperative Alliance has had a consultative status with the ILO,

In recent years, we have updated and revitalized our relationship with the cooperative movement. We welcome the cooperative movement’s Blueprint for a Co-operative Decade and in particular the choice of legislative reform as one of the five pillars of the blueprint. This is an area where we have much to contribute. In 2002, with strong involvement of the international cooperative movement, the ILO’s governing conference adopted an internationally-agreed Recommendation on the Promotion of Cooperatives, which has been utilized by more than 100 national governments in reforming their cooperative legislation since then. ILO’s work on cooperative enterprises continues to be guided by this international standard and we are keen to understand and support progress in legal and policy realms in line with the provisions of this Recommendation. We are ready to work closely with the international cooperative movement on legislative initiatives through relevant units at our headquarters in Geneva, our International Training Centre in Turin and our field offices around the world.

Recently, we have also devoted considerable attention to the role of cooperatives in helping to formalizing jobs in the informal economy. Beginning last June, our policy making- International Labour Conference began discussion and negotiation of a possible new international Recommendation on transitions from the informal to the formal economy. The cooperative movement was represented there as well. That discussion will conclude in June of 2015 and hopefully will produce an ambitious international standard that will guide the actions of governments, employers, workers, cooperatives and others in seeking to provide the benefits of formal employment to those who now toil in the informal economy.

Successful policy and legislative changes require a solid knowledge base to indicate what works and what does not work. As such, I would like to congratulate the International Cooperative Summit and the colleagues in CICOPA on the global report on Cooperatives and Employment. We are delighted that the report was able to use and build on analytical, statistical and country work undertaken by the ILO, including the Global Employment Trends series. We welcome the report’s emphasis on employment policy and statistics, enterprise restructuring through worker cooperatives, the potential of cooperatives to play a role in formalization of workers and units in the informal economy, and the promotion of cooperative entrepreneurship among youth, to mention a few of its important contributions.

Enterprise restructuring through worker cooperatives is a particularly welcome emphasis of the report. The recent crises in a number of regions of the world have led to waves of bankruptcies that have taken their toll on workers, business owners and communities. Workers in various countries have responded to these bankruptcies by pooling their resources, recapitalizing their failing workplaces and operating them using a cooperative model. Recognizing this need and potential, French Government, for example, has recently voted new measures to improve and facilitate employees’ ability to buy their own workplaces in the cooperative mode and keep them in operation. During this Summit the ILO is launching a report on international experiences in enterprise restructuring through worker cooperatives, which you can find at the CICOPA booth in the exhibition hall.

We also appreciate the work in the report on the statistical front, including its clear acknowledgement that we need much more data and research based on solid, quantitative data. As the report points out, it provides more estimates than hard figures because of limitations of available data on cooperatives. We fully concur with the report’s conclusion that the ability to collect and analyse world-level cooperative employment statistics would require changes in public data collection policies.

As ILO is the UN agency responsible for labour statistics, I would like to share with you some recent developments on this front. A new resolution concerning statistics of work, employment and underutilization was adopted by the 19th International Conference of Labour Statisticians held at the ILO in October 2013. The Conference made a breakthrough in recognizing that existing concepts of employment statistics focus too narrowly on work performed for others in exchange for pay. This excludes many types of work and livelihoods, for example, subsistence farmers, unpaid trainees and volunteer work among many others. The Conference broadened the definition of work that should be measured and how data might be collected and the ILO and countries’ statistical agencies are now in the process of beginning to operationalize the new, broader concept of work.

I am happy to report that the same Conference also reaffirmed the importance of obtaining more comprehensive and internationally comparable statistics on cooperatives and adopted a resolution concerning further work on data about cooperatives. A critical next step will be to work in cooperation with interested national statistical offices, with cooperative registrars and with researchers to carry out further work on the measurement of cooperatives, including through administrative registers, establishment or expansion of modules in household surveys and other approaches. We look forward to joining forces with you in undertaking pilot country activities and welcome your suggestions for countries in which to pilot this work.

I hope that the Cooperatives and Employment report will pave the way for further research on the intersection between cooperatives and the creation of more and better jobs, what the ILO calls the Decent Work Agenda. Of particular importance would be reaching a better understanding as to how cooperative enterprises can ensure respect for fundamental principles and rights at work, including the core right of freedom of association, the elimination of forced labour and the worst forms of child labour and combating discrimination in cooperatives themselves and in their suppliers.

Regarding child labour, the ILO estimates that there are around 168 million child labourers in the world, half of whom are engaged in work which is defined as hazardous to their health and safety. This is especially an issue in sectors like agriculture where children play a critical role in many countries and where agricultural cooperatives also have a strong presence. Therefore in the ILO we feel there is an opportunity, and indeed a responsibility, for cooperatives and their associations to look into their supply chains and ensure that their members are well aware and proactive in helping eliminate the worst forms of child labour.

Regarding discrimination, cooperative principles reject gender, social, racial, political and religious discrimination. Cooperatives have a history of contributions to equality and to economic and social empowerment. There are inspiring examples from around the world of marginalized groups using the cooperative business model to support themselves, their households and communities. Considering that 2015 is the year when the UN system will reflect on 20 years of progress since the adoption of the United Nations’ Beijing Declaration on gender equality and women’s empowerment, next year might be a good time for the cooperative movement to review its own progress on gender issues.

Cooperatives have the potential to contribute to gender equality and women’s empowerment through measures that ensure women’s fuller participation in the functioning and governance of their cooperatives, providing opportunities for career advancement for women workers, and enabling access for women members to cooperative resources and services such as education and training, financial services, and child care. The ILO has recently published a brief on the topic, and we are ready to work closely with the cooperative movement in this area.

There is a clear need for more empirical research to fully grasp the role and potential of cooperative enterprises in the world of work. In fact one concrete joint action toward such improved understanding is the organization of a research conference on cooperatives and the world of work, hosted by the International Co-operative Alliance Committee on Cooperative Research (ICA CCR) and the ILO. It will be held on 10-11 November 2015 in Antalya, Turkey right before the ICA Global Conference and General Assembly. The conference will bring together researchers, students, practitioners, advocates, policy makers and representatives of employers’ and workers’ organizations working in areas of cooperative enterprises and social and solidarity economy organizations, as well as labour research and themes related to the world of work.

Dear Friends, Co-operators,

As values-driven, principle-based enterprises, cooperatives are natural and important partners for the ILO: partners in creating good-quality employment, partners in providing social protection for their member-owners and communities, and partners in giving voice and representation to those who have often found themselves excluded from democratic decision-making. At the ILO we stand ready to support the cooperative movement’s efforts toward achieving decent opportunities, livelihoods and employment for your members, your affiliates and your communities. We look forward to building on our 95 years of collaboration with you and to find new, dynamic contemporary ways to support cooperative enterprises in advancing the quantity and quality of jobs for the next decade.

Thank you very much.