Governance in Cooperatives: Application in an Agricultural Cooperative

Abstract

This study sought to understand the available governance structures and to identify the best in light of the reality lived by the agricultural cooperative researched. Thus, the process was done through descriptive, bibliographic, documentary and case study research, observing the actual practices of cooperative governance versus what studies on the subject advocate. The results demonstrate that the cooperative has a minimal governance structure, as provided by law, moving towards the traditional extended model with the separation of ownership and control. It has values that guide its sustainable growth and seeks to act in accordance with the governance and cooperative principles to ensure legitimacy. From triangulation of the theoretical evidences on governance and empirical observation in the agricultural cooperative, we made suggestions for improvements in the governance structure: (a) maintain good relations for joint action between the existing administrative bodies; (b) have professional managers on the executive board; (c) adopt other mechanisms of internal governance controls in the form of certain committees and internal rules; (d) hiring experts for councils and committees, where appropriate; (e) investment in continuing education for board members and other administrative bodies; and, finally, (f) more rigorous compliance practices. In summary, our proposal contributes to the sustainable development and legitimacy of the cooperative with its stakeholders, as well as other agricultural cooperatives given the similarity of characteristics. JEL Classification Codes: O16, J54, N56.

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