The extended governance of cooperative firms: inter-firm coordination and consistency of values

Abstract

Cooperatives are characterised by mutual-benefit coordination mechanisms aimed at the fulfilment of members' welfare. The paper considers cooperative principles and suggests a layered framework that relates principles, governance choices, and related aims or values. We then consider an extended notion of governance, whereby those who impact on strategic decision-making are not to be searched only within the internal governance bodies, typically the board of directors, the managers or the assembly, but also outside the cooperative, as in the extended network of production relationships in which the organisation is embedded. We then analyse the features of production linkages and their potentials in the accomplishment of cooperative principles.