- The development of co-operatives in Slovenia10-26
- Hybrid tendencies in consumer co-operatives: the case of Sweden10-25
- The Effect of Cooperatives on Quality-Enhancing Innovation04-01
- Do farmers benefit from participating in specialty markets and cooperatives? ——The case of10-11
- RESTRUCTURED AGRICULTURAL COOPERATIVE MARKETING SYSTEM IN UGANDA: STUDY OF THE “TRIPARTIT10-21
- The resilience of co-operative food networks: a case study from Stroud, England10-22
- A ‘member-owned business’approach to the classification of co-operatives and mutuals10-24
- Collective Action for Smallholder Market Access: Evidence and Implications for Africa04-01
- The Future of U.S. Agricultural Cooperatives: A Neo-Institutional Approach02-28
- Production, information costs, and economic organization02-28
At the outbreak of World War I in 1914, the territories of modern Slovenia were aptly named the‘Lands of the Co-operators’, given that the notions of F. W. Raiffeisen and of the international co-operative movement had become eagerly accepted and promoted by Slovene small-scale farmers, craftsmen, intellectuals and populist politicians. It is also noteworthy that some of the decentralised concepts of co-operation, with a reliance on subsidiarity, also had a powerful part to play in the development of Yugoslavia’s unique brand of self-managed socialism and the concept of ‘social-ownership’. Indeed, one of the great ironies of the transitional period in post-1991 Slovenia, is that it would have made more economic sense to have transformed a large number of viable socially-owned enterprises back into co-operatives, than to have taken the complex path of transformation into limited companies.
The territory which constitutes the current state of Slovenia was acquired by the Habsburg dynasty during the period from 1278–1456 and formed part of the Holy Roman Empire. Following the dissolution of the Empire in 1806, the Slovenian territories formed part of the Austrian Empire. On the collapse of the Austro-Hungarian state in 1918, Slovenia was effectively divided between Italy and the new Kingdom of Yugoslavia. From 1945, and the seizure of power in Slovenia by the Communist-led partisan organisation, Slovenia became a constituent republic within the Socialist Federative Republic of Yugoslavia (SFRJ) until the effective dissolution of the federal state in 1991.Following the ten-day war against Yugolavia in June 1991, Slovenia achieved independence and international recognition in January 1992. In 2004 Slovenia was admitted to the European Union, the first and so far only former Yugoslav republic to gain membership.
Situation prior to 1918
In general terms, the most rapid growth of co-operative organisations came in those geographic regions where there were mixed populations of Slovene and German speakers. This was particularly the case in towns and villages on the 'linguistic frontier' like Ljutomer (1871), Ormož (1876) and Celje (1881). A major stimulus was the agricultural depression which swept the Habsburg lands during the 1860s and 1870s. The first Slovenian co-operative was the Society for Assistance to Craftsmen and Artisans in Ljubljana1 which was established in 1856, following the foundation of the first credit union in 1851.2 Primarily the movement began in urban centres which tended to be dominated by the German-Austrian mercantile classes as opposed to Slovene artisans and craftsmen. Essentially, it began as an instance of Slovenes seeking greater economic independence and devolution of powers from the more centralising influence of the German- Austrians. This also coincided with the rise of greater linguistic consciousness in the development of Slovene as a language of literature from being the language of rural peasants.The economic situation in the early part of the twentieth century energised the large number of co-operatives of all types to form a national organisation to conduct the legally obligatory financial audits. Chief among those was the main Catholic co-operative central organisation, Zadruzna zveza v Ljubljani. However, in the Gorica duchy (Trst/Trieste and Videm/Udine) a similar organisation was established (Zveza goriskih gospodarskih zadrug in drustev v Gorici) for the Slovene speakers among the very mixed population of Germans, Italians and Friuls. Major promoters of the co-operative idea in the towns and cities were the brothers Jože and Mihael Vošnjak. Much of their main impetus was in the formation of credit unions and other types of co-operative banks; in 1883, Mihael Vošnjak formed the first co-operative federation – the Union of Slovenian Loan Societies in Celje3 and the first general co-operative union was formed in 1899. As a result by 1914, 12,240 credit cooperatives had been formed in the Slovenian lands of which 65 per cent were for ethnic-Slovenes. The first law on co-operatives was enacted by the Austrian legislature in 1873, and subsequently updated in 1903.4 However, more importantly during the latter two decades of the nineteenth century – inspired by the growth of urban co-operatives – there was a strong development of what we may describe as rural consumer co-operatives, as well as production and basic distributive/marketing cooperatives. A major force in this development was the Catholic Church, given that at this time some 95 per cent of ethnic-Slovenes were Catholic. The latter part of the nineteenth century was also a period of intensive disruption in the rural regions as many of the larger farms, controlled by German-Austrian nobility, suffered economic hardship. The majority of the parish priests in rural areas were ethnic-Slovene and they began to take a leading role in the formation of agricultural co-operatives. Probably the most important articulator of the Slovene rural co-operative movement was Rev. Dr Janez Krek (1865–1917), a Catholic priest from the Ribnica region of Lower Carniola. Whilst undertaking his doctorate at the University of Vienna, he had become greatly influenced by the Christian Social Movement of Dr Karl Lueger.5 He became increasingly concerned at the anti-social effects of capitalism and the anti-religious concept of Marxism. As a result he was instrumental in forming 481 rural co-operative organisations to gain economic freedom for Slovene peasants from the constrictions of the Austrian landed nobility, whilst using the concepts of the German Friedrich Wilhelm Raiffeisen (1818–88) as a model.6
The period of the Kingdom of Yugoslavia 1920–45
One of the main effects of the dismemberment of the Slovene lands, was that 360 ethnic-Slovene owned co-operatives were left in Italy and Austria. Further, the decision of the Belgrade authorities in 1919 to convert forcibly all Austro-Hungarian krone accounts and currency holdings into Yugoslav dinars led to a surge in inflation and a collapse of confidence in the new currency. The market for agricultural products fell to new lows as Slovenes lost the former common market that existed within the empire. However, these economic problems created a new driver for the existing co-operatives and strong growth in the consumer co-operative movement. In particular, the growth of co-operatives with a differing social model to that promoted by the Slovene Peoples' Party (SLS) were exemplified in the formation of ZGZ, a Ljubljana based co-operative federation for social-democrat co-operatives with no specific religious affiliation.
Although the position of the co-operatives was assisted by the formation of a central co-operative bank, they were affected by the world depression in the 1930s. Further, in those areas under Italian control, massive anti-Slovene ethnic and linguistic discrimination resulted in the removal of Slovene academics, business professionals, doctors and teachers to other regions of Italy and their replacement by ethnic-Italians from Sicily and the south. In addition there was a virulent forced programme of Italianisation, especially in the populous coastal littoral and Vipava Valley, headed by radical elements within the Italian Fascist Party. In all parts of the Slovene lands, rural and urban regions were greatly affected by strong levels of emigration to the US. It was not until 1937 - eventually recognising the dire economic situation - the Yugoslav state passed unified co-operative legislation by adopting an Act on Economic Co-operatives. This permitted a group of at least ten physical or legal persons to establish a co-operative for the purpose of mutual economic or social assistance and with profits distributed among the members. By the end of the 1930s the majority of co-operatives in Slovenia were related to horticulture, wood processing, dairy production or viniculture, with supporting credit co-operatives.
The Nazi attack on Slovenia and its dismemberment between Italy, Germany and Hungary resulted in differing treatments of the co-operatives. In the areas under German control, they were assimilated in Austrian networks and the credit co-operatives were incorporated into the Vienna-based Raiffeisenkasse and Volksbank network. In the area under Italian control the Rome authorities set up a co-operatives institute to audit operations but left the co-operative network to its own devices. By November 1944, with a large part of the country under the control of the Slovenian partisan army OF, the effective government, the Slovenian National Liberation Committee (SNOS) created the organisation IZOS (Iniciativni zadruzni odbor Slovenije)， to protect the property of co-operatives during the difficult transitionary period between the withdrawal of the Axis forces and the confusion deciding the line of control between Soviet and British forces along the Alps.
The period of Socialism 1945–91
Effectively the co-operatives returned to the state in which they existed in 1941, but over the following decade a strong restructuring of the entire economic system took place. Thus by 1956, there were only 695 co-operatives left, which had financial reporting lines to the central co-operative agricultural bank (ZKB - Slovenska zadruzna kmetijska banka) and other reporting links to the main republic co-operative organisation, GzzS (main association for Slovenian co-operatives - Glavna zadruzna zveza Slovenije)。 A major component of the initial policy of Tito was a programme of agrarian reform. Initially this followed the Soviet example and was based on collectivisation of large agricultural estates into 'kombinats'. The system did allow the provision of co-operative ownership, but as a lower level of the socialist agrarian system; this did however preserve a number of co-operative organisations, although the credit co-operatives were wound up as part of the socialisation of the banking system.
Unfortunately, the smaller farm co-operatives tended to be as economically unsuccessful7 as the collective farms and following the break with Stalin on 28 June 1948, Tito promoted a new policy to deal with the rural economic structure. The main proponent of a greater devolved system was chief theoretician of the League of Communists of Yugoslavia8, Edvard Kardelj, the Slovene intellectual and Tito's closest confident, who was greatly influenced by Veber's concepts of decentralisation and subsidiarity. Kardelj's view was that any developing system of agriculture must be based on the correct balance of power between the centre and the local system. Kardelj saw the system as practised in the Comecon countries (that is, the USSR and the Eastern European satellites) as being a form of state capitalism, which he wished to avoid in Yugoslavia. His objective was to transfer the state collectives into large scale co-operatives as part of the shift towards 'socialist self-management' and 'social ownership'. Kardelj's own experiences in Slovenia had convinced him that leaving rural peasants to develop their own systems would lead to exploitation by the better-off and more educated peasants, whilst the Soviet system was another element of capitalism, albeit under state control.The result was that by the end of 1956, the Slovenian 695 agrarian co-operatives had approximately 126,000 members (in a country with a population of less than two million)。 Unfortunately, new regulations on agrarian co-operatives, developed between 1958 and 1965 by the government of the Socialist Republic of Slovenia, placed these organisations on the same level as social enterprises. This was due to the development of policies at a federal level which regarded the large, socially-owned agricultural kombinats as the prime movers in agricultural development. Generally, these were not particularly important in Slovenia, which due to its advanced industrial and technology base was mainly focused on forestry, agri-food, viniculture and small-scale agriculture. Thus a policy intended for other republics which had large-scale agri-business developments on former huge estates (for example, as in Vojvodina) was not relevant in Slovenia, where land holdings were normally around eight hectares. Many rural units - particularly wine growing - were operated by part-time farmers who held full-time jobs in local factories and agri-industries.
Additionally, part of the overall policy was to create a high degree of integration between local co-operative unions at the level of 'local self-government'9 which were administratively merged with the local chambers of economy10, while the business co-operative unions were transformed into non-co-operative enterprises. There was a degree of tension regarding the forests, which prior to 1941 had been predominantly in the ownership of the church, religious orders and noble families. Forests were nationalised in 194611 and the farmers' co-operatives had to allow control of forests to special forestry management units.12 Many of the forestry holdings were allocated to small associations of rural farmers and smallholders, some of whom had worked these properties as tenants of the church and the nobility. This was followed by a significant process of merging the larger farm co-operatives and the creation of agro-industry processing plants which were constituted as socially-owned enterprises.13 By 1965, there were only seventy eight agro-co-operatives with 48,713 members in Slovenia.
It became clear by the 1970s, that in Slovenia, whilst the transformation and merger of the larger co-ops into socially-owned enterprises was successful to a degree in the more production focused activities (for example, meat processing, large scale wine production)， the nature of what was predominantly an Alpine agricultural system, controlled by highly conservative and deeply religious small-holders was inimical to the high degree of mechanisation emerging in Slovenia at that time. The larger industries, for example, were highly export oriented - prime examples are Gorenje, the manufacturer of white domestic goods, TAM the producer of buses and lorries and the electronics company Iskra, which produced the iconic telephone. However, this led to a situation of concern regarding the smaller private farmers and their strong relationship with co-operative organisations. In 1969, legislation was introduced which created a special 'savings and credit system' for agricultural co-operatives and forestry association. These organisations were responsible for collecting savings from small productive units as well as granting credits for the modernisation of private farms. The republic government supported these activities of the sections by guaranteeing the savings deposits of producers and small investors and also subsidising interest rates for credits through a soft loan programme。
Situation following independence in 1991
Although the independence of the Slovenian state from the Socialist Federal Republic of Yugoslavia created a general model of moving towards a market-oriented economic system, especially with the transformation of socially-owned enterprises into shareholder-owned companies, the Slovenian model of the free market has proved to be more aligned to the Franco-German social market model.
This has tended to explain why Slovenia has a far lower level of social exclusion and social disparity than other former socialist countries. In general it has minimised the level of socio-economic disruption that has occurred in many so-called transition economies by retaining important industries under state control or majority state shareholder ownership14, by limiting high levels of unemployment and by creating a fairly equitable taxation system that has ensured that probably two-thirds of the inhabitants can be described as broadly middle-income.
The problem has been that the system which has developed has been more inclined towards a careful balance between the centralised state and the private sector; as a result, co-operatives have been squeezed between these two competing demands. In part this is due to the fact that in many parts of the private sector, co-operatives are seen as inherently socialist. Yet this is a serious misapprehension given that the origins of Slovenian co-operative and mutual institutions derives from the nineteenth century nationalist-Catholic-agrarian consensus which then could find no distinctive place either in the highly centralist first Yugoslav state nor indeed in the second decentralised Yugoslav state. At the same time, it has become very evident that in the agri-business sector, agri-tourism, urban tourism, crafts and small scale business sectors, there is a huge demand for mutual organisations to collect, represent and finance micro and small scale entrepreneurs.
Despite this, there was a degree of recognition that the co-operative movement did require a degree of help and support, and this was made manifest by a large number of external EU-funded agencies which engaged with the small business sector through the period from 1992-2004. The Co-operative Act of 199215 has been relatively successful in assisting a transformation process for co-operatives to adapt to the new economy and allowed the restitution of former co-operative property.16Part of the problem is that co-operatives in Slovenia have tended to be regarded as primarily rural organisations, connected to the agri-business environment. Despite the fact that the major impact in the mid-nineteenth century was in the creation of urban co-operatives, the main co-operative union ZZS, which was re-founded in 197217, has tended to gravitate into the food and agriculture industries, whilst retaining a commanding presence as the facilitator of all Slovenian co-operatives.
The current environment
There are in effect at the current time three sectors within the Slovenian co-operative movement:
Agriculture & related agri-business (which encompasses a range of services such as production, marketing and distribution)；Tourism co-operatives (originally deriving from rural tourism developments18 but now including not-for-profit mutual associations in all areas of tourism)；Wholesale & retail co-operatives.
In general, Slovenian co-operatives no longer have that role in the economy, which they held in the 1890-1910 and 1920-35 periods. In the main, their role has been to assist micro and smaller economic actors to gain benefit from pooling resources. A major problem has been that many small businesses have regarded co-operatives and any forms of collective economic entity as a form of socialism; inevitably they have a blindness about the values of entrepreneur associations and mutual organisations which by their collective concept are able to access markets and services which are not available to individual entrepreneurs excepting at great cost.
It is clear that in the mid-1990s, the Slovenian government was keen to see the growth of co-operative organisations - if only to mitigate against the power of the former socially-owned companies as well as the successful private companies. Unfortunately the introduction of a number of new co-operatives in that period failed to provide any substantive benefit; the primary problem was that the state tended to use them as a facility for job creation or for saving firms which had deep structural problems. There is doubt that transferring failing or marginally successful companies to a co-operative model will of itself create corporate or institutional viability.
However, during the last decade the government has taken a fresher and more pragmatic approach to co-operative and mutual models; importantly it has seen them as being part of the competitive economy rather than as some archaic organism to be used as the business model of the last resort.19According to the most recent data of the central co-operative organisation ZZS (Zadruzna Zveza Slovenije) as at the end of 2008, there were eighty co-operatives which were members of the ZZS and 3,283 individual members. Within ZZS, there were four subsidiary companies. Approximately 27 per cent are engaged in agriculture-forest and related activities, 21 per cent in consumer retailing and 21 per cent in business organisation/support. The largest number of co-operatives (by membership and turnover) are to be found in Dolensko belakrajina (SE Slovenia along frontier with Croatia)， Celjska (central region around the city of Celje)， Gorenjska (Alpine region of N Slovenia) and Severne Primorska (Gorica region)。
The March 1992 Act on Co-operatives was a response to the crisis in the Slovenian agricultural sector due to the loss of the Yugoslav market. Slovenia had always been a primary producer of high value processed food products (particularly meat, fruit juices and dairy)， which in general met the quality standards required in neighbouring Austria and Germany, although exports to those markets were only a lesser part of the total. However, the time lapse in re-orienting these high value exports towards EU countries caused a crisis in the agricultural sector between 1990 (when the Serbian embargo on Slovenian products was introduced) and the mid-1990s when trade agreements with EU member states began to become effective.
The agri-business/agro-industrial sector in Slovenia is very much conditioned by the geographic and demographic environment. Apart from the coastal region and the adjoining Vipava Valley which have a Mediterranean nature, the Slovenian agricultural landscape is primarily Alpine or sub-Alpine, interspersed with valley regions. Half of the land territory of the state (10,000 km2) is covered with forest, of the remaining area at least 5,000 km2 is grassland. The effect is that almost three-quarters of the available agricultural land has limited productive capacity due to the terrain (mountains, forest or a karstic landscape which is inhospitable to productive capacity)。 Land ownership in the productive areas tends to be fragmented, one of the reasons why the socialisation of land in the 1946-53 period was a huge failure. There are a large number of small farms, with the majority of owners deriving their main income from non-agricultural activity. This situation was augmented by Tito's policy of moving industrial production from cities into rural areas as a means of providing autonomous industrial production in the event of an attack by the Soviet Union.20 It also retained that nineteenth century Habsburg Empire concept of the industrial worker returning home in the middle of the afternoon to till his vegetables or vines.
According to current estimates the majority of agricultural co-operatives are concerned with animal husbandry (cattle, aquaculture and poultry raising)， followed by cultivation of fields and meadows (vegetables, fruit and cattle feed)。 The co-operatives have a significant share in the production of milk, meat, sugar beet and vegetables. There are a number of successful larger co-operatives active in viticulture and meat processing, such as KZ Metlika, which is not only a production and processing co-operative, but is also active in wholesaling through a national network of sales centres. However, co-operatives are only active in 10 per cent of production of the large milk and dairy product industry.
Agricultural co-operatives include those active in forestry activity, wood and wood derivatives processing. The 74 per cent of forests in Slovenia that are not in public ownership (by the state or ob?ine)， are in private or co-operative ownership - the latter account for about 35 per cent of those engaged in forestry. The largest private owner is the Catholic Archdiocese of Ljubljana21, whose ownership was restored following the process of de-nationalisation。
Co-operative Union of Slovenia
Under the terms of the 1992 co-operatives legislation, the union became a voluntary association of agricultural, agri-business, tourism, food industry and forestry co-operatives at a national level. The main objective of ZZS is to promote and support the interests of its members.
ZZS has had a major impact on the re-invigoration of the co-operative sector; it has been an active participant in the reconstruction of the co-operative bank (Dezelna banka Slovenije)， promoter of a number of rural development tourism co-operatives and the organisation of wholesale and retail operations. However, an attempt to break into the insurance sector with the launch of a Co-operative Insurance Society was doomed to failure given the massive influence of the former socially-owned insurer Zavarovalnica Triglav, which under effective state ownership, has over 40 per cent of the total insurance market.
ZZS is now faced with creating a modern co-operative organisation, with a clear focus on the education and training of member organisations. Co-operative education has been sadly lacking in Slovenia since 1941, and there is a general antipathy towards collective organisations.
Importantly, ZZS is finding that its responsibilities and skills in auditing member co-operatives, a function in which is excelled in the period from 1903-61, is now in a higher level of demand.
Co-operative banks & credit institutions
Although this essay is primarily concerned with consumer-oriented co-operative organisations, the development and growth of the co-operative credit institutions and their current status and relationship to other co-operative enterprises in Slovenia is a matter of significant interest. As will have been seen from the opening comments on the situation in the Slovene crown lands prior to 1918, the relationship between agricultural co-operatives, consumer co-operatives and other mutual organisations was closely connected to the growth of the credit institutions (called rajfajznovke in Slovene as a translation of the German raiffeisen) and the subsequent organisation of central co-operative financial organisations.
The rajfajznovke, as with consumer or production co-operatives, tended to be founded by coalitions of important interests - the Slovene intelligentsia (for example, writers, poets, teachers)， merchants, larger farmers, activists in the SLS and clergy. Mihael Vo?njak, for example, was the instigator of the first Slovene co-operative credit association, Zveza slovenskih posojilnic, in Celje, which was established on 23 January 1883.
A renewed agricultural depression during the early years of the twentieth century was further instrumental in driving the founding of new credit unions and in the organisation of stronger regional groupings of credit co-operatives. The fact that the rajfajznovke alone expanded from 160 in 1903 to 1,005 in 1911, is a testimony to that environment.
Following the integration of Slovenia into the new Yugoslav state, the larger credit unions converted into classical commercial banks particularly those based in the larger cities like Ljubljana, Celje and Maribor. However, these banks were all nationalised during the socialist era with the 1946 law on nationalisation of private assets22 which transferred all banking facilities into the control of the SR governments.23 The authorities created a special branch of Zadruzna in kmetijska banka (ZKB - the agricultural cooperative bank) to take on supervision and monitoring of all co-operative institutions.
It was not until 1954 that the effects of Edvard Kardelj's introduction of social ownership and self-management became more obvious in the credit co-operative sector of Slovenia. In that year the first post-war co-operative saving institution was established in Kranj with the task of collecting savings from the rural population, to provide loans. Within a year, there were twelve co-operative bank saving institutions, and this grew to a system of 105 institutions by December 1960.
However despite this success, wider federal economic and commercial policies were more focused on traditional commercial banks which tended to be under the control of major socially-owned companies. The 1961 Federal Banking Act abolished all co-operative saving banks and their affiliated associations, and transferred their activities into the National Bank of Yugoslavia (NBJ)， the republic central banks and the major commercial banks. In the agricultural sector, these banks tended to be controlled by the large socially-owned agri-business concerns. By 1965 the number of agricultural credit co-operatives in Slovenia had fallen to seventy eight. Yet this situation was untenable, particularly as a result of the food shortage crisis that occurred in the mid-1960s. This led to the reformation of Slovenska zadruzna kmetijska banka (ZKB)， the central bank of the agricultural co-operatives and Zveza hranilno-kreditnih sluzb Slovenije (ZHKS)， an organisation representing rural credit and savings co-operatives. In 1990 steps were initiated by the republic national bank, Banka Slovenije, (which was to become the central bank of the newly independent state) to create a combined financial institution for the co-operative sector, with its main emphasis on agri-business and food chain activities. The majority of the assets and staff of KHKS were transferred to ZKB, as this move was recognised as being of critical importance to the agricultural and agri-industry sector, especially with EU membership in 2004. As a result the banking assets of ZHKS, together with several local Slovenian co-operative savings banks24 were transferred into the new agricultural bank which became Dezelna banka Slovenije to focus on retail banking, small and micro-sized enterprises, farmers co-operatives and the agro-foods sector.
The bank has now had over two decades of successful activity, and is now able to provide a full range of banking services which were not previously allowed to the credit co-operatives and credit institutions. The agricultural co-operatives remain major owners of the bank, along with the Slovenian state pension, disability insurance and restitution funds. Importantly, the bank now has a national network of branches in all major urban centres, which given the relatively small size of Slovenia means that these centres are easily accessible by the rural community.
Impact of co-operatives through the legal structure
It is clear that the 1992 legislation provided a methodology to began to return co-operatives back to their traditional roots in Slovenian society - in other words before the experiments with the different forms of South Slav unification began in 1918. The legislation25 makes clear that the act on co-operatives26 regulates the legal status of co-operatives as a part of the Slovenian enterprise law.27The law defines a co-operative as an organisation with an undefined number of members, whose purpose is to enhance the economic benefits of those members. It is based on voluntarism in terms of accession and exit, an equal level of cooperation, and equality in management. It is thus formatted on the concept of economic and social solidarity, under the raiffeissen principles.
A co-operative may be established by at least three natural or legal persons, who sign an act of formation. Economic solidarity insists that members contribute to the performance of the mutual through their economic stake, but grants all members an equal vote. The purpose of a co-operative is not-for-profit, but as a form of socio-economic assistance, this also implies that the costs of mutuality must be met.
Slovenian co-operatives operate on the basis that the major organ of authority is the assembly (obni zbor)。 This agrees all functioning rules, accounting and auditing, appointment of executive bodies and executive posts and financial transactions. Co-operatives are also required to appoint a president, a supervisory board and an auditor. Where there are more than ten legal or physical persons as members, the co-operative must also appoint an executive/management board.
The Slovenian co-operative movement, whilst developing in its structure from the Austrian and German mutual co-operative organisations, was primarily an expression of the Slovene national character and of the unique features of the Slovenian rural and urban economy in the last half of the nineteenth century. There is also little doubt that it was profoundly influenced by the Christian Social philosophy paramount at that time in the ethnic-Slovene middle classes. In a sense, this sense of ethnic and social solidarity - competing against the spirit of capitalism and socialism - would ensure that after 1945, and the victory of the Titoist partisans, it would find it hard to remain and to endure.
Essentially, it is probably the influence of Edvard Kardelj, and his relentless pursuit of a self-managed, socially-owned, devolved economy, that allowed the Slovenian co-operatives to continue through the Socialist era. Unfortunately, that ability to survive during the period of socialism was undoubtedly the cause of its decline in the immediate period following independence. Any form of collectivism or mutual action was seen as tainted with socialism and further linked to the Yugoslav idea. In a small country which successfully withstood and resisted the first onslaught of the Milo?evi? military machine, the connection to the Titoist past was both suspect and potentially unpatriotic.
As a result, co-operatives became consigned to a rural domain, institutions which assisted small-scale rural farmers to collaborate, but which would not have any significant socio-economic role. Even at the financial sector level, the desire of the financial industry regulator to secure uniformity of structure drove the central co-operative financial organisation into the role of a joint stock bank, albeit that the largest shareholders were agri-food co-operatives.
Sadly, in agri-tourism, environmental, sustainable and heritage tourism, a sector in which Slovenia excels, the ability to use co-operatives as a methodology to bring together individial entrepreneurs has in general been unsuccessful. Despite the fact that Slovenia has been a shining example of the social market - as opposed to the free market - there remains a strong disincentive from small scale entrepreneurs to co-operate meaningfully and profitably.
In a sense, the famed land of the co-operators28, has become in the micro and small enterprise sector, a shining example of un-cooperation. It remains to see whether the current economic crisis may stimulate greater willingness for individuals to co-operate, driven by the same spirit that occurred throughout the period from 1850-1941.
1 F Avsec, Agricultural Co-operatives in the Republic of Slovenia (Geneva, 1994)。
2 R ?uje?, Slovenia: Land of the Cooperators (Ontario, 1984)。
3 F Avsec, Agricultural Co-operatives.
4 European Commission Directive 2003/72/EC 'National Implementation Report on Slovenia', supplementing the Statute for a European Cooperative Society (Bruxelles, 2006)。
5 Fr Krek had a significant influence on the Slovene philosopher Franc Veber, whose ideas about finding a middle way between capitalism and state-centralised socialism had a powerful influence on the Slovene Communist theoretician Edvard Kardelj. Kardelj, who remained Tito's closest confident after the defection of the Montenegrin ?ilas and the expulsion from the party of the Serb Rankovi?, was instrumental in shifting Tito's communism towards a decentralised, autonomous model.
6 Apart from his foundation of the SLS, Fr Krek also founded the Labour Association (Strokovna zveza) which remained the biggest trades union in the Slovenian lands until 1941. As the Habsburg state unravelled in 1917-18, Krek became the main proponent of a Slovene-Croat kingdom within a federated Empire, but he died before his idea was superseded by the Serbian takeover of Slovenia and Croatia in 1919.
7 Avsec, Agricultural Co-operatives in the Republic of Slovenia.
8 ZKJ - Zveza komunistov Jugoslavije; this was the federal party which was primarily concerned with the Federal Secretariats for foreign affairs, defence, ideology, security, overall economic and monetary system management, subject to the overall control of President Tito. Management of co-operatives and organisation of business and economic activity was a primary responsibility of the republican Leagues of Communists and the republic governments.
9 Municipalities or communes which have the Slovene name 'ob?ina'.
10 gospordarska zbornica.
11 Under the Jajce degree of AVNOJ, all lands and property owned by Austrians, Germans or addition persons who collaborated with the occupation forces was confiscated rather than nationalised. This caused significant problems in the 'de-nationalisation' process, which returned forests and other land to the church. Eventually, Slovenia ignored the AVNOJ decisions and property was returned to former Austrian families or their descendants.
12 Slovenia's forests cover 58 per cent of the national territory, placing Slovenia after Sweden and Finland as the most afforested countries in the European Union. Before 1954, the majority of forests were owned by the Catholic Church.
13 'Social-ownership', as formulated by Edvard Kardelj, was an enterprise jointly owned by workers and management, which had the ability to share profits, place profits into reserve or invest profits in other concerns.
14 The Capital Assets Management Agency is a holding agency for the Slovenian state's extensive interests in banks and enterprises. Apart from direct ownership of 40 per cent of the banking equity - through Nova Ljubljanaska banka and Nova Kreditna banka Maribor, the state also has significant indirect holdings (often amounting to 15 per cent of private companies equity) through the pension fund (KAD - Kapitalska dru?ba) and restitution fund (SOD - Slovenije Odskodninska Druzba)。
15 Subsequently amended in 1993, 1994 and 1996.
16 www.zadruzna-zveza.si17 ZZS (Zadru?na zveza Slovenije) was constituted under the Act on Farmers' Associations.
18 This includes farm tourism (accommodation and restaurants) as well as wine and heritage tourism.
19 www.zadruzna-zveza.si20 This was similar to the Swedish-style policy of locating local territorial defence units (TO) in a multitude of decentralised bases. During the ten-day war in 1991 this was a major advantage for the TO as they were able to utilise guerilla-style tactics and bottle up the more heavily armed JNA in their barracks.
21 Ecclesiastical ownership of forests dates back to the medieval times when monastic communities were freuquently founded in forests. In 1946, the majority of church property was seized by the state.
22 Zakon o nacionalizaciji zasebnih gospodarskih podjetij.
23 Socialisti?na republika.
24 Hranilno- kreditna sluzba KG Kocevje, Hranilno-kreditna sluzba Ljutomercan, Hranilnica in posojilnica KGP Kocevske and smaller co-operative credit institutions in Zalec, Domzale, Lendava and Sostanj.
25 www.zadruzna-zveza.si26 Zakon o zadrugah, Official Gazette of the Republic of Slovenia, 13/1992, 7/1993, 22/1994, 35/1996 and 31/2000.
27 European Commission Directive 2003/72/EC 'National Implementation Report on Slovenia', supplementing the Statute for a European Cooperative Society with regard to the involvement of employees (Bruxelles, 2006)。
28 R. ?uje?, Slovenia: Land of the Cooperators (Ontario, 1984)。