Научная статья на тему 'SUSTAINABLE AGRICULTURE POLICY IN SUPPORT OF FARMERS’ COOPERATIVE SYSTEM'

SUSTAINABLE AGRICULTURE POLICY IN SUPPORT OF FARMERS’ COOPERATIVE SYSTEM Текст научной статьи по специальности «Экономика и бизнес»

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Ключевые слова
sustainability / sustainable agriculture / cooperatives / development / održivost / održiva poljoprivreda / zadrugarstvo / razvoj

Аннотация научной статьи по экономике и бизнесу, автор научной работы — Miladin Ševarlić, Vuk Raičević, Rade Glomazić

There is a rapidly expanding body of work which describes what needs to be done by business to help build a sustainable economy. This is generated by government, civil society and by business itself. However, there is a separation between what is expected of the sector, what is being achieved by individual companies and what business says in public about the future. There is also a review of the literature providing key principles of sustainable agriculture. Sustainable agriculture is a way of raising food that is healthy for consumers and animals, does not harm the environment, is humane for workers, respects animals, provides a fair wage to the farmer, and supports and enhances rural communities. Yet movements toward a sustainable agriculture is currently fragmented and without clear direction. This paper aims to explore this relationship between what has been identified as the role of governoment and cooperatives in building a sustainable economy and the current situation. With exploratory research this paper attempted to stimulate debate about contemporary sustainability challengesits legal and policy framework. The final aim of this paper is to deal with the challenge of putting “evidence-based policy-making” and on how private sector can support evidence-based policy action.

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POLITIKA ODRŽIVE POLJOPRIVREDE KAO PODRŠKA SISTEMU ZEMLЈORADNIČKOG ZADRUGARSTVA

Postoji konstantno povećavajući korpus radova koji opisuju aktivnosti koje treba da biznis kompanije preduzmu kako bi se izgradila održiva ekonomija. Ovo se ostvaruje delovanjem vlade, civilnog društva i samih biznis kompanija. Međutim, postoji linija razdvajanja između onoga što se očekuje od sektora, šta treba da urade pojedinačne kompanije i onoga što firme u javnosti izjavljuju kada je budućnost u pitanju. Korištena literatura obuhvata ključne principe za razvoj održive poljoprivrede. Održiva poljoprivreda je način proizvodnje hrane koja je zdrava za potrošače i životinje, ne šteti životnoj sredini i humana je za radnike, poštuje dobrobit životinje, obezbeđuje adekvatnu novčanu dobit poljoprivrednicima, a takođe podržava i pospešuje razvoj ruralnih zajednica. Pa ipak, promene u pravcu razvoja održive poljoprivrede trenutno su sporadične i bez jasnog usmerenja. Ovaj rad ima za cilj da istraži odnos između onoga što je prepoznato kao uloga države i zadruga u procesu izgradnje održive ekonomije i trenutne situacije. Svojim istraživačkim delom, ovaj rad pokušava da podstakne diskusiju o aktuelnim izazovima u smislu pojma održivosti i održivog razvoja i političkog i pravnog okruženja. Krajnji cilj ovog rada jeste da se pozabavi izazovom „donošenja politike bazirane na dokazima“, kao i da istraži načine na koje privatni sektor može da podrži političke aktivnosti bazirane na dokazima.

Текст научной работы на тему «SUSTAINABLE AGRICULTURE POLICY IN SUPPORT OF FARMERS’ COOPERATIVE SYSTEM»

Original scientific paper Economics of Agriculture 4/2012

UDC: 502.131.1:631.115.8

SUSTAINABLE AGRICULTURE POLICY IN SUPPORT OF FARMERS' COOPERATIVE SYSTEM

Miladin Sevarlic,1 Vuk Raicevic,2 Rade Glomazic3 Summary

There is a rapidly expanding body of work which describes what needs to be done by business to help build a sustainable economy. This is generated by government, civil society and by business itself. However, there is a separation between what is expected of the sector, what is being achieved by individual companies and what business says in public about the future. There is also a review ofthe literature providing key principles of sustainable agriculture. Sustainable agriculture is a way of raising food that is healthy for consumers and animals, does not harm the environment, is humane for workers, respects animals, provides a fair wage to the farmer, and supports and enhances rural communities. Yet movements toward a sustainable agriculture is currently fragmented and without clear direction. This paper aims to explore this relationship between what has been identified as the role of governoment and cooperatives in building a sustainable economy and the current situation. With exploratory research this paper attempted to stimulate debate about contemporary sustainability challengesits legal and policy framework. The final aim of this paper is to deal with the challenge of putting "evidence-based policy-making" and on how private sector can support evidence-based policy action.

Key words: sustainability, sustainable agriculture, cooperatives, development JEL: Q12, Q 32, Q 57

1 Full Professor, Ph.D., Institute of Agricultural Economics, Faculty of Agriculture, University of Belgrade, 11080 Belgrade - Zemun, Nemanjina street 6, Serbia, Mobile: +381 63 10 640 25, E-mail: [email protected] www.agrif.bg.ac.rs

2 Assistant Professor, Ph.D., University Business Academy, Faculty of Economics and Engineering Management, 21000 Novi Sad, Cvecarska street 2, Serbia, Phone: +381 21 469 513, E-mail: [email protected]

3 Doctoral student of Political Sciences, M.Sc., European Center for Peace and Development United Nations University for Peace, Belgrade, Serbia, E-mail: [email protected]

Introduction

If businesses do not have complete control over markets in preserving or destroying today and tomorrow's human and natural resources, then they do have a great influence on them. Business therefore has a burgeoning role in creating a sustainable economy. A common definition of 'the economy' is, seemingly, straightforward: 'a system of production, distribution and consumption' (Wordnet, 2010) yet business' impacts on and the motivations within it are most certainly not.

A great transition is required from 'business as usual' to creating a world economy that works towards rather than against a long-term sustainable future. It requires radical mindset and practical changes within a business. For this reason, this paper homes in on the following:

0 How does the way cooperative leader understand the task match what is really needed for sustainable cooperative business and the cooperative sector of the agro-economy?

0 What kind of significant policy changes should be recommended for bridging the gap between the ideal and the reality?

In rising to the challenges that are presented, we aim to review the achievements and the shortfalls of those at the forefront of pro-sustainability business thinking. Our goal is to steer their course a little nearer towards a sustainable economy in the present, for the future and in the future.

Research methodology

This section outlines how we have approached the research required to answer the question posed in this paper. An initial review of literature, including business reporting and academic and practitioner research, was carried out to provide the hermeneutical frameworks to support our research and its subsequent analysis. In particular, this review helped us to envision a sustainable economy and so judge the distance between it and the prevalent global economic model of today.

The 'sustainability economy' is a hot topic. Material published that specifically addresses the role of business in a sustainable future is growing rapidly. If we had been undertaking this research last year at least three of the central documents which have helped to shed light on the topic would not have been available.

The research is based on the "mixed method", using quantitative methods to ensure accurate and confidential data through qualitative ideas and conclusions.

Three approaches have been used for that purpose:

Firstly, the research integrated findings of the "Sustainable Development of The Farmers' Cooperative System in AP Vojvodina" (Sevarlic, Raicevic, Glomazic, 2012) research.

Secondly, by means of interviews, the following pieces of information are collected, especially those about the visions of cooperatives, their strategies on and activities in the promotion and application of sustainability now and in future. Both the primary and the secondary researches are set using, first of all, the following sources: Accenturov '2010 UN Global Compact Survey' (UNGC. 2010), the Economist's research (Economist Intelligence Unit. 2007) and 'McKinsey and Company' (Oppenheim et al. 2007). The sources have been selected to ensure the basic materials for covering socio-economic and ecological sustainability, on the one hand, and to provide a more detailed review of the business strategy and business performance, on the other. On the basis of that, gaining a holistic insight into the subject of the research is enabled.

Thirdly, by means of a comparative analysis of all the mentioned, we have confirmed the assumptions of the socio-economic, legal and ecological sustainability of the farmers' cooperative system in Serbia's agro-economy.

Fourthly the collected primary and secondary data, were analyzed by means of descriptive statistics, the assessment of sustainability in business operations based on the values, strategy and business priorities of farmers' cooperatives in Serbia's agro-economy is made.

On the basis of our research findings we offered policy suggestions that can advance the development of sustainable Agriculture policy development in support of farmers' cooperative system.

Shrinking the gap towards a sustainable economy

In this section, an appropriate definition and a structure directing towards our research are chosen. On the basis of them, we can ask ourselves where the cooperative sector of Serbia's agro-economy is, where it should be and for what reasons cooperative business has an essential role in considering the questions of the sustainability of agro-economy and rural areas.

What does sustainability mean? Today, expressions containing common characteristics, descriptions, relations and, most frequently, temporal determinants are frequently used. Their authors indicate the preservation of human and natural resources, describing their internal relations and the balance between them now and in future (Brundtland, 1987 and CPSL, 2007), "Association of Certified Chartered Accountants" (2010) and 'World Business Council for Sustainable Development" (2010). Out of these definitions, the definition contained in the "Dialogue on Economic Sustainability" in the Cambridge Programme for Sustainability Leadership) is the most appropriate one for our research. The definition contains an explanation which concisely describes the balance necessary for a "good economy": "The basic purpose of a good economy is to constantly enhance the welfare of all people now and in future, respecting rightfulness, nature's restraints, through an active engagement of all participants" (CPSL, 2007). This attitude also calls for a full engagement of the society, including the Government, the economy and citizens' associations.

The given definition can set a task to the human race. In any case, sustainable models, not only definitions, are necessary for setting up a system and direction of an action. When companies are concerned, models such as the Elkington Triple Bottom Line (Elkington, 1997; TBL) and the five types of capital of the Forum for the Future (Porritt, 2009) offer an additional framework for the natural business understanding of their managerial obligations. The TBL is especially suitable for our research because it offers a possibility of conducting an analysis, which means it can be applied to individual companies, activities and sectors, even to the economy as a whole.

Is the current economic model sustainable? Today's predominant economic model does not promote a sustainable future, neither social nor economic, nor the one in the field of the protection of the living environment. The model is still completely focused on the growth of the gross domestic product (GDP). Within this particular thesis, "success" and "progress" are related to the salary and growth achieved through exploiting human and natural resources. Little attention is paid to the ultimate quality. Therefore, the GDP is not an adequate measure for a sustainable economy. It values financial capital first, then the other capital values (Jackson, 2008). It makes us "blind" in relation to negative impacts when a "sound" financial check-up gives a clear account. A bad diagnosis can have fatal consequences. Take this case as an example: looking into the future, if the world financial model achieved permanent growth between the years 201 and 2050, we would need an economy 15 times as big as today's economy. That would be something to go far beyond nature's boundaries. In a funny manner, the New Economics Foundation (New Economics Foundation, 2010) compares the current instability of the commercial welfare with a hamster (human consumption) incessantly eating a quantity of food equal to its weight (the Planet's resources) and, thus, growing quickly. What is obvious is less funny: the wheel can keep revolving; however, the hamster can perish very soon. For that reason, Jackson (Jackson, 2009) warns us that, somehow, we must "separate" the concept of success and prosperity from expanding growth and greed.

Humankind has a universal responsibility to preserve the planet for future generations, distancing from highlighting finances, production and growth, short-term goals, the inequality of resources and other negative aspects. Humankind must act via the government, society and business circles with possibilities at its disposal.

What is the role of business in the development of a sustainable economy?

Starting with the fact that cooperative business, too, should be pro-active in the creation of a sustainable agro-economy and economy, we must ask ourselves the following questions: What function should cooperative business have? What priorities should cooperative business have? What should cooperative business change in its approach to these issues? Which business goals should cooperative business target in responding to these issues?

Going through our literature - the basic researches, it appeared clearly that there are practical definitions of sustainability which should accompany business in general,

and, therefore, cooperative business as well. However, companies in general lack of clear understanding of what "sustainability" means and which activities they should perform to access it.

All business firms should develop new capabilities, and those are numerous. In any case, the Boston Consulting Group (2009) describes a small number of the most significant and the most realistic ones. They include a possibility of acting systemically and through cooperating via internal and external boundaries; a cultural pattern that awards and encourages long-term contemplation; capabilities in the fields of active management, the restructuring process, financial modeling and reporting; and the skills of inclusion in and communication with external decision-makers (BCG, 2009).

The manner for companies to "establish relations" should be supported by trust and good communication. The well-known concept of secrecy should be replaced with trust. The business management and "know-how" must be available to supervision and dialogue. There will be no constant change unless trust is inserted into an organization's culture and system. Business circles should be working on laying trust and transparency into the culture of labor.

Through efficient communication, expectations can be met and progress can be made. Really, the UNGC also indicates that leaders are frequently seen as an educational power of business, which could be taken as true. The consumer and the investor in particular are not always well informed about sustainable alternatives to offer and a possible influence of these alternatives (UNGC, 2010).

A systemic change, especially the development of the system of values which the market functions on, should make up one part of the wish-list of a sustainable economy. Options for this should not completely be based on business circles; however, they can contribute to their examination and application. The examples include the influence of a decision-maker in the process of decision-making (Hart et al. 2009); including some or all "five capitals" in calculation and prediction (Stern, 2007) and (Stiglitz et al., 2009); and examining the reduction factors between the current and future profits (Pearce et al., 1989).

The review of the literature reveals that pro-sustainable business operations are indicative of the needed social, financial, political and culturological changes. They speak a language of enthusiasm and their language is rather pro-active. In any case, a statement made by Jeffry Sachs, advisor with the United Nations on the issues of the Millennium Development Goals, indicates that this is sometimes the case: "One can say that there is a certain lack of seriousness in the process from the very beginning" (Sashs, 2010). Seeing the role of business doing is based on the CSR reports, rules of behavior and will to take part in studies such as this one. Companies prove their progress through common forms of: transparent announcements, engaging different groups, partnering with societies for the improvement and protection of the living environment and communities they are located in, and so on. Companies stick to this faithfully in writing and in practice. For example, trading coal and oil derivatives bears responsibility to the

law, developing the market within legal restraints of pollution (Stern, 2007). Financial institutions also offer stocks and shares, for example: "Goldman Sachs" "Sustainability Index" monitors the added value in "sustainable" joint-stock houses. That enables banks to generate profits with the support of ethical factors (UNCG, 2010). Also, the largest part of business innovations remain based on governmental rules. The majority of pro-sustainable business circles do not provoke them, but use this issue in another manner or change the topic of conversation. They are reactive rather than proactive.

From the review of the literature, we could come to a conclusion that we need to redefine success and prosperity in the conditions of growth which will not be harmful to people and the planet:

• Long-term lasting - Business circles cannot only rely on the pressure imposed by the government or the society because they neither have a power nor long-term lasting to make long-term changes in the economy.

• Combining and integrating capital values - The "Triple Bottom Line" and "Five Capitals" have taught us that financial capital should be connected with yet another capital, or, otherwise, we shall not achieve the right goals when sustainability is concerned. The economic situation today is a painful reminder of what can go wrong if no attention is paid.

• Separation - The definition of success and prosperity must be separated from growth and consumption. We live with limited resources that can be unavailable for future generations.

The legal regulations and socially responsible behavior in Serbia

One of Serbia's key national priorities, whose fulfillment will, for the most part, enable the achievement of the vision of sustainable development, is the country's membership in the EU (Radicevic, N., 2010). In order to achieve its basic strategic-political orientation - the inclusion in the European integration flows, accession to and, then, joining the EU, Serbia must fulfill a series of complex and interrelated conditions formulated by the EU ("The Official Gazette of the Republic of Serbia" No. 57/2008):

• the development of stable institutions guaranteeing democracy, the rule of law and respecting and protecting human rights and the rights of minorities;

• the development of a market economy capable of facing the pressure of the competition inside the EU; and

• the alignment with the EU legal attainments and taking over responsibilities arising from membership.

The adoption of acts of law and decrees for the transfer of the EU law into the Serbian legislation is an obligation of the republican authorities and all activities from within this particular field are performed via the National Program of the Integration of Serbia

into the EU (NPI4). The NPI was adopted in the year 2008, and, from year to year, it has been revised so as to monitor the complying of new regulations adopted by EU in the meantime.

This is very significant from the aspect of the goals of Agenda 215, as well, because by the further complying of the development of strategies with this document, the awareness of the local public regarding issues of sustainable development is raised to a higher level. Programs, policies and local regulations intended for attaining Agenda 21 goals are assessed and modified according to local programs (Local Agenda 21). The strategy undergoes complying with Agenda 21 in order to enable the support of the international financial instruments, which is very important for the economy of Serbia (Stojic Karanovic, 2007).

The application of the legislation adopted in such a manner does not have to be only the central authorities' competence; a significant responsibility can also be demanded from regional and local authorities when the achievement of the EU policy goals is concerned. Therefore, it is important that the province's and local administrative capacities be ensured, as well as the infrastructure and budgetary means necessary for the decentralized implementation of regulations from within the field of the protection of the living environment, sustainable management of natural resources, and adaptation to climate changes (Matic, P., Mirovic, A., 2011). A conclusion can be drawn that an effective implementation of legal regulations does not only depend on the central authorities but also on the authorities at other levels.

While observing Serbia as an EU non-member country, the negative obligation is related to certain provisions of the Agreement of Stabilization and Joining (the SSP agreement) and the Transitional Agreement of Trade (the PTS agreement), which establish the nondiscriminatory treatment of the EU citizens in comparison with the citizens of Serbia (the right of business residence, employment, service provision and so on), or to obligations regarding the protection of the competition, i.e. putting a ban on the state aid, by which the competition is distorted and trade between Serbia and the EU disturbed. So, it is all about the negative obligation of compliance, i.e. the obligation to eliminate all hurdles and restrain from introducing new ones which would infringe certain rights established by the SSP agreement, i.e. the obligations undertaken by the PTS agreement (Jelisavac, S. 2009).

The rules stipulated by the SSP and PTS agreements bind AP Vojvodina's organs, too, as well as all local self-governments in Serbia, so they must not adopt regulations

4 The NPI precisely stipulates how to achieve all the criteria necessary for the state to become the EU member country, ranging from political and economic to the most detailed standards present in the EU in the fields of trade, agriculture, the protection of the living environment, infrastructure and so on.

5 Agenda 21 is the plan of actions, i.e. generally accepted principles of sustainable development agreed upon by the governments of 182 countries at the summit session on The Earth held in Rio de Janeiro in 1992.

nor are they allowed to take measures from within their own or assigned competence which are contrary to those obligations which Serbia has undertaken to fulfill by these international agreements. These organs must give priority to the provisions of the SSP and PTS agreements when implementing the laws, decree-level acts and general acts which they adopt themselves if they are contrary to the above mentioned agreements.

The Serbian Government adopted the National Strategy of Sustainable Development (the NSOR strategy, "The Official Gazette of the Republic of Serbia" No. 57/2008), after which it started preparing the Action Plan (AP) for the implementation of the NSOR. The Action Plan was adopted in 2009 ("The Official Gazette of the Republic of Serbia" No. 22/2009).

Serbia's vision in the next five-year time period (2012-2017, the NSOR strategy, 2008) is an institutionally, economically and infrastructurally developed country, compatible with the EU standards, having such an economy based on knowledge, efficiently exploited natural and created resources, greater efficiency and higher productivity, a preserved living environment, a historical and cultural heritage, where there is a partnership of the public, private and civil sectors, as equal opportunities for all citizens. In tune with the vision, adequate priorities have also been defined in compliance with the NSOR strategy (Nadic, D., Suvakovic, U., 2011).

Aimed at increasing and enhancing socially-responsible business doing in Serbia, and within the Ministry of Labor and Social Policy, together with social partners as associated members, the Government commenced the preparation of the National Strategy (of the Agenda) of the Republic of Serbia on Socially Responsible Business Doing.

The social dialogue should be the basic postulate to start with when solving economic, business and social issues, at the regional level and in all forms of territorial organizing (Olsen, Torun, 2003). It is needed that there are several levels of the social dialogue. The fundamental dialogue is the one conducted within the scope of the work performed by the Social-Economic Council of the Republic of Serbia. Also, social-economic councils at the level of AP Vojvodina and the region must also be established. The network social-economic councils, as the key institutions, should help reach an agreement between the local government, employers and unions, all aimed at increasing the competitiveness of the economy, affirming social rights, increasing standards of the employed, preserving the existing jobs and opening new ones. Through the social dialogue, permanent solutions to further labor engagement of the employed must be generated by creating a necessary social ambience for enterprises (and cooperatives) to operate, the preservation of the existing jobs and opening new ones and the reduction in the number of workers whose subsistence is related to the labor market (Ghai, D., 2002).

The social dialogue must be founded on the MOR conventions on unions' freedoms and the protection of union rights, the rights of organizing and collective negotiations related to the application of the principles of the right of organizing and collective agreement-making (Compston, H., 1997). The essence and spirit of the European

Union's Charter of the worker's fundamental rights and Charter of the fundamental humanitarian rights as well as Revised European Social Charter must be paid respect to. The agreement concluded between the employer and the union must be a social standard and one of the prerequisites for an enterprise's normal functioning (Gernigon, Bernard, Odero, Alberto and Guido, Horacio, 2000).

With an aim to improve socially-responsible business doing in Serbia, it is necessary, inter alia, that attention be paid to innovative development in the fields of industry, technology and services because, putting the aspect of development aside, it is hardly possible to achieve the wanted dynamics of economic progress, or develop democratic, legal, economic, social and cultural institutions representing the foundation which the awareness of a socially-responsible behavior lies on, or upgrade the nomenclature prepared by the Chamber of Commerce and other business associations.

In the field of the development of agriculture and the farmers' cooperative system in the Republic of Serbia, particularly in the context of its harmonization with the European Union's legislation, the Strategy of the Development of Serbia's Agriculture ("The Official Gazette of the Republic of Serbia", no. 78/2005), the Act on Agriculture and Rural Development ("The Official Gazette of the Republic of Serbia", no. 41/2009), the National Program for Agriculture from 2010 to 2013 ("The Official Gazette of the Republic of Serbia", no. 83/2010) and the National Program of Rural Development from 2010 to 2013 ("The Official Gazette of the Republic of Serbia", no. 15/2011) were adopted. It is particularly important that we should highlight the fact that there is a public debate currently performed regarding the proposal for the Strategy of the Development of the Farmers' Cooperative System in the Republic of Serbia, which, apart from the defined vision, mission and goals of the development of the farmers' cooperative system, contains a special chapter elaborating the farmers' cooperative system as the generator of a sustainable economic, social, cultural and ecological development of rural areas (Sevarlic, M.M., Zakic, Zorka, 2011).

Research

In this section of the paper, we account for the results of the research we have conducted in the selected farmers' cooperatives in Serbia's agro-economy, presenting the frameworks of sustainability on the basis of the statements produced by their respective directors and comparing them with what business firms should generally dedicate their efforts to in order to ensure sustainable development.

Once we have defined the core goals of a sustainable economy for the future and recognized the current economic restraints on the way towards it, on the basis of the results of the research (Table 1), we have assessed the fundamental activities carried out by the farmers' cooperatives which can make a contribution to a sustainable agro-economy and economy of AP Vojvodina and the Republic of Serbia.

Research Findings

Having defined the essential objectives of a sustainable economy for the future and identified the current economy gaps in arriving there, we assessed the fundamental actions that could contribute to a good economy. In our research we concentrated on benchmarking selected Cooperatives' current activities with key actions suggested in the "Sustainable Development of The Farmers' Cooperative System in AP Vojvodina" (Sevarlic, Raicevic, Glomazic, 2012) research. Following are the key research outcomes important for policy and decision-making in support of Sustainable Agriculture:

Education - Education is a global issue seen as the fundamental element of the development of a sustainable economy.

The Government - The role played by the government in designing an appropriate framework and polices is predominant for the development of a sustainable farmers' cooperative system as a special ownership sector in the Serbian ago-economy and its entire economy.

Long-term strategic planning - Sustainability of the farmers' cooperatives in AP Vojvodina is closely connected with the long-term planning of long-term investments and believe that it can have an impact on the reputation of cooperatives and the positioning of their commodity brand, which would contribute to an increase in the sustainable production of goods for these reasons.

Rightfulness - When "enterprises" belonging to the cooperative sector - which is the usual terminology for cooperatives in European countries and the world, international declarations provide each one of the "five capitals" with the basis for accession to rightfulness.

Responsibility - Humans, the planet and profits must be balanced with each other. Economic subjects understand that there is an urgent need for an efficient approach to the concept of the Triple Bottom Line.

Motivation - Cooperatives value the existence of clear rules and stimuli in order to include sustainability in their performances.

The outer side - New forms of reporting are significant in the creation of an economic model inclusive of all possible influences on the performance of farmers' cooperatives as a form of social entrepreneurship in rural areas.

Purpose - Sustainability will only be achieved through a common vision of all participants in the society.

Values - Sustainability cannot be the only one theme. Those farmers' cooperatives which stick to the principle of sustainability must include the principle in their respective strategies and activities in order to stimulate the development of an economic model of sustainability.

Measuring - Sustainability indicators are of essential importance for the valuation of business activities and the creation of a valid sustainability index.

Conclusions and policy advice

Several key issues arise from "Sustainable Development of The Farmers' Cooperative System in AP Vojvodina" (Sevarlic, Raicevic, Glomazic, 2012) research that frame the role of local and central governoment and supporting policy. Among the most important are:

Alongside with technological education, it is necessary to raise the education level of members of cooperatives for the social and ecological sustainability of their households and farming estates and their local communities. It is also necessary to raise awareness regarding establishing cooperation for one of the following purposes: joint organization of higher-level processing and production of economically more valuable products, or production of fresh organic products and product branding and placement for commercial purposes. It is also necessary to increase education and information levels regarding international cooperative values and principles. Special attention should be paid to the education of cooperative leaders and managers for financial business, marketing and auditing in cooperatives, as special organizations showing both principles of the organization of capital (business component) and principles of the organization of people/ members (social component). Given the dominance of small and micro- cooperatives, it is necessary for all groups of participants in the work of cooperatives to be educated about the importance of joining smaller cooperatives into bigger associations of cooperatives for purposes of enlargement and thus becoming entitled to benefits regarding the purchase of resources. Associations of cooperatives also trigger increased visibility and recognition of cooperative's products in the market, as well as increased market share in local, regional and national markets. In cases when specialized national cooperatives are formed, we can also speak about the significance of entering international markets.

Countries should provide at least equal economic positions for cooperatives as for other agro-economic participants (farms and companies), which has not been the case in Serbia until the present day. It is also important to deal with the question of unresolved property affairs in the business of cooperatives in Serbia, so that the owners of capital which is still classified as state assets and undistributed cooperation assets could get transformed into cooperatives and cooperative members. Furthermore, members of cooperative associations should become the co-owners of assets belonging to those cooperative associations. It is necessary to harmonize the legislation related to cooperatives with the regulations which exist in the European Union, in order to provide the financial incentives for special programs of further education and training for cooperative managers within the country and abroad and provide additional financial resources for their salaries during the first or first two years after the founding of new cooperatives. What is more, it is necessary to promote credit and saving cooperatives, as well as consumer cooperatives, so as to provide more favorable financial resources for production credit schemes and investments in production. On the other hand, consumer cooperatives are important in terms of avoiding unnecessary intermediaries and improving the economic position both of producers and of consumers. Serbia should strengthen the process of joining cooperative associations from different sectors

into the general cooperative organization/association of Serbia and promote and stimulate their participation in the European association of cooperatives, as well as the International cooperative association.

It is necessary to adopt the already prepared draft strategy for the development of agricultural cooperatives in Serbia and this refers both to cooperative associations and the State. Furthermore, it is necessary to formalize the establishment of specialized cooperatives and their joining into the national cooperative association, since this is the easier and better way to tackle the challenges and problems from the same field or production area, than it is the case with general type of cooperatives. It is also important to enable partnerships between cooperatives and the public, especially for purposes connected with financing the building of regional purchase, processing and distribution centers of agricultural and food products within the cooperative sector.

What is more, we need to provide adequate conditions for consistent cooperative management by members of cooperatives as cooperative owners and regular auditing of cooperatives with the possibility to exclude cooperatives from cooperative associations if they do not accept cooperative auditing. The cooperative association of Serbia, as well as cooperative sectors should to a greater degree use the consulting services of international organizations and institutions, for purposes of solving problems within the cooperative sector and also problems which may appear between cooperatives and the State.

Economic effects of doing business through cooperatives should be the main motivation for all this. There has to be a visible and obvious interest in joining cooperatives, in terms of being attached to a cooperative and participating in the mandatory division of part of the profit among cooperative members at the end of the year, according to certain criteria: the amount of membership fee and value of purchasing resources on the one hand, and value of product placement through cooperatives- on the other hand. All this includes the regular amounts of money put into special funds for cooperative members' social needs and activities helping cooperatives to establish and develop the image of socially responsible organizations which participate in the development of local communities.

Each cooperative should also offer significant support to young cooperative affiliations and women cooperatives, as well as national minorities' cooperatives and special social groups' cooperatives. Furthermore, the biggest contribution in times of economic crisis can be made by cooperatives in terms of keeping the existing and increasing the number of employed workers, managing agricultural and food supplies and purchases without intermediaries for children's homes, retirement centers and homes, childcare and preschool institutions and hospitals.

Cooperatives have always been and will continue to be common enterprises with soul, stimulating economic, social, cultural and ecologically sustainable development of cooperative members' farms, local communities and the state in which those cooperatives exist, operate and develop. By doing business through cooperatives, the influence of grey economy and corruption are significantly reduced, and developmental problems of local communities are dealt with and resolved in a much more efficient way.

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POLITIKA ODRZIVE POLJOPRIVREDE KAO PODRSKA SISTEMU ZEMLJORADNICKOG ZADRUGARSTVA

Miladin Sevarlic,6 Vuk Raicevic,1 Rade Glomazic8 Rezime

Postoji konstantno povecavajuci korpus radova koji opisuju aktivnosti koje treba da biznis kompanije preduzmu kako bi se izgradila odrziva ekonomija. Ovo se ostvaruje delovanjem vlade, civilnog drustva i samih biznis kompanija. Medutim, postoji linija razdvajanja izmedu onoga sto se ocekuje od sektora, sta treba da urade pojedinacne kompanije i onoga sto firme u javnosti izjavljuju kada je buducnost u pitanju. Koristena literatura obuhvata kljucne principe za razvoj odrzive poljoprivrede. Odrziva poljoprivreda je nacin proizvodnje hrane koja je zdrava za potrosace i zivotinje, ne steti zivotnoj sredini i humana je za radnike, postuje dobrobit zivotinje, obezbeduje adekvatnu novcanu dobit poljoprivrednicima, a takode podrzava i pospesuje razvoj ruralnih zajednica. Pa ipak, promene u pravcu razvoja odrzive poljoprivrede trenutno su sporadicne i bez jasnog usmerenja. Ovaj rad ima za cilj da istrazi odnos izmedu onoga sto je prepoznato kao uloga drzave i zadruga u procesu izgradnje odrzive ekonomije i trenutne situacije. Svojim istrazivackim delom, ovaj rad pokusava da podstakne diskusiju o aktuelnim izazovima u smislu pojma odrzivosti i odrzivog razvoja i politickog i pravnog okruzenja. Krajnji cilj ovog rada jeste da se pozabavi izazovom „donosenja politike bazirane na dokazima", kao i da istrazi nacine na koje privatni sektor moze da podrzi politicke aktivnosti bazirane na dokazima.

Kljucne reci: odrzivost, odrziva poljoprivreda, zadrugarstvo, razvoj

6 Redovni profesor, Dr, Institut za agroekonomiju, Poljoprivredm fakultet, Univerzitet u Beogradu, 11080 Beograd - Zemun, Nemanjina 6, Molbini telefon: +381 63 10 640 25, E-mail: milsevar@ eunet.rs www.agrif.bg.ac.rs

7 Docent, Dr, Univerzitet Privredna akademija, Fakultet za ekonomiju i inzinjeriski menadzment, 21000 Novi Sad, Cvecarska 2, Telefon: +381 21 469 513, E-mail: [email protected]

8 Student doktorskih studija, Mr, Evropski centar za mir i razvoj Univerziteta za mir UN, Beograd, E-mail: [email protected]

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