Participation and equity shareholding benefits among wheat farmers’ multipurpose cooperatives in Southern Ethiopia

Abstract

The study assessed cooperative members’ participation and its effect on their equity shareholding benefit. This cross-sectional designed study covered 371 stallholders’ wheat producing members from 27 primary cooperatives in three wheat producing districts. Survey questionnaire and key informant interviews were used for data collection. Multiple linear regression analyses were done on six participation variables to identify their relationship with members’ individual equity shareholding benefit. The result showed that, three participation variables, namely years in membership, number of shares, and quantity of wheat produce supplied were identified as significant predictors of benefit (p<0.05) and are therefore, deemed to have influence on the individual equity shareholding of members in their cooperatives. Based on the study findings the study recommended that the regional cooperative agency and affiliated zonal and district public service providing structures should work on how to strengthen those participation aspects having influence on member’s equity shareholding benefit. This can be used as springboard to further encourage members’ participation. Increased equity shareholding in turn, will contribute and eventually address the recurrently reported financial problem of cooperative societies both investment and working capital and their dependence on fragile external sources; on sustainable manner. Cooperative societies should encourage members to supply more quality produce to their cooperatives by giving them tangible benefits in price reward and patronage dividend. The Regional and Federal governments need to create a supportive policy environment to enable farmers’ cooperative societies to own the fertilizer business, including importing and distribution to the village level, which is the main function that these societies are assumed to perform. More importantly, focus should be given to improve members’ participation on the management and decision-making process. This is because, as members based entity, the fundamental organizational characteristics of cooperative, which is members’ ownership, use and control is assumed to be manifested in due process of making decisions that are affecting the affairs of their society.