By : Firdaus Putra, HC

IN AMERICA, there is an interesting story about Stocksy. A cooperative platform that consolidates photographers. The platform was started by a startup founder, not a photographer. The cooperative works on a multi-stakeholder basis. That means the member base consists of several different groups.At Stocksy, they split it into three. Group A contains the founder and advisor. Group B are employees and group C are photographers.

The number of members of each group is different. So far, group A has only 5 people, group B has 28 people, and at most group C, more than 1,000 people.From a business perspective, this platform is growing rapidly because the royalties distributed are 2-3 times larger than other platforms. Photographers as content creators of course like it.

That has not been added to the dividends they received at the end of the year. And also the privilege of involvement in decision making as a member of the cooperative.So, how do they build a governance where the composition of photographers is bigger than groups A and B? Is there a dictatorship of the majority over other minority groups?

No. As multi-stakeholder cooperatives, they have a different style from the conventional model, which is based on one person, one vote.

Multi-stakeholder

In fact, many businesses can be consolidated with multi-stakeholder cooperatives. The relationship pattern that was originally dichotomous can be consolidated under one cooperative umbrella. For example, between producers and consumers.

Producers are, of course, smaller in number than consumers. If you use conventional models, consumers will always win.Consumers want the best version of the price, cheap or affordable. On the other hand, the producer wants the best price for him in the sense of a high price. The dichotomous relationship can be moderated through a multi-stakeholder model.

Scientists see this potential as transformative rather than transactional. Because, the parties put their aspirations on long-term business sustainability. Not a short-term hit and run action just looking for a margin difference. Sometimes producers do not go directly to consumers. There is still an intermediary between them. For example, the party responsible for the processing of raw materials. This middle party can also be consolidated in the same cooperative with others.

For example, coffee cooperatives are very likely to use that model. First are farmers as producers, then there are also roasteries that process. Until then the coffee is distributed to outlets or shops. The three parties can be united under one roof. The goal is to seek the best, fair and fair value for the parties in a sustainable manner.

Unfortunately, regulations in Indonesia have not allowed such a cooperative model to be formed. We only know cooperatives on the basis of one party: consumers only, producers only, marketers only, and others. So they are actually stuck in their own silos or rooms. What is best for one party, may not necessarily be for the other.

In the case of coffee above, the entrepreneur is usually the middle party. They work to increase the added value of a product. The intervention can be with processing, branding, marketing, and so on.They obtain stock from farmers, then further processed and sold to outlets or shops. We will judge it as a collector who gets more value from the producers.

It’s actually more than that. These entrepreneurs also take risks and spend a lot of resources. From capital, machinery, market access, research and development and other variables.If they form a cooperative, they will certainly not invite producer farmers whose numbers are hundreds or thousands of people. The reason is that they are worried about the logic of voting democracy in cooperatives.

In such cases, multi-stakeholder cooperatives can be a solution. The parties stand as separate groups.Decision making is not based on voting per person, but proportionally based on groups. For example, the Processing Group has 40 percent of the vote, the Producer Group has 40 percent, and the remaining 20 percent is in the Outlet Group.

The principle is that no one has a dominant voice. In that way, natural co-operation or cooperation is possible. If one group has certain aspirations, they must get the support of the other group.That’s where the essence of democracy was born, the process of checks and balances from various interested parties.

Lost potential

Once again, such a practice in Indonesia cannot be accepted because there is no regulation that regulates it. UU no. 25 of 1992 which was refined through the Omnibus Law No. 11 of 2020 has not regulated that either. Whereas abroad, such models and practices have been entrenched since the 1970s. It can be said that we are 30-40 years late compared to other countries.

It is similar to the adage in law, “Het recht hink achter de feiten aan”, which means that the law is always lagging behind reality.Reality allows and requires a collaborative economy model, but existing regulations and institutions have not been able to accommodate it.The adage is actually not to agree, but to remind us that we must perfect what was left behind.

In the absence of norms that regulate it, we lose potential. Various modalities of the parties which when consolidated make it more efficient and multiplied, cannot be activated.These limitations actually have a direct impact on the economic achievements of the community. For example, producer farmers become deprived of additional value from a particular processing chain. They only accept the purchase price of the stock only.

In the digital landscape, which the past five years have been booming, the lost potential is evident. For example, there is one ride-hailing startup whose founder cares about drivers so he wants his company to be cooperative-based. The hope is that the drivers will also own the company. Until then, the notary presented a rule that the rights and obligations of all members are the same. Included in the voting earlier, one person-one vote.

Whereas business development, ideas, applications/technology starts from the founder. Not including the initial investment for operational expenditure. All from the founder’s pocket. If it is a cooperative, with the same rights and obligations, the cooperative actually looks unfair to the founders. So now the founder chooses to establish a company-based company.

Be the drivers not the owner of the company. Here, we again lose potential, namely the loss of dividend opportunities and other benefits for drivers.There is also missing potential from the film sector. In recent years, film cooperatives have developed in Indonesia. The basic idea is how the audience takes part in the production of the film. They became members along with the cast, as well as the rest of the film crew.

Keep in mind the film industry chain is very long. When multi-parties can at least accommodate: the production section, the performers or artists and the audience. In other countries, multi-stakeholder cooperatives can consist of two parties, three or even up to eight parties. The key is to look at the value chain of a business and who is involved in creating value in it.

It also affects the percentage of votes for each party. The party who is the backbone of the business can be given a bigger voice than the others, provided that it is not dominant.

Minister’s discretion

Let’s look at one more case, which happened in 2016/2017. In 2016 the application of transportation modes began to be massive in Indonesia.Pros and cons, including a series of demonstrations and there was also a commotion between ojek base and online ojek, between taxi companies and online taxis. In order not to drag on, the state is here to regulate it.

Then Permenhub No. 32 of 2016 was issued, which legalized online taxi services to operate. The regulation has been revised twice and now we are adhering to Permenhub No. 108 of 2017.Some observers say that this Permenhub is very powerful, because without this ministerial regulation, online taxis are illegal.

Then what about the fate of online motorcycle taxis? The process was longer, until the Constitutional Court issued a decision no. 41/PUU-XVI/2018, which states that motorbikes are not a means of public transportation.

Again, the reality of running fast, the practice of online motorcycle taxis is massive and also provides great economic benefits for the community. The state must not ignore it, so their existence was only regulated in 2019 through the Minister of Transportation Regulation Number 12 of 2019 concerning the Protection of the Safety of Motorcycle Users Used for the Interest of the Community.

The two cases are a form of discretion exercised by the Minister of Transportation. One of the considerations is understanding because public transportation facilities are not yet available massively in Indonesia.On the other hand, the development of the all-digital era has brought various new business models: the sharing economy, collaborative economy, and the like.

Such discretion is common and is also regulated by law, namely Law no. 30 of 2014 concerning Government Administration. That authorized government officials, in their respective sectors, can make discretion. One of the reasons is when the existing laws and regulations do not or have not regulated it.

Back in the days of the 2009 LLAJ Law, there was no business application that would allow private vehicles, whether four-wheeled or two-wheeled, with black plates to be used as transportation. But with digital technology, the platform can orchestrate the use of personal assets. The Minister of Cooperatives can also do the same thing to regulate things that are not in the law. In the field, notaries always say that there are no rules for such a multi-stakeholder model.

But we need to remember, that anything that has no rules is not the same as being prohibited. For cases where there are no stipulations (allow or prohibit), this legal postulate works, “Nullum delictum nulla poena sine praevia lege poenali”. This means that more or less, there is not a single prohibition unless it has been explicitly regulated in the law. With that reasoning, multi-stakeholder cooperatives can be included in it. The status is allowed as long as there are no rules prohibiting it.

In such a space, I hope that the Minister of Cooperatives, within his authority, can issue a Ministerial Regulation which specifically regulates the Status and Institutionalization of Multi-stakeholder Cooperatives in Indonesia. Until then, when the norm is institutionalized, we can incorporate it into the new cooperative law.

This is logically like a regulatory sandbox which aims to absorb and regulate various new initiatives and innovations that develop in the community. I feel it could be a middle ground between the existing deadlock. After all, this innovative tradition has been started by President Joko Widodo with the omnibus law initiative which was previously unknown in the legal tradition in Indonesia.

Minister, we believe that with such discretion we can make a leap in the development of cooperatives: starting from the real sector, digital sector and other strategic sectors. The key is collaborating the parties involved in the business chain so that we have great leverage. In the past, Italy took 40 years before the multi-stakeholder model was officially regulated, it’s good that we all don’t have to wait that long, right? I think this will be a new legacy as a milestone for cooperative changes today and in the future.