5.2.3.1 The functioning of participatory governance

Chapter 3 concludes that participatory governance structures outlined in tailor- made legal forms can stimulate the participation of stakeholders in decision- making through certain rights that stakeholder can acquire. These are: (i) ownership of shares and membership rights; (ii) decision and voting rights; (iii) consultation rights; and/or (iv) rights to information. Additionally, such stakeholder rights entail the development of stakeholder participatory mechanisms which may be formal (secured by law or the constitutional documents of a social enterprise, i.e. formal participatory governance) or informal (introduced in the organisational functioning and practice of the social enterprise, i.e. informal participatory governance). They may also be direct (the stakeholder is physically present in the decision-making process, for instance, i.e. direct participatory governance) or indirect (the stakeholder is represented in the decision-making bodies through intermediaries, i.e. indirect participatory governance), and regular (at regular intervals or concerning predefined topics, i.e. regular participatory governance) or ad hoc (whenever an issue emerges, i.e. ad hoc participatory governance).

Chapter 3 also concludes that the examined tailor-made legal forms generally allow, or in certain instances only require (e.g. in Case Study 3), various types of stakeholders, i.e. employees to participate in the ownership of shares, membership, and eventually in the governance of social enterprises. In few occasions, the legal forms exclude the participation of certain types of stakeholders in the social enterprises’ membership and governance (e.g. in Case Studies 2, 3, and 6). Such exclusion concerns different types of stakeholders in the examined case studies, e.g. certain legal persons, persons with mental disabilities, or employees.