Billing itself as the first pan-European study to explore social housing company strategies within their rapidly changing economic social and political context, this report is based on a survey of 42 such companies in 12 EU member states and case studies of six companies in six different states. Instead of the usual financial and housing policy focus found in most comparative studies of social housing (Boelhouwer, 1997, Whitehead and Scanlon, 2007) here we have an account that gets closer to the reality of decision making and priority setting by a powerful set of institutions who touch the lives of around 25 million households across Europe and sit between state and market influences.
Unusually within the literature in this field the study draws mainly on strategic management concepts such as mission and values, core activities and diversification, comparative advantage and strategy formation rather than concepts drawn from social policy or economics. Nevertheless we also find some analysis of housing systems and institutional frameworks, welfare states, privatisation and residualisation more common is such studies. Empirically the study has the benefit of a grounding in the work of CECODHAS European Social Housing Observatory in outlining the different national contexts for social housing (informing Annex II) and in mapping the extent and nature of social housing provision (CECODHAS, 2007).
The most striking empirical findings of the survey and case study are that despite sticking to a core task of meeting housing needs of low income households there has been a general tendency across Europe for company activities to widen in scope to include urban regeneration and neighbourhood management and other ‘non-landlord activities’ to fill gaps in a retreating welfare state. A scenario with analogies to the role played by the third sector in earlier liberal welfare settlements before social democratic welfare states expanded. At the same time we have seen a change in the business models of these companies to include more commercial activities and to adopt more strategic management approaches. It is argued that these changes are partly a response to a rapidly changing environment in which there is less public funding and more intense pockets of social need as a result of the retreating state. This chimes with other recent work on drivers for diversification by European social landlords (Brandsen et al 2006).
Because of their long term local anchorage housing organisations have been strongly drawn into strategies to turn around declining areas, both through their asset management and investment activities and though their emerging wider role in promoting local economic revival, and improving local social and community services. While such involvement has led to legitimacy challenges, many housing companies believe that they are uniquely placed and have the organisational capacity and resources to take on this role. However, we might question the extent to which the ability of housing companies to plug gaps in wider welfare provision is contingent on the ways in which the state has withdrawn from housing itself. The huge assets inherited by Dutch housing associations from decades of earlier investment and ten years of house price inflation cannot be compared to the position of housing associations in countries like Ireland where rental policies prevent organisations from accumulating sufficient surpluses to keep their own homes maintained let alone subsidise wider social welfare. Similarly the ability and willingness of housing organisations to take on social tasks is a reflection of internal goals and missions.
Another added value of this study is in clarifying the active agency played by the companies themselves, with mission statements and core tasks being defined in generally social terms rather than market terms (with the exception of the growing emphasis on customer satisfaction). This mirrors earlier work in England (Mullins and Riseborough, 1997,2000) which found that housing association executives valued both social purposes and business efficiency but when forced to choose consistently saw social purposes as more important than business efficiency. Similarly recent Dutch research has found the hybrid model to be central to organisational identities, with social and commercial purposes much poorer differentiators than a division between entrepreneurial prospectors and defenders (Gruis, forthcoming). With the Robin Hood principle deployed to reinvest commercial returns into social purposes these hybrid organisations can always present their commercial activities as a means to an end, funding social investments.
Inevitably the six case studies that illustrate the company profiles generally focus on socially driven activities that embody these organisations’ missions: energy saving in Finland, eco-building in Brescia, historic quarter rehabilitation in Metz, 24 hour drug centre in Wilhelminasingel, a call centre in Bromley and resident artists to refresh declining neighbourhood in Hamburg. However, while private companies might have selected similar examples to illustrate their sense of corporate social responsibility, it still seems reasonable from the evidence presented in this report to believe that there remains a significant distance in terms of mission, activities and outcomes between these social entrepreneurial organisations and private companies that operate in the same field.
In their conclusion the authors call for further work to explore the tension between social and commercial objectives but this will demand new methodologies and perspectives. Earlier writers (e.g. Walker, 2000) had suggested that the adoption of private finance models and new public management would cause housing associations to shift from a people to a property focus. It has also been suggested that commercial drivers could see harder nosed approaches to social housing management itself (for example in relation to access policies and eviction procedures). But as we have seen the Robin Hood principle makes it hard to unmask these tensions, since commercial behaviour can always be justified by social investment of surpluses. Perhaps new evidence will begin to emerge from situations where there is direct competition between social landlords and the private sector and where we may begin to see which business models are adopted and adapted by whom (Mullins and Walker, 2007, Elsinga et al 2007). Social housing remains an intriguing field where further research is required, however Heino, Czischke and Nikolova have done a great service by opening up a strategic management perspective and an organisational level focus to these questions in a variety of European housing market contexts.
Unusually within the literature in this field the study draws mainly on strategic management concepts such as mission and values, core activities and diversification, comparative advantage and strategy formation rather than concepts drawn from social policy or economics. Nevertheless we also find some analysis of housing systems and institutional frameworks, welfare states, privatisation and residualisation more common is such studies. Empirically the study has the benefit of a grounding in the work of CECODHAS European Social Housing Observatory in outlining the different national contexts for social housing (informing Annex II) and in mapping the extent and nature of social housing provision (CECODHAS, 2007).
The most striking empirical findings of the survey and case study are that despite sticking to a core task of meeting housing needs of low income households there has been a general tendency across Europe for company activities to widen in scope to include urban regeneration and neighbourhood management and other ‘non-landlord activities’ to fill gaps in a retreating welfare state. A scenario with analogies to the role played by the third sector in earlier liberal welfare settlements before social democratic welfare states expanded. At the same time we have seen a change in the business models of these companies to include more commercial activities and to adopt more strategic management approaches. It is argued that these changes are partly a response to a rapidly changing environment in which there is less public funding and more intense pockets of social need as a result of the retreating state. This chimes with other recent work on drivers for diversification by European social landlords (Brandsen et al 2006).
Because of their long term local anchorage housing organisations have been strongly drawn into strategies to turn around declining areas, both through their asset management and investment activities and though their emerging wider role in promoting local economic revival, and improving local social and community services. While such involvement has led to legitimacy challenges, many housing companies believe that they are uniquely placed and have the organisational capacity and resources to take on this role. However, we might question the extent to which the ability of housing companies to plug gaps in wider welfare provision is contingent on the ways in which the state has withdrawn from housing itself. The huge assets inherited by Dutch housing associations from decades of earlier investment and ten years of house price inflation cannot be compared to the position of housing associations in countries like Ireland where rental policies prevent organisations from accumulating sufficient surpluses to keep their own homes maintained let alone subsidise wider social welfare. Similarly the ability and willingness of housing organisations to take on social tasks is a reflection of internal goals and missions.
Another added value of this study is in clarifying the active agency played by the companies themselves, with mission statements and core tasks being defined in generally social terms rather than market terms (with the exception of the growing emphasis on customer satisfaction). This mirrors earlier work in England (Mullins and Riseborough, 1997,2000) which found that housing association executives valued both social purposes and business efficiency but when forced to choose consistently saw social purposes as more important than business efficiency. Similarly recent Dutch research has found the hybrid model to be central to organisational identities, with social and commercial purposes much poorer differentiators than a division between entrepreneurial prospectors and defenders (Gruis, forthcoming). With the Robin Hood principle deployed to reinvest commercial returns into social purposes these hybrid organisations can always present their commercial activities as a means to an end, funding social investments.
Inevitably the six case studies that illustrate the company profiles generally focus on socially driven activities that embody these organisations’ missions: energy saving in Finland, eco-building in Brescia, historic quarter rehabilitation in Metz, 24 hour drug centre in Wilhelminasingel, a call centre in Bromley and resident artists to refresh declining neighbourhood in Hamburg. However, while private companies might have selected similar examples to illustrate their sense of corporate social responsibility, it still seems reasonable from the evidence presented in this report to believe that there remains a significant distance in terms of mission, activities and outcomes between these social entrepreneurial organisations and private companies that operate in the same field.
In their conclusion the authors call for further work to explore the tension between social and commercial objectives but this will demand new methodologies and perspectives. Earlier writers (e.g. Walker, 2000) had suggested that the adoption of private finance models and new public management would cause housing associations to shift from a people to a property focus. It has also been suggested that commercial drivers could see harder nosed approaches to social housing management itself (for example in relation to access policies and eviction procedures). But as we have seen the Robin Hood principle makes it hard to unmask these tensions, since commercial behaviour can always be justified by social investment of surpluses. Perhaps new evidence will begin to emerge from situations where there is direct competition between social landlords and the private sector and where we may begin to see which business models are adopted and adapted by whom (Mullins and Walker, 2007, Elsinga et al 2007). Social housing remains an intriguing field where further research is required, however Heino, Czischke and Nikolova have done a great service by opening up a strategic management perspective and an organisational level focus to these questions in a variety of European housing market contexts.
David Mullins, Centre for Urban & Regional Studies, University of Birmingham
References
Boelhouwer, P (1997) Financing the social rented sector I Western Europe. Housing and Urban Policy Studies 13, Delft University Press.
Brandsen T, Farnell R and Cardoso Ribeiro T (2006) Housing Association Diversification in Europe: Profiles, Portfolios and Strategies. Coventry, Rex Group.
CECODHAS, (2007) Housing Europe 2007 Review of Social Co-operative and Public Housing in the 27 EU Member States. Brussels, European Social Housing Observatory.
Elsinga M, Haffner, M, van der Heijden, H and Oxley, M (2007) How competitive is social rental housing in England and the Netherlands. ENHR Conference, Rotterdam.
Gruis, V (2008, forthcoming) Organisational Archetypes for Dutch Housing Associations. Environment and Planning C
Mullins D and Riseborough, M (1997) Changing with the Times. Critical interpretations of the repositioning of housing associations. School of Public Policy Occasional Paper 12. University of Birmingham
Mullins D and Riseborough M (2000) What are housing associations becoming? Final report of Changing with the Times project. Housing Research at CURS Number 7. 102 pp.
Mullins D and Walker JB (2007) Mixed Motives? The impact of direct public funding for private developers on not-for-profit housing networks in England. ENHR Conference, Rotterdam.
Walker R.M (2000) The Changing Management of Social Housing: the Impact of Externalisation and Managerialisation Housing Studies 15.2 281-299
Whitehead, C and Scanlon, K (2007) Social Housing in Europe.
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