Transformation of the Governance of the Farmer Groups Association towards Farmer Corporation in The Shalot Area of Solok Regency, Indonesia

Abstract

The main problem in the development of the shallots business in the Solok Regency production center is the weakness of farmer institutional governance and market access. This article aims to formulate a strategy for the transformation of farmers institutional governance in the direction of the farmers corporate institutional governance. This study was conducted in July-August 2019. The results show that the institutional performance of the farmer groups association is at a medium level measured by the role and business activities, while the cooperative is at a level that is less developed in encouraging the development of farmer institutions towards corporate institutions that ongoing in the shallots agribusiness area. Institutional governance performance of the farmers group association and cooperatives has shown that they have begun to work, but the mechanism of work and coordination has not been effective. Strategies for transformation of institutional governance farmer group assosiation and cooperatives into farmer corporation can be done by adding new structures by participating in integrated agribusiness systems and businesses, expanding market goals and segments, developing new related businesses, and strengthening horizontal corporate institutional governance and horizontally vertical through integrated agribusiness partnership.