Formalization of Citizens Activities and Local Governance Actualizing Their Hybridity
Hiroyuki SHIMIZU
Chiba University

1 Introduction
In regional and community studies (RCS), research has been conducted on many typesof organizations and activities involving residents and citizens acting as “local groups(chiiki-shudan)”. Important topics in RCS have included emergencies occurring in new
types of organizations, transformation processes in existing organizations, and thediversification of relationships between organizations in local communities.
RCS primarily targets local organizations such as neighborhood associations(chonaikai or jichikai), residents’ movements (jumin-undo), citizens’ activity groups(shimin-katsudo-dantai), specified nonprofit corporations (called NPO corporations) andconsumers' cooperatives. In this paper, these diverse organizations are considered “third
sector organizations (TSOs).” "Third sector" refers to an aggregate of nonprofit and nongovernmental organizations. TSOs are not regarded as relatively but not completely
distinguished from both governments and corporations. Although the concept of TSOs
has not been commonly used in RCS, considering local groups from broader
interdisciplinary and international viewpoints is expected to be useful.
However, the third sector in Japan is smaller, more ambiguous, and more fragmented
than that in other developed countries. One of the reasons for this is that the corporate
statuses of TSOs have been fractionalized. For instance, the NPO corporation wasestablished by the Act on the Promotion of Specified Nonprofit Activities (the so-called
NPO Law), the social welfare corporation was established by the Social Welfare Act, andthe public interest incorporated association was established by the Civil Law Act.
Historically, in most cases, Japanese nonprofit corporations, except NPO corporations,act as governmental agencies without the participation of citizens. The focus of thispaper is a theoretical discussion on the participation of residents or citizens in various
nonprofit corporations and cooperatives included in TSOs.
This paper also focuses on the formalization of local TSOs in Japan. The phases offormalization include institutionalization, commercialization, and networking bothwithin and beyond the boundaries of local areas, such as in prefectures or municipalities.
Practical issues for local TSOs include how to maintain their properties of communityand voluntarism while advancing formalization. Academic issues corresponding to thesepractical issues are how the framework of RCS, which have focused on mainly informal
and smaller organizations, especially on the scale of neighborhoods, school districts, and1

municipalities, can be reconstructed for analysis of formalized local TSOs.
In this paper, the development of both local TSOs in Japan and approaches to local
TSOs in RCS are reviewed with a focus on intra- and inter-organizational processes.
Next, TSOs are examined as “hybrid organizations” that have intermediate internal
public, market, and community properties, and local governance is examined as acondition that actualizes the hybridity of each TSO.

2 Local communities as base layer of local societies
2.1 Neighborhood associations
One starting point of studies on local TSOs in RCS is the theory of social groups by
Suzuki (1957). In this theory, households, workplace groups, schools, life expansion
groups (such as voluntary associations), and district groups are considered tocharacterize the structure of urban society. Among these groups, households andworkplace groups are regarded as significant. District groups such as neighborhood
associations are distinguished from life expansion groups in that district groups consistof households located within each district whose membership is compulsory.
Various concepts of neighborhood associations have been developed, creating some
controversy. Studies on neighborhood associations have focused on a variety of issues,
including their origins, culture, leadership, organizational structure, and social
functions (Iwasaki et al., 1989; Kurasawa and Akimoto, 1990; Tamano, 1993). One of themain features of the neighborhood association is its multiple functions, which includes
the management of infrastructure for everyday life, the cultivation of mutual friendshipand aid among residents, and the prevention of crimes within districts. Some activities,
such as cooperation in distribution of public information, have been critically regarded
as duplicating the work of municipalities.
At the time of the Hanshin-Awaji Earthquake in 1995, the role of neighborhood
associations in everyday life promoted the coordination of firefighting and rescue
operations. This led to the founding of voluntary disaster prevention organizations(jishu-bosai-soshiki) in each district, which has since been accelerated by local
governments. According to the Fire and Disaster Management Agency, as of April 1, 2010,
a total of 142,759 organizations had been founded in 1,621 of 1,750 municipalities inJapan. About 40 million households are included in these jurisdictions, resulting in an
estimated coverage rate of about 75%. Furthermore, 94.1% of voluntary disasterprevention organizations are founded based on local neighborhood associations.
The White Paper on National Lifestyles published in fiscal 2007 emphasized that the2rate of participation in neighborhood associations has been high. In 2003, 66.2% of allneighborhood associations had household membership rates of more than 90% (Cabinet
Office, 2007). However, those participating in activities and on steering committees are
aging, and thus participation in many neighborhood associations is decreasing.
Viewpoints that attract younger residents and aim to re-invigorate neighborhood
associations through disaster prevention activities are therefore anticipated in the near
future.
Furthermore, studies on neighborhood associations have led to the development ofstudies on residents’ organizations in other countries (Nakata, 2000).
2.2 Community policies“Community” has been an essential concept in the social sciences, especially sociology
and political science. RCS has been informed by sociological theories on community suchas those of Tönnies (1887), Park (1915), and MacIver (1924), and the field of urban
community studies has developed based on community policies implemented from theend of the 1960s in Japan (Matsubara, 1978; Sonoda, 1978; Okuda, 1983).
Community policies started following the report "Community: The Regaining of Our
Humanity in Living Area” by the Ministry of Health, Labour and Welfare (formerly the
Ministry of Welfare) and model projects designed by the Ministry of Internal Affairs andCommunications (formerly the Ministry of Home Affairs). The goals of community
policies were as follows: 1) to set up new districts (community districts) based on
everyday life; 2) to establish community boards in each district; and 3) to constructcommunity centers. Next, community districts were established primarily based on thecatchment areas of public elementary or junior high school districts, which covered abroader area than neighborhood association districts. A few municipalities, such asMusashino City and Meguro Ward, both in Tokyo, established new community boards ineach community district.
The background to the establishment of community policies was that human relations
had become weaker in neighborhoods due to rapid urbanization. Furthermore, newschemes of self-governance by citizens in smaller areas were needed as municipalities
continued to merge. New settings for citizens’ participation were also considered “buffer
circuit” of residents’ movements against problems arising in the community.
In addition, the attempt to set up new community boards meant replacing “oldfashioned” neighborhood associations. In the initial stage of community policy, somestudies assumed a critical tone toward neighborhood associations. Neighborhood
associations were considered traditional organizations that served as “remnants of3

feudalism,” while the new middle class, which was increasing in size, was expected totake active roles in modernizing local communities and constructing a civil society.
However, neighborhood associations gradually came to be evaluated as the practicalcounterparts of community policies as well as the main actors in community developmentin each community district. For instance, neighborhood associations have been crucial
members of community center steering councils.
Recently, re-examinations of community policy have been conducted in RCS (Hirohara,
2011; Yamazaki, 2014). The “great merger of municipalities of the Heisei era,” whichstarted after the enforcement of the Special Mergers Law of 1995 and peaked from 2005
to 2006, was the background to the studies, as was the Revised Local Autonomy Act(Comprehensive Decentralization Law) enacted in 2000, which aimed to promote
decentralization. In order to develop studies on community policy through thecollaboration of interdisciplinary researchers and local government staff, the Japan
Association for Community Policy was therefore founded in 2002.
2.3 Community governance
Neighborhood associations have some features that distinguish them from voluntary
associations, which will be discussed later. The main features of neighborhood
associations are as follows: 1) all households in the district join automatically (asmentioned above); 2) only one group exists in each district; and 3) they exist in every
district. In other words, neighborhood associations monopolize each district (Kurasawa
and Akimoto, 1990). In addition, neighborhood associations form a hierarchy offederations corresponding to each level of governance, such as national, prefectural,municipal, administrative ward and community or school district. These features have ahigh affinity with government, and each neighborhood association is an unmatchedposition to mediate between residents and municipalities.
Each neighborhood association has also had strong linkage with other exclusive
monopolized residents’ groups, including women’s associations (fujin-kai), children’sgroups (kodomo-kai or kodomokai-ikusei-kai), clubs for the elderly (rojin-kurabu), groups
for the healthy development of youth (seishonen-ikusei-kai), parent-teacher associations
for public elementary and junior high schools, and district groups of social welfare
council (chiku-shakyo).
The linkage among exclusive monopolized residents’ groups has fostered a system ofcommunity governance in each district that corresponds to the various needs of its
residents. “Voluntary disaster prevention organizations,” as mentioned above, are also
the result of this linkage. Furthermore, the idea of “disaster prevention governance”

4based on community governance has been examined in studies on disaster-stricken areas,
mainly in Kobe and the Tohoku region (Yoshihara, 2012).
Some urban community studies have been associated with studies on community
welfare (Sonoda, 1999; Okuda and Wada, 2003). The idea of a "disaster prevention
welfare community" was first presented after the Hanshin-Awaji Earthquake in 1995
(Kurata, 1999,) and has been re-evaluated in recent years with an expanded
understanding that for disaster prevention, information on residents in need of care isuseful, and cooperation with welfare institutions for the elderly and handicapped isnecessary.
However, when more specialized and commercialized activities satisfying local needs
are required, organizations that transcend the scope of community governance haveemerged. The voluntary associations discussed in next section have mainly worked
outside the scope of community governance.

3 Viewpoints from studies on voluntary associations
3.1 Attention on voluntary associations
Voluntary associations are equivalent to "life expansion groups," which Suzuki (1957)
insisted were less important for studies on the structure of urban society. However,research on voluntary associations has introduced important analytic viewpoints inrelation to local TSOs. This section reviews studies on voluntary associations before their
institutionalization and commercialization, both of which have been accelerated bylegislation such as the NPO Law enacted in 1998, the Revised Local Autonomy Act (theComprehensive Decentralization Law) enacted in 2000, and the Long-Term Care
Insurance (kaigohoken) System enacted in 2000.
The concept of “voluntary associations” was first applied to newly emerging localgroups (Sato, 1982; Okuda, 1982; Ochi, 1986). Residents’ movements (jumin undo) arosefrom opposition to urban problems such as environmental pollution and livelihoodrelated requirements for infrastructure in the 1960s and 1970s (Matsubara and Nitagai,
1976; Funabashi et al., 1985; Yazawa and Iwasaki, 1989). New activities and mutual aid
groups, such as those mainly founded by housewives that focused on parenting, grew
after the mid-1970s. Citizen businesses (shimin-jigyo) that carried out commercialized
activities with social aims were founded after the 1980s; the activities of consumers'
cooperatives orchestrated by housewives served as a major foundation for these citizen
businesses.
Based on studies by Sato (1982), Ochi (1990), and Watado (1990), Takahashi (2010)5

described the properties of voluntary associations as follows: 1) participatory democracy;2) self-management; 3) voluntarism; 4) post-bureaucratic; 5) multifaceted andintermittent; and 6) many-headed.
In contrast with neighborhood associations, which consisted of households, voluntary
associations consisted of individuals, and their members had aspirations for selfexpression and self-realization such as to realize individual lifestyles.
3.2 Relationship between neighborhood associations and voluntary associations
In the early stage, voluntary associations were regarded as a single issue, while
neighborhood associations were regarded as multifaceted issues. Voluntary associations
were seen as smaller in scale, more informal, and more unstable than neighborhood
associations. Voluntary associations seemed to be dissolved after achieving their goals.
The complementary relationship between neighborhood associations and voluntary
associations such as residents’ movements and citizen activity groups has been an issue
in RCS. This relationship has been regarded as both a condition for the advance of selfgovernance among residents and the construction of urban communities, and arequirement for the sustainability of each voluntary association.
Nakata (1980) insisted that "self-governing bodies of living area (seikatsuchi-jichitai)"
was the basis of autonomy for local governments. He considered that a "self-governing
body of living area" could be formed as a result of interpenetration of neighborhood
associations, which managed local resources, by citizens’ activity groups, which used
local resources such as community centers, and by residents’ movements intended tochange the system. Okuda (1982) examined established neighborhood associations andconcluded that greater formality and greater stability of voluntary associations wereneeded to ensure their sustainability.
The point I want to make here is that the relationship between neighborhood
associations and voluntary associations, including NPO corporations, is not merely ahorizontal network between local TSOs. It is also a vertical network between local groups
in the core of community governance and local groups on the periphery.
The arguments mentioned above consider interpenetration as an inter-organizational
process, but interpenetration is also considered an internal process within eachorganization. The core group conducting residents’ movements inside ordinaryorganizations, such as neighborhood associations, formed new organizations when coregroups intended to accomplish their goals more radically (Matsubara and Nitagai, 1976).
In the spin-off process, ordinary organizations functioned as the infrastructure ofresidents’ movements.

63.3 Viewpoints on the beginning of commercialization of voluntary associations
3.3.1 Viewpoints toward the intra-organizational process
The commercialization process that began to emerge in the 1960s and 1970s led tovoluntary associations starting to exhibit internal organizational infrastructures. The
term “citizens’ business (shimin jigyo)” was coined in the 1980s to express the nature ofvoluntary associations as follows.
First, while consumers' cooperatives as business entities have carried out the tradingof goods, they have also been engaged in social movements such as those to promote thedirect distribution of vegetables from farmers to consumers, to oppose the use ofsynthetic detergents, and to accelerate recycling efforts. Workers’ collectives, which differ
from workers’ cooperatives, developed in the early 1980s based on the activities ofconsumers' cooperatives. Workers’ collectives are business entities, but are owned andgoverned by the workers themselves, that is, the members of each workers’ collective areworkers, managers, and investors at the same time. Workers’ collectives have operated
various businesses, including bakeries and catering services, support services for theelderly and disabled, child care services and recycling programs.
A series of studies (Sato, 1988; 1995; 1996) were conducted on a consumers' cooperative,
the Seikatsu Club Consumers’ Cooperative, and a workers’ collective. The results in theearly work indicated a complementary yet opposing relationship between the propertiesof the business and those of the movements inside voluntary associations (Sato, 1988).
This series is regarded as the first time attention was paid to the intra-organizational
processes of formalized voluntary associations.
3.3.2 Viewpoints toward local governance
Second, voluntary associations also began to commercialize due to relationships withlocal governments through subsidies and contracts. The background to the progress inthese relationships was the notion of “urban management,” which aspires to operatemunicipalities efficiently, similar to companies (Takayose, 1986). Urban management
was expanded against the backdrop of a financial crisis among local governments andthe diversified needs of infrastructures for livelihood and “collective consumption”(Castells, 1978) such as welfare, education, and other services.
In terms of analysis on networks of local groups, the studies above mentioned focusedon the networks led by a central organization. Other perspective is that overlooking thecomposition of different local groups first, and then focusing on relationships between
different municipality sections and local groups through the transfer of finances; this is7referred to as “social process analysis on finance” (Hasumi, 1983; Hasumi et al., 1990;
Nitagai and Hasumi, 1993).
This type of analysis focuses on what kinds of local groups are involved and how
municipality sections distribute their budgets. At the same time, each local group isregarded as being based on different social classes. Various local groups are regarded as
the mediators between municipalities and diverse citizens. The mediation processes are
regarded as including both the municipality that governs diverse citizens and citizens
that benefit from the municipality. This type of analysis attempts to understand how
municipalities organize diverse citizens through the distribution of its budget to various
local groups.
The results of this analysis showed that each municipality section had a relationshipwith specific local groups, and each local group worked under an umbrella organization.
This means that local groups were organized as “urban corporatism” (Nitagai, 1992;
Nitagai and Hasumi, 1993) based on urban management. Local groups related to public
policies involving commerce and industry were more strongly organized, while theorganization of local groups related to livelihoods, including voluntary associations, werestill in progress.
This analysis is positioned toward the viewpoint of local governance, which is
discussed in greater detail later.

4 Progress of institutionalization of voluntary associations
4.1 Impact of the NPO Law
An epochal event for voluntary associations was the Hanshin-Awaji Earthquake in
1995. Volunteers gathered from the entire country and played crucial roles in therestoration of disaster-stricken areas. In Japan, volunteer activities are commonly
carried out after severe disasters, such as the tanker oil-spill accident off the coast of
Fukui in 1997 and the Great East Japan Earthquake in 2011. Studies on volunteer
activities at disaster-affected areas have developed in RCS in tandem with disastersociology (Oyane et al., 2007) and sociology on disaster prevention (Yoshihara, 2012).
The heralded performance of volunteers in 1995 accelerated legislation that enabled
citizens’ activities to acquire corporate status more easily than ever before. In Japan, it
had previously been extremely difficult for citizens’ activity groups to acquire nonprofit
corporate status. Until that time, citizens’ activity groups such as social welfare
corporations could be incorporated in accordance with the Social Welfare Act, as could
public interest incorporated associations (formerly incorporated associations) and public

8interest incorporated foundations (formerly incorporated foundations) in accordancewith Article 34 of the Civil Code enacted in 1896.
The NPO Law came into force in 1998. After that, the number of NPO corporations
increased rapidly. According to the Cabinet Office, the number of NPO corporations
exceeded 10,000 in 2002, 20,000 in 2004, 30,000 in 2006, 40,000 in 2010 and 50,000 in
2014.
After the number of NPO corporations increased, arguments regarding therelationships between neighborhood associations and voluntary associations continued.
Based on collaborations with neighborhood associations, Yamasaki (2003) suggested thatNPO corporations could play a role in residents’ self-governance. At the same time, newviewpoints were added to the argument. NPO corporations are currently regarded as
more sustainable holders of specialist knowledge and skills for specific activities, and arethought to have a positive influence on the activities of neighborhood associations.
4.2 Collaboration measures (kyodo seisaku)
The Revised Local Autonomy Act (Comprehensive Decentralization Law) enacted in2000 with the aim of promoting decentralization also facilitated the founding of NPO
corporations as well as citizens’ activity groups (unincorporated associations). Based on
the Act, local governments initiated collaboration measures (kyodo-seisaku) withresidents, voluntary associations, and other local groups. The collaboration measures
were also based on the policy of “New Public (atrashii-kokyo)” by the central government.
“New Public” means that public services should be provided not only by governments,
but also by various entities, including citizens, local groups, and companies.
These collaboration measures have been carried out based on a number of principles.
In the case of Suginami Ward in Tokyo, the “Suginami Collaboration Promotion
Guidebook” was drawn up in 2004. This guidebook presents the following principles ofcollaboration: 1) equal relationships between the divisions of local government and theircounterparts; 2) disclosure of information concerning the process of collaboration in order
to visualize these relationships; 3) consultation to exchange opinions; 4) understandingof one another’s features; 5) purpose of co-ownership of the project; 6) regard for the
independence (autonomy) of local groups so that they may display their own capacities;7) regard for self-support of local groups; and 8) limited timeframe, that is, the need for
periodic assessment (Suginami Ward, 2013). Some other leading local governments alsopresented their own collaboration principles, such as the “Aichi Rulebook ofCollaboration” by Aichi Prefecture in 2004 and the “Yokohama Code” by Yokohama Cityin 2004.

9

Generally, collaboration measures include the following items: establishment of rulesof collaboration (kyodo jorei) or of citizens’ participation (shimin-sanka jorei);establishment of a collaboration council; establishment of facilities to promote citizens’
activities and collaboration with local governments; and the securing of funds for theestablishment of new organizations and activities.
4.3 Issues regarding collaboration measures
4.3.1 What kinds of local TSOs are counterparts of such collaboration?
One of the issues surrounding collaboration measures is what kinds of local TSOs are
regarded as counterparts of such collaboration. Although opinions on this topic differ,local governments often refer to the White Paper on National Lifestyles from fiscal 2000.
The White Paper identified NPO corporations and citizens’ activity groups(unincorporated associations) as its main targets while overlooking TSOs, including
various public interest incorporations and cooperatives (Cabinet Office, 2002b). Social
welfare corporations, incorporated associations/foundations, and other public interest
incorporations, as well as larger, more specialized, and more commercialized NPO
corporations operating social businesses or providing public services were not viewed as
main counterparts of collaboration by most local governments. At the same time,
whether neighborhood associations are included as targets has also differed among local
governments.
Whichever are eventually decided upon, counterparts of collaboration measures havemade up a smaller part of local TSOs; however, the crucial points of the NPO Law andcollaboration measures are that they have placed citizens’ activities among the pillars of
public services.
4.3.2 What kinds of activities are regarded as “collaboration”?
Another unsettled issue is what kinds of activities are regarded as collaboration?
Obviously, the projects carried out as collaboration measures by local governments canbe regarded as collaboration. Many of the targets in this case have been events under
the auspices of local governments or relatively small projects based primarily on
volunteering. On the other hand, it remains unclear whether undertakings bycommissions through subsidiaries or contracts should be regarded as collaborations ormere outsourcing.
This point is associated in part with two types of collaboration measures (Watado,2006). In the beginning, collaboration measures were regarded as when local
governments established activities planned or carried out by citizens’ groups. In this case,10citizens’ groups are regarded as having peculiar functions that meet the diversified needsof citizens. After introducing market testing (shijoka-tesuto) of local governments basedon the Act of Reform of Public Services by Introducing Competition enacted in 2006,
collaboration began to include outsourcing by local governments. Citizens’ groups are
now in the same category as companies, or in the case of outsourcing, represent cheaper
traders. The former likely relates to “big government,” whereas the latter likely relates
to “small government.”
Some studies have focused on activities carried out as collaboration measures, whileothers have considered the conditions under which TSOs can accept the undertakings oflocal governments. Regarding how local TSOs can be situated as pillars of the local
government, a consideration of the future welfare state as a neo-liberal or social
investment state needs to be re-examined (Giddens, 1998; Wakamori, 2013). In relation
to these points, the studies described in the next section examine the current situationin the UK.
4.4 Viewpoints on local governance4.4.1 Attention to Local Strategic Partnerships (LSPs) and Compacts in the UK
The viewpoints mentioned above are in relation to “local governance” (Iwasaki andYazawa, 2006). The concept of “governance” is regarded as that which is governed byplural entities, including governments, institutions, and various groups. In this paper,“community governance” and “local governance” are clearly distinguished. The former isregarded as governance of separate community districts, while the latter is regarded as
separate local governments, especially municipalities.
In terms of local governance, Local Strategic Partnerships (LSPs), which were
implemented by former Prime Minister Tony Blair's Labour Party in the UK, have been
introduced to Japan. LSPs were set up so that each local government would be inconformance with the Local Government Act of 2000. High-level meetings were held toformulate, examine, and evaluate community strategies for each local government.
Studies on LSPs from the viewpoint of TSOs have been conducted primarily in fields
outside of sociology, such as economics and public administration (Yoshida, 2005;
Tsukamoto, Yanagisawa, and Yamagishi, 2007; Kanagawa, 2008). The significant point
for Japanese TSOs is that local TSOs engage in LSPs as members with other entities
such as local governments, National Health Services (NHS; national management
hospitals), the police, companies, councilors and citizens.
Based on the work of Rhodes (1997), some studies consider LSPs to be ideal “selforganizing networks” or an example of “co-governance”; however, relationships between

11municipalities, NHS, and local TSOs are in fact asymmetrical. In addition, the key
policies of LSPs had to be adjusted in accordance with central government policies.
Furthermore, the central government had to evaluate the achievements of community
strategies.
One of more important points is that in terms of local TSOs, peculiar roles wererecognized in LSPs. The roles of local TSOs were regarded as not only providing services,
but also advocating for disadvantaged areas or groups in each municipality thatcompanies found difficult to approach. In addition, the recognition of TSO roles was
based on a Compact, which is an agreement that confirms the peculiar roles between thevoluntary sector and the government. The Compact was first concluded at the national
level in 1998 as the National Compact, and then at each local government level as Local
Compacts. The impact of these Compacts was that they resulted in the development ofrulebooks or guidebooks for collaboration between local governments and groups inJapan, as mentioned above.
4.4.2 Local governance as a condition under which local TSOs actualize their functions
However, this situation was greatly transformed after a change in government in 2010
in the UK. Local governments are not charged with establishing LSPs. The participationof citizens as evaluators of public services has advanced based on personalization, while
the roles of participants in the decision-making process of local governments have
weakened. The focus of service evaluation among local TSOs, as well as among otherservice providers such as companies, shifted to objects from the viewpoint of quality,
efficiency, and effectiveness.
With this shift in policy, local TSOs lost the ability to perform their advocacy functions(Shimizu, 2014b). At the same time, TSOs came to be recognized as merely service
providers in same category as companies. This seems to promote a polarization of thethird sector into large-scale organizations with higher competitive power and small
volunteer organizations that do not require public funds through commissioning.
Based on this new scheme of decision-making in the UK, the state of local governancehas dramatically changed. The experience in the UK demonstrates that the actual stateof local governance is an important condition in regard to local TSOs and what kind offunctions they can actualize, and if not clearly revealed, will otherwise remain latent.

5 Progress of commercialization of voluntary associations
5.1 Progress of commercialization of TSOs in the welfare sector

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The Long-Term Care Insurance (LTCI; kaigohoken) System started in 2000 in Japan.
It has had a marked influence, especially on voluntary associations involved in mutual
aid and social services for the elderly based on subsidies or contracts with local
governments that would otherwise have no public funding. The quasi-market offered an
unprecedented revenue source to voluntary associations, most of which were NPO
corporations. Some of the voluntary associations providing LTCI services subsequently
grew in scale and accelerated their commercialization activities (Tanaka et al., 2003;
Suda, 2011).
Adachi (2008) gave a critical assessment of voluntary associations providing LTCI
services known as “Care NPOs.” In his paper, advocacy was regarded as a significant
function for nonprofit organizations based on the functional analysis on voluntary
associations by Kramer (1981) and Salamom (1999). “Care NPOs” are regarded asvoluntary associations that lack advocacy functions and networks for building welfare
communities even though they are overwhelmed with the provision of LTCI services andadministrative work. “Welfare NPOs” are thus presented as voluntary associations thathave overcome the problems of “Care NPOs”; the American Association of Retired
Persons (AARP) is considered an ideal “Welfare NPO” model. The AARP is described asa nonprofit organization managed by professionals. The roles of professionals in the
AARP include developing new services to meet the needs of members and advocating
welfare policies for the elderly. On the other hand, the roles of members are mainly tochoose which services whey wish to use.
From another angle, voluntary associations providing LTCI services are broadly
divided into two categories. The first is groups that have devoted themselves to LTCI
services. Some of them have switched all of their former activities to LTCI services, whileothers were newly founded specifically to provide LTCI services. The second is groups
that have worked outside of LTCI services, such as in mutual aid, while providing LTCI
services. Activities outside of LTCI services are regarded as significant work actualizing
the properties of community and voluntarism while not expecting profit.
5.2 Hybrid organizations and social enterprises
5.2.1 Introduction of viewpoints of hybrid organizations
The notion of “hybrid organizations” is helpful to consider as an intra-organizational
process, as mentioned above. Intra-organizational processes refer to relationships
between several organizational functions, such as advocacy and service provision(Adachi, 2008), and between activities such as working outside of and providing LTCI
services. These relationships can be both complementary and opposing (Matsubara and13

Nitagai, 1976; Sato, 1988).
The notion of “hybrid organizations” has been investigated in studies of the EMES
(Emergence of Social Enterprises in Europe) Network, which is a study group on TSOs
composed of researchers in Europe (Evers and Laville, 2004). The EMES study groupconsiders the third sector as an intermediary sphere between three others: the publicsphere, which is formal and nonprofit; the market sphere, which is formal and for profit;
and the community sphere, which is informal and nonprofit. TSOs are considered theagents of the intermediary sphere. In other words, this viewpoint regards TSOs as hybridorganizations with public, market, and community properties.
On the basis of considering TSOs as hybrid organizations, we can cease from regarding
TSOs simply as agents of community. At the same time, we can also cease from regarding
TSOs contracting with local governments as simply agents of these local governments,
and also from regarding commercialized TSOs, such as those providing LTCI services,
as isomorphic with companies.
5.2.2 Development of studies on social enterprises
In relation to the recognition of hybrid organizations, studies have carried out on“social enterprises” (Pestoff, 1998; Borzaga and Defourny, 2001). In terms of studies onsocial enterprises in Japan, Fujii insisted on the presence of two streams. Viewpoints
from the European stream are based on the social economy and social exclusion, while
viewpoints from the American stream include companies paying attention to social or
ecological issues and corporate social responsibility (Fujii, Harada, and Otaka, 2013).
In some countries, such as Italy, the UK, and South Korea, social enterprises areprescribed by legislation, but actually, other organizations are also regarded as social
enterprises. How to define social enterprises and how they can be distinguishedtheoretically from hybrid TSOs remain unclear. In third sector studies, social enterprises
are regarded as having both social and economic properties. Social properties include
social aims, activities for/by the disadvantaged, and dealing with social exclusion. On theother hand, economic properties include efficient management, business innovation, andthe promotion of entrepreneurship. Regarding corporate governance, some studies stressthe role of the social entrepreneur, who plays a variety of roles, including a manager, a
networker, and social movement activist, while other studies stress social ownership, in
which diverse stakeholders participate in the decision-making processes of anorganization.
Studies on cooperatives have actively conducted research on social enterprises inJapan (Nakagawa et al., 2008). Nakagawa (2005) considered social enterprises as

14

community cooperatives and community businesses that developed from workers'
cooperatives in the UK. Research on social cooperatives regarded as social enterprises in
Italy were of practical concern from the standpoint of Japanese workers' and consumers'
cooperatives. Furthermore, Tanaka (2004) conducted research on social cooperatives in
Italy from the sociological viewpoint of creating a social economy.
In recent years, studies focusing on Work Integration Social Enterprises (WISE),
which promote employment of disadvantaged groups such as unemployed youth, persons
with disabilities, and the poor, have been conducted (Yonezawa, 2011; Fujii, Harada, andOtaka, 2013). The workers’ collective is also regarded as a type of WISE. This concept
enables an autonomous working style that provides an alternative to male-dominatedlabor and unpaid work, primarily for housewives. The worker’s collective, along withother cooperatives, has been considered a pillar of civil society and the social economy(Sato, 1996).
However, the running of workers’ collectives has been difficult. One of the reasons forthis is that no specific legislation currently provides workers’ collectives with a legal
status. Therefore, specific legislation such as the Social Enterprise Development Law inSouth Korea needs to be formulated in order to develop workers’ collectives as a social
enterprise, which has been suggested by researchers and the Worker’s Collective
Network Japan, the nationwide federation of workers’ collective (Fujii et al., 2013).
5.2.3 Viewpoint on conditions actualizing the “hybridity” of social enterprises and TSOs
Based on studies on social enterprises, Fujii et al. (2013) emphasized the “hybridity”
of organizations as being based on pluralism as follows: 1) the presence of pluralistic
aims; 2) the participation of various interest groups (multi-stakeholders) in organization
activities regarding the decision-making process; and 3) connections with a pluralistic
economy. They considered the positive mediation of plural properties that actualize
hybrid organization against isomorphism with for-profit organizations or governments
asorganizational

conditions.

Positive

mediation

management

andsocialentrepreneurship are necessary in order to promote various forms of participation in theorganization and develop human capital for that participation.
Another focal point is the institutional conditions required for commissioning between
local governments and TSOs. Harada et al. (2010) insisted on the importance ofinstitutions that evaluate not only the economic value of activities, but also their social
value. From the viewpoint of public administration studies, Ushiro (2009) criticized somediscussions that stressed the principle of equality between local governments and localgroups in collaboration measures. He regarded these discussions as idealistic, and15

insisted that commissioning must be based on compatibility and accountability in orderto receive public funds and ensure the autonomy of “NPOs.” He also insisted on theclarification of basic rules regarding the relationships between local governments and“NPOs,” similar to the Compact in the UK.
5.3 Intermediary organizations as a condition for actualizing the hybridity of local TSOs
5.3.1 Conditions for the acceptance of “entrepreneurship” in local TSOs
Shimizu (2010, 2014b) considered the emergent process of social enterprises as theacceptance of norms of entrepreneurship by voluntary organizations in the UK. The stateof acceptance was different among voluntary associations. For instance, a local group of
Age UK (formerly Age Concern) that was providing public services based oncommissioning with the municipality and other public institutions, unwillingly accepted
their norms and was therefore forced to manage their organization and operations more
efficiency. In this case, the local Age UK group had to become a “social enterprise” inorder to undertake public services.
On the other hand, the TSOs holding assets such as land and buildings were split. The
Bromley by Bow Community Centre accepted the norms and made efficient use of theirbuildings and land for a new business. Nishiyama and Nishiyama (2008) studied theactivities of urban design and viewed TSOs such as development trusts as social
enterprises. Another type, settlement trusts, refused to accept the norms and has since
worked as usual as a traditional voluntary organization.
Shimizu (2014b) focused on medium-scale TSOs equipped with increased hybridity.
They not only provide services, but also advocate and create networks in local society.
The conditions regarding whether the properties of the community can be revealed orwill remain latent is related to not only intra-organizational, but also interorganizational processes. Intermediary organizations assume roles such as lobbying,publicity, and valuating the social impact of activities, that are difficult for frontline
organizations to put into practice. The activities of intermediary organizations are
regarded as one of the key conditions for maintaining and actualizing the properties of
the community in frontline TSOs.
5.3.2 Intermediary organizations and local governanceIntermediary organizations are classified as follows into three different types based on
the work of Burridge (1990, cited in Osborne, 1999): 1) the generalist type, which
provides general services to all types of TSOs; 2) the specialist type, which provides
general services to specific types of TSOs; and 3) the functional type, which provides

16

specific services to all types of TSOs; volunteer centers are included in this type.
Studies on intermediary organizations have also been conducted in Japan (Cabinet
Office, 2002a; Yoshida, 2004; Tsukamoto and Nishimura, 2008; Japan NPO Center, 2013)
however, most of these studies have focused on the generalist type of intermediaryorganizations. Many have operated facilities such as “NPO centers” or “Citizens’ activity
centers” in each local government. Facilities have been established by local governments
as a part of the collaboration measures mentioned above. On the other hand, somestudies, such as that by Yoshida (2004), have focused on specialist intermediaryorganizations in Japan. However, the degree of the specificity is different; for instance,
the Council of Social Welfare consists of organizations working on various welfare
activities, but other groups, such as Meals on Wheels Japan and the National Networkof Services for Difficulty in Transit, are centered on a specific service (Approved Specified
Nonprofit Corporation National Council for Citizens’ Welfare Organizations, 2014;
Shimizu, 2015a).
Commercialized hybrid organizations have been established based on citizens’
voluntary actions, but in most cases, their advocacy functions have worked throughneither community governance nor collaboration measures. Community governance hascorresponded to general issues within districts, and the target activities of collaboration
measures have also related to general issues. Some of the advanced hybrid organizations
have supported establishing newer organizations that deliver the same kinds of service,while others have supported the establishment of specialist intermediary organizations(Yoshida, 2004).
The Approved Specified Nonprofit Corporation National Council for Citizen's Welfare
Organizations (Shiminfukushidantai-zenkokukyogikai) (2014) conducted research on
the different types of intermediary organizations. The following functions were
examined: 1) establishment and management of an organization; 2) service provision,
expansion, and quality assurance; 3) acquisition of funds and goods; 4) network building;and 5) policy proposals and advocacy of each type of intermediary organizations.
Most of the generalist organizations work at the municipal level, and many of them
maintain good relationships with local governments, especially the divisions forestablishing citizen autonomy and networks with other local groups; however, theiradvocacy functions remain limited. Specialist organizations maintain good relationships
with national, prefectural, and municipal governments, but work beyond municipalities
and prefectures. Furthermore, they fulfill the function of advocacy mainly at the national
and prefectural levels.
These findings suggest that specialist intermediary organizations, which consist of17

voluntary associations, including hybrid TSOs, can intervene in local or community
governance from outside of the local society or community district.

6 Conclusions
This paper considered three layers of local TSOs based on RCS. The first layer
constructs community governance with neighborhood associations as the central figurein each district. Community governance is regarded as one of the general types ofgovernance that is multifunctional, but without specialized or commercialized activities.
The second layer mainly consists of local groups of counterparts in collaboration
measures. These are mainly NPO corporations, but their activities are not highly
commercialized. The third layer consists of groups more highly commercialized than thefirst two. The groups in the third layer have been developed outside the scope of general
governance, such as community and local governance.
Local groups in the third layer are regarded as having higher hybridity andintermediate public, entrepreneurial, and community properties. One of most important
intra-organizational conditions of intermediation is management, which has multiple
purposes and establishes boundaries between business and community activities. At thesame time, networks are regarded as important conditions, and each property can be
actualized as an activity or function if it meets the appropriate conditions, such as a stateof local governance.
Intermediary organizations have important roles in terms of local governance for localgroups. In addition to mediation, separation between governments and frontline
organizations is an important condition for maintaining the hybridity of local TSOs.
Local TSOs make it possible to obtain benefits from local governments by this mediation;
however, they also make it possible to maintain the properties of communities by thisseparation. A division between intermediary organizations that advocate and lobby andfront-line organizations that carry out activities based on the participation of citizens isnecessary.
Although specialist intermediary organizations could potentially intervene inestablished general governance such as community and local governance, only a few
studies have been conducted on these types of organizations in Japan. The intervention
process corresponds to the concept of “sub-politics,” which has been suggested as being
able to “politicize the politics” (Beck, 1999) based on the necessities of life. Exactly how
the formalization of specific activities can meet these needs and impact existing
community and local governance is a focal point in the study of local TSOs in RCS.

18

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