Uncorrected Author Proof Human Systems Management xx (20xx) x–xx DOI 10.3233/HSM-190830 IOS Press 1 Empirical research on the role of internal social capital upon the innovation performance of cooperative firms 1 2 3 Kashosi Gad David * , Wu Yang, Epede Mesumbe Bianca and Gutama Kusse Getele 4 Donlinks School of Economics and Management, University of Science and Technology Beijing, Beijing, China 5 Received 4 December 2019 6 7 Accepted 20 May 2020 8 Abstract. 9 BACKGROUND: Internal social capital in the cooperative firms has emerged in recent years as an important concept for improving innovation performance. 10 11 OBJECTIVE: We explore whether the cohabitation of the different interacting social groups, namely cooperative members, and non-cooperative members, will generate disparate impacts on the circumstance for enhanced innovation. 12 13 METHODOLOGY: A sample of 180 cooperative firms in Ethiopia, with two respondents per firm, consisting of one adherent and one non-adherent member, we reflected on the theory of social capital, and by adopting a relational, cognitive, and structural concept. We conducted Structural Equation Modeling (SEM) through PLS to analyze the importance of each group for innovation performance. 14 15 16 17 RESULTS: Our results suggested that the internal interaction between adherent and non-adherent members of cooperative enterprises positively influences their “innovation performance”. The findings also revealed that non-adherent members were more involved in building innovation than adherent members. 18 19 20 CONCLUSIONS: The results provide empirical evidence that internal social factors are essential assets for effective innovation in cooperatives, and established a new line of research within an empirical perspective. 21 22 Keywords: Innovation performance, internal social capital, cooperative firm, knowledge creation 23 Mr. Kashosi Gad David is a PhD 24 candidate at Don links School of Eco- 25 nomics and Management, University 26 of Science and Technology Beijing. 27 His research interests lie in strategic 28 management, and technology innova- 29 tion and entrepreneurship. 30 31 * Corresponding author: Kashosi Gad David, Research scholar, Donlinks School of Economics and Management, University of Science and Technology Beijing, 30 Xueyuan Road, Haidian Dis- trict, Beijing, 100083 China. Tel.: +86 13020096355; E-mail: pilgrimgad@gmail.com. Professor Yang Wu is a professor at 32 Don links School of Economics and 33 Management, University of Science 34 and Technology Beijing. His research 35 interests are in technology innovation 36 strategy and management; intellectual 37 property strategy and Management, 38 and Enterprise Strategy. 39 40 Miss. Epede Mesumbe Bianca , is 41 a PhD candidate at Don links School 42 of Economics and Management, Uni- 43 versity of Science and Technology 44 Beijing. Her research interests are in 45 business management. 46 47 0167-2533/20/$35.00 © 2020 – IOS Press and the authors. All rights reserved