About Co-operatives

About Co-operatives

"Co-operatives are more resilient to crisis than other forms of enterprise according to a recent study by the ILO (International Labour Office). .. People are increasingly choosing the co-operative form of enterprise to respond to the new economic realities"ICA (International Co-operative Alliance) message on the 15th UN International Day of Co-operatives 4th July 2009

What is a co-operative?

A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise. The key words in this definition are:

  • autonomous - not controlled by anyone outside the enterprise - including national and local government
  • united voluntarily - no-one can be forced to join
  • jointly-owned - by its members
  • democratically-controlled - one member one vote

Ranging from small-scale to multi-million dollar businesses across the globe, co-operatives employ more than 100 million women and men and have more than 800 million individual members.

Values

Co-operatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, co-operative members believe in the ethical values of honesty, openness, social responsibility and caring for others.

Principles

The co-operative principles are guidelines by which co-operatives put their values into practice.

1st Principle: Voluntary and Open Membership

Co-operatives are voluntary organisations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.

2nd Principle: Democratic Member Control

Co-operatives are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary co-operatives members have equal voting rights (one member, one vote) and co-operatives at other levels are also organised in a democratic manner.

3rd Principle: Member Economic Participation

Members contribute equitably to, and democratically control, the capital of their co-operative. At least part of that capital is usually the common property of the co-operative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their co-operative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the co-operative; and supporting other activities approved by the membership.

4th Principle: Autonomy and Independence

Co-operatives are autonomous, self-help organisations controlled by their members. If they enter to agreements with other organisations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy.

5th Principle: Education, Training and Information

Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their co-operatives. They inform the general public - particularly young people and opinion leaders - about the nature and benefits of co-operation.

6th Principle: Co-operation among Co-operatives

Co-operatives serve their members most effectively and strengthen the co-operative movement by working together through local, national, regional and international structures.

7th Principle: Concern for Community

Co-operatives work for the sustainable development of their communities through policies approved by their members.

Types of co-operative

The co-operative model of enterprise can be applied to any business activity. They exist in traditional economic sectors such as agriculture, fisheries, consumer and financial services, housing, and production (workers' co-operatives). However, co-operative activity now spans a large number of other sectors and activities including car-sharing, child-care, health and social care, funeral, orchestras, schools, sports, tourism, utilities (telephone and internet services, electricity, water, gas), and transport.

Co-operatives are significant economic and social actors

All over the world, millions of people have chosen the co-operative model of business enterprise to enable them to reach their personal and community development goals. Co-operatives create and maintain employment; they are responsible for producing and supplying safe and quality food and services to their members and the communities in which they operate. By putting the Co-operative Principles and ethics in practice they promote solidarity and tolerance, while as 'schools of democracy' they promote the rights of each individual - women and men. Co-operatives are socially conscious responding to the needs of their members whether it is to provide literacy or technical training, or to take action against the HIV/AIDS pandemic. Through their varied activities, co-operatives in many countries are significant social and economic actors in national economies, thus making not only personal development a reality, but contributing to the well-being of entire populations at the national level.