Cooperative Principles are the guidelines by which cooperatives put their values into practice. Cooperatives are autonomous associations of people united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise. These principles are used across various types of cooperatives around the world to ensure that their operations align with their foundational values.
The Seven Cooperative Principles§
1. Voluntary and Open Membership§
Cooperatives are open to all individuals willing to accept the responsibilities of membership, without any form of discrimination.
2. Democratic Member Control§
Cooperatives are controlled by their members, who actively participate in setting policies and making decisions. Members have equal voting rights (one member, one vote).
3. Member Economic Participation§
Members contribute equitably to, and democratically control, the capital of their cooperative. This means members allocate surpluses for cooperative development, member benefits, or other activities approved by the membership.
4. Autonomy and Independence§
Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
5. Education, Training, and Information§
Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They also inform the general public about the nature and benefits of cooperation.
6. Cooperation among Cooperatives§
Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.
7. Concern for Community§
Cooperatives work for the sustainable development of their communities through policies approved by their members.
Historical Context§
The origins of the cooperative movement date back to the early 19th century in the United Kingdom, with the formation of cooperative societies aimed at improving the livelihoods of working-class communities. The Rochdale Society of Equitable Pioneers, established in 1844, is often considered the prototype for modern cooperatives and is credited with formulating the first set of cooperative principles, known as the Rochdale Principles.
Types of Cooperatives§
Consumer Cooperatives§
Owned by consumers who buy goods or services from their cooperative.
Worker Cooperatives§
Owned and self-managed by their workers.
Producer Cooperatives§
Owned by producers of commodities or crafts who have joined forces to process and market their products.
Purchasing Cooperatives§
Owned by independent businesses or municipalities to improve their purchasing power.
Housing Cooperatives§
Owned by residents who control the housing unit in which they live.
Special Considerations§
Cooperative principles emphasize democratic governance and equitable distribution of surplus, which make cooperatives distinct from traditional business entities. This model is particularly effective in fostering community development and providing sustainable economic growth.
Examples of Cooperatives in Action§
- Mondragon Corporation in Spain: A federation of worker cooperatives.
- Co-op Food in the UK: A consumer cooperative.
- Land O’Lakes in the USA: An agricultural cooperative.
Applicability§
Cooperative principles are applicable in various sectors, including agriculture, retail, finance, and housing. They promote sustainable development, social inclusion, and economic democracy.
Related Terms§
- Credit Union: A member-owned financial cooperative.
- Mutual Aid Society: An organization formed for mutual benefit among its members.
- Social Enterprise: A business that aims to solve social problems through commercial strategies.
FAQs§
What distinguishes a cooperative from a traditional corporation?
Can cooperatives be profitable?
How does one become a member of a cooperative?
References§
- “ICA Cooperative Identity, Values & Principles.” International Cooperative Alliance.
- Birchall, Johnston. “The International Co-operative Movement.” Manchester University Press, 1997.
- Fairbairn, Brett. “Cooperative Values and Principles: A Practical Path to Transformation.” Cooperative Grocer, 2015.
Summary§
Cooperative principles are the foundation upon which cooperatives are built, guiding their operations and ensuring they remain true to their values. By emphasizing voluntary membership, democratic control, economic participation, autonomy, education, cooperation, and community concern, these principles foster sustainable and equitable development. Understanding and applying these principles can help in building robust cooperative movements that contribute positively to economic and social landscapes.
