Is a Co-op right for you?
Co-operatives exist in every part of the economy, as well as the not-for profit sector and provide many of our essential social services. Co-operatives are member-owned and controlled enterprises are created to meet a common need.
Co-operatives are based around a group of people coming together to meet a common need. The co-operative structure provides a framework for people to pool their resources and share risk and benefits to create a business they own and control together.
What is a Co-operative
There are many ways to describe co-operatives. It is a structure that allows people to pool resources, share-risk, to own and make decisions around important resources in their community. Co-ops are typically created to meet a common need, and to benefit members who share that need. Co-ops also provide a decision making structure that make it easy to organize groups, to share resources, and to promote equality and equity.
The International Co-operative Alliance defines co-operatives as ” 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”. Co-operatives also embody a number of values such as “self-help, self-responsibility, democracy,equality, equity and solidarity, and strive for co-operative members to believe ethical values of honesty, openness, social responsibility and caring for others”.
Co-operatives also follow the 7 Co-operative Principles:
1. 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.
2. 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.
3. 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.
4. Autonomy and Independence
Co-operatives are autonomous, self-help organisations controlled by their members. If they enter into 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.
5. 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.
6. 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.
7. Concern for Community
Co-operatives work for the sustainable development of their communities through policies approved by their members.
What’s the difference?
Co-operatives might be organized a bit differently than other structures, but must compete and be profitable just like any other business. Co-operative businesses are twice as likely to survive compared to conventional businesses, and in the recent global financial crisis survived and later excelled in areas that were most affected.