“Co-operatives are a reminder to the international community that it is possible to pursue both economic viability and social responsibility.”
Ban Ki-moon, UN Secretary-General
As a rule, we don’t receive many questions about starting a co-operative but since the United Nations has declared 2012 International Year of Co-operatives, we are excited to provide information on a form of business ownership that is responsible for some of the most successful enterprises is in the world. Did you know that the largest food brand in India is a co-operative? Did you know that co-operatives have a survival rate that is almost twice as high as other businesses after five and 10 years of operations? Did you know that in Northern Ontario co-ops are the most significant employer, after government? (Reference: The Ontario Co-op Association) And that Cooperatives – Desjardins Group is the largest cooperative financial group in Canada, with overall assets of over $173 billion?
So what is a co-operative?
As defined by the International Co-operative Alliance, a co-op 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. Basically it is an organization owned by its members. Co-ops can:
- operate in virtually every business sector
- run as both for-profit and not-for-profit enterprises.
In a co-operative, each member is given one vote ensuring that all members have an equal say in how the business is run, regardless of their investment.
- Co-ops have existed since 1844 when the first formal co-op was formed in Rochdale, England by a group of weavers who were tired of paying high prices for poor food and wanted to better their living conditions. They decided to open their own store and each contributed to a fund to start the operation. Once the fund was large enough, they opened the store as Rochdale Pioneers, selling basic supplies and foodstuffs. The co-op tracked member purchases and divided the profits based on these purchases. Rochdale Pioneers co-op set out the principles co-ops worldwidefollow to this day: Voluntary and open membership
- Democratic member control
- Member economic participation
- Autonomy and independence
- Education, training information
- Co-operation among co-operatives
Concern for Community In Ontario co-ops take on various forms including:
- Consumer Co-ops where members buy in bulk and pass the savings on to members. Mountain Equipment Co-op is an example of a federally incorporated consumer co-op. Karma Food Co-op and Peter Pan Co-op Preschool in Hamilton are also examples of consumer co-ops.
- Housing Co-ops are formed to give members an opportunity to control the buildings in which they live. Examples of housing co-ops would be Bleecker Street in Toronto and Voisins in Ottawa.
- Producer or Marketing Co-ops where all members share in packaging and processing similar products and share in marketing costs. Gay Lea Foods and Quinte Organic Famers are examples.
- Multi-stakholder co-ops allow different types of members such as farmers, customers and workers to different rights of each class based on the co-op’s bylaws.
- Financial Co-ops operate on co-op principles of member ownership but are provincially regulated. Examples include credit unions The Co-operators.