Quick Quiz: Can You Name the Seven Cooperative Principles? Why are they so important?
The seven cooperative principles are what sets a cooperative business apart from other businesses. Many of us ensconced in the day-to-day work it takes to get our community-owned grocery store here live these principles, but we need to ensure that all of you, our readership, have a solid grasp of this unique foundation that creates one of the best business models available.
So, why are these principles so important? Co-ops must abide by them ultimately creating businesses that are honest, just, transparent, behave with integrity, and remain accountable in every way to one another and the community they serve.
Principle 1: Open and Voluntary Membership
- A Co-op is a voluntary organization open to everyone
- No gender, social, racial, political, or religious discrimination
Everyone is welcome! Anyone can join the Co-op, but also anyone can shop in our store when it’s open and attend our events (with the exception of the annual member meeting).
Principle 2: Democratic Member Control
- A Co-op is a democratic organization
- Member-owners actively participate in policies and decisions (One member=One Vote)
Member-owners purchase a member share in the Co-op. This is different from an ongoing fee you pay for membership to many other organizations. Once you own a share, you have an equal vote and say in your Co-op and how it is run. Your vote is most often used to elect board members who represent member-owners in day-to-day decision making. But member-owners are listened to and can voice concerns every step of the way.
Principle 3: Member Economic Participation
- Member-owners contribute equitably to the cooperative capital
- Profits are reinvested into the Co-op itself, or other membership-approved activities
Each member-share is an equal ownership in your co-op. In profitable years, member-owners may receive dividends dependent upon frequency of purchases in the store.
Principle 4: Autonomy and Independence
- A Co-op is an autonomous, self-help organization
- Controlled by its members
Co-ops are not part of larger corporations, but instead respond to their board elected by the member-ownership. Co-ops are locally focused and locally controlled which provides more community connection and buy-in.
Principle 5: Education, Training and Information
- A Co-op provides education and training, not just for members, but for community betterment as well
Co-ops educate. Co-ops train. Co-ops provide information. Co-ops focus these provisions on membership, employees, elected representatives, managers, and also provide details about the nature and benefits of cooperation to the general public.
Principle 6: Cooperation among Cooperatives
- Cooperative businesses collaborate rather than compete with one another to ensure the best opportunity for success within and among these businesses.
When starting up and once doors are open, our Co-op is reaching out to as well as providing assistance for other food co-ops across the nation. We help one another progress more quickly by not having to recreate the wheel at every step but instead sharing ideas, discussing both successes and failures, and promoting one another.
Principle 7: Concern for Community
- A Co-op works toward sustainable development of its own community
- Member-owners develop policies toward this end
With regards to sustainable community enhancement, the Co-op should be present and behind these efforts. When a co-op is focusing energies on opening doors, much of the concern for community is wrapped up in efforts to bring the store to the area sooner rather than later. While maintaining this focus, the Co-op finds ways to collaborate with community organizations, participates in service projects, and promotes community engagement in a multitude of ways that will become even more robust once we have a viable and vibrant grocery store.
There you have it! Your 7 Cooperative Principles explained. I encourage you to revisit these from time to time to fully understand the unique business we are bringing to the Cedar Valley. As always, do not hesitate to contact me with any questions. Thanks for your time and support.