Cooperative Movement Research Paper

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Erselle Stabler May.20.2008 Digitalizing Movements Research Paper

[edit] Cooperative principles are ethical solutions to creating a sustainable future

A mathematician, an accountant and an economist apply for the same job.

The interviewer calls in the mathematician and asks "What do two plus two equal?" The mathematician replies "Four." The interviewer asks "Four, exactly?" The mathematician looks at the interviewer incredulously and says "Yes, four, exactly."

Then the interviewer calls in the accountant and asks the same question "What do two plus two equal?" The accountant says "On average, four - give or take ten percent, but on average, four."

Then the interviewer calls in the economist and poses the same question "What do two plus two equal?" The economist gets up, locks the door, closes the shade, sits down next to the interviewer and says, "What do you want it to equal"? [1]

My answer......."COOPERATION!"

[edit] Introduction

The cooperative movement is a very humane, sustainable, and realistic approach to doing business in today’s world. I intend in this paper to discuss the positive principles behind the cooperative movement. These principles are the backbone of a business structure that supports humanity to exist in a large and densely populated world, to transcend inequality, where there is enough supply and integrity for all (abundance). The main forms of cooperatives out there today are the consumers' cooperative, which is when people organize for wholesale or retail distribution and is often agricultural. The Producers’ cooperatives are manufacturing and distributive organizations that are owned and operated by the workers. There are also cooperatives of insurance, medical services, credit unions, housing, and other fields.

A cooperative is defined by the International Cooperative Alliance as a group of people who join together in a common undertaking, in accord with the seven revised principles as follows [(ICA, 2008)]

[edit] Cooperative Principles

1. Offer voluntary and open membership
2. Govern by democratic member participation (one member, one share, one vote),
3. Operate by equal and “fair” investment by the members,
4. Remain free of intervention from governments or any other outside power (for example, corporations),
5. Educate its members and the community about the nature, principles, values, and benefits of the cooperative
6. Encourage cooperation among cooperatives, and
7. Protect the environment and contribute to the sustainable development of the community.

In examining theses principles further, I intend to reveal why the cooperative movement is just and humane, and is suitable for a sustainable future. First I would like to reveal some history of the cooperative movement, such as how and why the cooperative came into existence. Then I will discuss the ethical principles that the cooperative movement is built upon and still thrives within today. Lastly I will provide a conclusion to reveal why the cooperative principles are an ethical solution to creating a sustainable future.

[edit] History

Rochdale, England 1844 where the first cooperative wholesale society formed and created the cooperative principles as a code of conduct. The first six of the principles above were the original principles from the Rochdale Cooperative, with the seventh added by the ICA to extend the cooperatives responsibility to the community. A century earlier a fire insurance cooperative, and a cheesemaker cooperative had formed, but without formal codes. The Rochdale group was unique in contracting the movement into formal principles binding the formation of the cooperative. A group of 28 weavers came together after being laid off by local manufacturing companies, to establish a small cooperatively owned store, which sold weavers’ supplies, agricultural products and food.

The Rochdale group “was established as a declared anti-capitalistic reaction against “class privileges and monopolies” . Because cooperatives were forming out of disadvantageous market competition, their democratic cooperative position reinforced peoples want to be equally involved in making day to day business and living decisions. And through such principles as above, we are able understand the beliefs that the cooperatives intended to create, due to the lack of these beliefs in the concurrent market place.

[edit] Principles

The first principle to offer voluntary and open membership is supported by the constitution of the United States of America, meaning the right of open membership to all regardless of race, class, gender, and other social stigmas. There are no pre-requisites to membership of the cooperative business, no limitations on who is able to receive benefit from such consolidation of economic benefit, or group affiliation. Each member of the group will benefit from the economic and social impacts of joining the cooperative. Members will also have the chance to give back to their communities through participation, a benefit which may provide a level of compassion and nurture the individuals need to be a part of something bigger. The membership benefits not only the whole group but also the individual, by being a member of the cooperative.

The second principle to govern by democratic member participation is seen when a cooperative evenly distributes shares of the company, and limits authoritative control. Men and women serving on the board are in equal power to make decisions; they help set policies, and make decisions. Third party members are sometimes involved when a network of cooperatives exists. In the cooperative model of capitalism “workers are also members. They hire the management. Laborers become people again in the cooperative model, and demand is again the driver.” This is as apposed to the standards model of capitalism where labor is the commodity. This principle gives people their voices and dignity that they too are human beings with value and worth. This is an ethical way of doing business, which validates and respects the human being.

The third principle is to operate by equal and “fair” investment by the members, according to the ICA, “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.” This allows the co-operative to hold half of all profits and go back into benefiting the members; this is where the democratic structure lies. Social capital, or trust, production and the efficacy of people working together is an ethical approach to believing in one another to be self-accountable, and build integrity.

The fourth principle is for each cooperative to remain free of intervention from governments or any other outside power (for example, corporations). Cooperatives are democratically motivated and run, therefore they do not ever intend on being governed by a single force, it would defeat the purpose of the cooperative. This principle sustains democracy by maintaining a level of diversity in the business market.

The fifth principle is to educate its members and the community about the nature, principles, values, and benefits of the cooperative. Education is seen at all levels in the cooperative, from training the employees, to managers, to the community. There are often cooking classes, environmental awareness classes, and resources for members within the community. This aspect of the cooperatives provides a sense of community involvement and participation that can also be seen in the 7th principle of community.

The sixth principle is to encourage cooperation among cooperatives; this principle strengthens cooperatives by allowing cooperatives to come together for the benefit of the greater good. If each cooperative is beneficial and productive to its members, consumers, and providers of the product, then having groups of individual and yet linked cooperatives will increase cooperative businesses.

The seventh principle protects the environment and contributes to the sustainable development of the community. Cooperatives are responsible to their community by means of sustainable development and protection of the environment in the communities they serve. Cooperatives are now found across the world, where are usually seen to benefit and enhance the communities of involvement, through economics, and human health. The online community of cooperatives is still being implemented. There are ways of finding simple and complex information about cooperative on the World Wide Web. The International Co-operative Alliance has thousands of statistics available on their web site: The Encyclopedia of Business: 2nd edition, is an informative site for people interested in the business logistics of cooperatives. The online community is becoming a great resource for people new or old to learn and explore more about cooperatives.


[edit] Sustainable outcome

In order to achieve a sustainable future we each need to look at what our behaviors and choices are, and how these are impacting our futures. Finding a balance between economic, social, and ecological factors will help us reveal how to go forward by creating a sustainable outcome.

“Individual choices frequently are made from a shortterm, self-interested perspective,
whereas cooperative choices are made from a long-term, community and resource-sustainability perspective.”

“Three barriers to successful integration of structural and behavioral solutions
are identified as self-interest, mistrust, and variable perceptions of resource amenities.”

Cooperative principles are excellent criteria to implement in the future of sustainable business policy. They provide groundwork for ethical creation of large businesses that work together with trust and democracy to empower the individual through the whole group by means of economic, social, and ecological sustainability. The cooperative movement is therefore an excellent model for sustainability, by implementing the principles that were established by the Rochdale group in England 1844, society can prepare for a better future. The cooperative principles are empowering to individuals, through democracy cooperatives empower the whole group, and through cooperative principles; cooperatives can empower the world.

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