What makes a co-op a co-op?
It's more than bags of bulgur, or sprouty sandwiches, or any of the other tired cliches.
According to Donald A. Frederick, an attorney writing for the U.S. Department of Food and Agriculture's Rural Development, “A cooperative is a business that is owned, financed, and controlled by the people who use its services. Earnings are allocated and distributed to members based on patronage, rather than to investors based on equity.”
In Vermont, cooperatives - which are usually, but not always, legal for-profit corporations - are governed by the 1985 Worker Cooperative Corporations Act.
It's way more than food. According to the National Cooperative Business Association, cooperatives are especially common in agriculture, child care/pre-school, financial services, funeral and memorial societies, health care, housing, mutual insurance companies, marketing, manufacturing, and technology.
Ocean Spray and Cabot Creamery are co-ops owned by growers and farmers, respectively. Ace Hardware is a distribution co-op owned by its member hardware stores. And as an alternative to a bank, credit unions like Members First or River Valley are, in fact, co-ops owned by - and legally accountable to - their account holders.
Modern cooperatives follow the model of the Rochdale Society of Equitable Pioneers, founded in England, in 1844. The group of 28 flannel weavers, cloggers, shoemakers, joiners, and cabinet makers banded together to create a grocery store for their common good.
The values and principles of the Rochdale Society guide today's cooperatives.
Cooperative values
According to the International Co-operative Alliance, those values include:
• Self-help. In cooperatives, people help each other while helping themselves by working together for mutual benefit.
• Self-responsibility. Individuals within cooperatives act responsibly and play a full part in the organization.
• Democracy. A cooperative will be structured so that members have control over the organization – one member, one vote.
• Equality. Each member will have equal rights and benefits (according to their contribution).
• Equity. Members will be treated justly and fairly.
• Solidarity. Members will support one another and other cooperatives.
• Honesty.
• Openness.
• Social responsibility.
• Caring for others.
Cooperative principles
Cooperative principles, as described by the International Co-operative Alliance:
1. Voluntary and open membership 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 control by members, who actively participate in setting their policies and making decisions. Elected representatives are accountable to the membership.
3. Members contribute equitably to, and democratically control, the capital of their cooperative.
4. Autonomy and independence.
5. Education, training, and information for members, elected representatives, managers, and employees.
6. Cooperation among cooperatives.
7. Concern for community.