Co-operative Enterprise: The Invisible Giant Diarmuid McDonnell Co-operative Education Trust Scotland 28/03/2013

Outline 1.What is a co-operative? 2.Are they relevant? 3.Are they ethical? 4.How can I get involved? 5.Further resources

Introduction Despite the wide-ranging successes of co- operatives, in financial terms as well as in the development of sustainable communities, the study of these democratic forms of enterprise remains surprisingly absent from the curricula of most university business schools around the world.

Co-operative Investor-owned Company Social Enterprise Purpose Improve the quality of life for members Create wealth for shareholders Achieve a social purpose OwnershipMembersShareholders Usually a community, charity or individual(s) Control Democratic basis - one member, one vote Property right basis - one share, one vote Trustees or equivalent group that may or may not be democratically elected BeneficiaryMembersShareholdersTarget social group Financed by (excluding debt finance) Member contributions and retained earnings Sale of shares and retained earnings Retained earnings and grants Motivational driver Self-help and self- responsibility Personal wealth creationAltruism or public policy Market-orientedYes Distribution of surplusThree methods:  Members  Reinvested in the business  Allocated to social/charitable initiatives Yes in form of dividend related to shareholding Not to individuals, usually reinvested in the enterprise

Types of co-operative

Value-driven Co-op Values Solidarity Equity Equality Democracy Self-help Self-responsibility Ethical Values Openness Honesty Social responsibility Caring for others BUT... Google, Tesco and Barclays have values as well...

Values in action Co-op Principles 1.Voluntary and open membership 2.Democratic member control 3.Member economic participation 4.Autonomy and independence 5.Education, training and information 6.Co-operation amongst co-operatives 7.Concern for community All* co-ops subscribe to these principles – firm ethical foundation

Benefits and downsides But... Not very well understood. Some trouble accessing finance. No single legal form.

Odd one oot!

The Invisible Giant

Co-operatives globally (1) Source: ‘Statistical Information on the Co-operative Movement’ ICA. accessed 29 September 2011.

Co-operatives globally (2)

The UK co-operative sector (1) Source: Co-operatives UK. The UK co-operative economy 2011: Britain’s return to co- operation (Manchester: Co-operatives UK), No. of co-operative businesses in the UK: 5,450 No. of members:12.8m Turnover of co-operatives:£32.2bn No. of people employed by co- operatives: 236,000

The UK co-operative sector (3) Source: Co-operatives UK. The UK co-operative economy 2012: Alternatives to austerity (Manchester: Co-operatives UK, 2012.) p. 13.

Get involved In higher/further education: Join/set up a ‘vegbag’ scheme – Need books or other services? – Freshsight model – In the ‘real world’: Bank/save with a co-op – Shop with a co-op – Create your own co-op

Conclusion 1.Co-ops are businesses 2.Achieve financial, social and economic aims 3.Ethical 4.Come in all shapes and sizes 5.Easy to get involved in

Key message

Further resources Democratic Enterprise – an ebook and VLE aimed at students/graduates containing information about democratic forms of enterprise The UK Co-operative Economy 2012 – facts and infographics from today’s lecture Join the Co-op Future – a 4 minute film that offers a snapshot of the co-operative sector in Scotland