The Seven Cooperative Principles

Our co-op shares the seven cooperative principles, gratefully borrowed from the Worker Cooperative Code. We are re-sharing it here for our co-op member and others, to support the 5th Principle: Education, training, and information.

What is a worker cooperative?

Cooperatives apply the values of cooperation – autonomy, democracy, equality, equity, and solidarity – in the workplace and in their communities. Worker cooperatives are trading enterprises, owned and run by the people who work in them, who have an equal say in what the business does, and an equitable share in the wealth created from the products and services they provide. As well as benefiting their members, cooperatives act together to ‘build a better world through co-operation'.

“Worker cooperatives have the objective of creating and maintaining sustainable jobs and generating wealth, in order to improve the quality of life of the worker-members, dignify human work, allow workers’ democratic self-management and promote community and local development.” (CICOPA/ICA, 2005.)

1st Principle: Voluntary and open membership

Co‑operative membership is open to all workers able and willing to accept the responsibilities of membership. Worker cooperatives function best as an inclusive team of members with long-term collective interests in the success of the business.

1. Provide all workers with meaningful information about membership and how to join.
2. Provide members with an agreed-upon set of rights and responsibilities, usually as a member job description or membership agreement.
3. [Include a probationary period and membership training for workers who want to become members.]
4. Offer membership to all workers who are able and willing to accept the responsibilities of membership.
5. Ensure the majority of workers are members and the majority of members are workers.

2nd Principle: Democratic member control

Cooperatives are democratic organizations controlled by their members, setting policies and making decisions. Members serving as elected representatives are accountable to the wider membership. Worker cooperatives succeed when all members participate in transparent and fair decision making, but also where members are given delegated authority to act on behalf of the collective.

1. Ensure all members actively participate in the management of the business and long-term planning.
2. Effectively communicate, both between the co‑operative and its members, and between members themselves.
3. Collectively agree and delegate authority to individual members to act on behalf of the cooperative as and where necessary.
4. Ensure there are democratic processes, or democratic accountability, in all governance and management functions.
5. Regularly review the governance and business management processes as they grow and develop.

3rd Principle: Member economic participation

Members contribute equitably to, and democratically control, the capital and finances of their cooperative. Members decide how to use surpluses (profits). Worker cooperatives should provide the pay and other benefits that members need and want, managing the business to provide them and protect its future.

1. Allocate a percentage of surpluses to collectively-owned financial reserves and capital.
2. Ensure that members are enabled to invest in the cooperative if they want to. If members have individual investments, they do not attract additional voting rights.
3. Have a planned and agreed pay- and benefits structure, including non-financial benefits.
4. Aim to offer pay and benefits sufficient to sustain long-term employment and membership, to enable the cooperative to retain the required skills and experience.
5. Ensure that any surplus in the form of pay and benefits is distributed fairly and equitably between members, relative to their contribution.

4th Principle: Autonomy and independence

Cooperatives are independent, self-help organizations controlled by their members. If they raise capital from external sources, they must maintain their cooperative autonomy. Worker cooperatives should actively plan and manage their cooperative to be a successful business and avoid becoming over-dependent on any funder, supplier or customer.

1. Have good financial controls and management, including cashflow forecasts and internal audits of all parts of the business.
2. Actively manage and assign responsibilities for your operations, personnel, marketing, and other business functions.
3. Understand and control risks, both internal and external, facing your cooperative.
4. Build your capability to identify and take advantage of business opportunities.
5. Invest in equipment, premises, and technology sufficient to achieve success.

5th Principle: Education, training, and information

Cooperatives provide education and training for their members and employees so they can contribute effectively to the development of their co‑operative. They inform the general public about the nature and benefits of co-operation. Worker cooperative members should become multi-skilled so that they can participate fully in the management and development of the cooperative.

1. Assess the technical, management, and cooperative skills needed to achieve your long-term plans and replace key members who leave.
2. Ensure all prospective members and elected representatives receive training in membership and cooperative skills.
3. Encourage members in specialist roles to obtain technical skills and professional development for current and future needs.
4. Develop and share management skills and techniques to permit efficient cooperative business coordination.
5. Educate business partners, customers, and the public about the nature and benefits of cooperative forms of business.

6th Principle: Cooperation among Cooperatives

Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, regional, national, and international structures.

1. Network with cooperatives in your locality and industry to share intelligence, understand each others’ business needs and goals, and support each other.
2. Trade with other cooperatives whenever possible.
3. Find and refer new business opportunities to other cooperatives you know and trust.
4. Collaborate with other cooperatives to achieve economies of scale, share costs, access to business opportunities, and joint long-term development.
5. Practice fair and honest commercial competition between cooperatives.
6. Participate in regional and national cooperative activities to promote, develop, and grow the cooperative economy.

7th Principle: Concern for community

Cooperatives work for the sustainable development of their communities by working according to policies approved by their members. Cooperative businesses are rooted in community. By building good relations with your local and wider communities, you will create goodwill and opportunities for your cooperative and members.

1. Actively control the environmental and social impact of your business.
2. Agree and live up to ethical business standards.
3. Operate high health and safety and worker welfare standards.
4. Prioritize and promote ethical and sustainable initiatives, such as fair trade.
5. Participate in local and wider communities and promote cooperative principles within them.