What is co-operative business?

The International Co-operative Alliance (ICA) defines a co-operative as follows

“A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise."

Co-operatives are in other words businesses in which the fulfillment of common goals is essential. How does this show? Co-operatives differentiate themselves from other businesses by the merging of 3 relationships of members with the co-operative:

  1. They use the co-operative – as consumer, producer, supplier, employee etc. Co-operatives are businesses aiming at achieving the common goals of their members – pure amongst themselves as well as social. This ‘transaction relationship’ is essential as this is the reason of the existence of the co-operative. Consequently it is about ‘goal maximalization’ rather than ‘profit maximalization’.
  2. They invest (risk-)capital, and consequently are owners.
  3. They run and control the co-operative democratically.

There are different types of cooperatives:

  • workercooperatives
  • businesscooperatives, including producercooperatives
  • consumer- & citizencooperatives, including community cooperatives
  • multistakeholdercooperatives

Ideal typically co-operatives work according to the 7 ICA-principes:

  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 among Co-operatives
  7. Concern for Community

Did you know that there are 26,000 co-operative companies in Belgium, of which 500 ‘official recognised’? No, then it is worth the effort to run through these articles.

Do you want to know more? Brows through our website and certainly through the these publications.