
A cooperative (also known as co-operative, co-op, or coop) is "an
autonomous
In developmental psychology and moral, political, and bioethical philosophy, autonomy, from , ''autonomos'', from αὐτο- ''auto-'' "self" and νόμος ''nomos'', "law", hence when combined understood to mean "one who gives oneself one's ...
association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically-controlled
enterprise
Enterprise (or the archaic spelling Enterprize) may refer to:
Business and economics
Brands and enterprises
* Enterprise GP Holdings, an energy holding company
* Enterprise plc, a UK civil engineering and maintenance company
* Enterprise ...
".
[Statement on the Cooperative Identity.](_blank)
''International Cooperative Alliance
The International Co-operative Alliance (ICA) is a non-governmental co-operative federation or, more precisely, a co-operative union representing co-operatives and the co-operative movement worldwide. It was founded in 1895 to unite, represent an ...
.'' Cooperatives are democratically controlled by their members, with each member having one vote in electing the board of directors.
Cooperatives may include:
*
businesses owned and managed by the people who consume their goods and/or services (a
consumer cooperative
A consumers' co-operative is an enterprise owned by consumers and managed democratically and that aims at fulfilling the needs and aspirations of its members. Such co-operatives operate within the market system, independently of the state, as a ...
)
* businesses where producers pool their output for their common benefit (a producer cooperative)
* organizations managed by the people who work there (a
worker cooperative
A worker cooperative is a cooperative owned and self-managed by its workers. This control may mean a firm where every worker-owner participates in decision-making in a democratic fashion, or it may refer to one in which management is elected by ...
)
* businesses where members pool their purchasing power (a purchasing cooperative)
* multi-stakeholder or hybrid cooperatives that share ownership between different stakeholder groups. For example, care cooperatives where ownership is shared between both care-givers and receivers. Stakeholders might also include non-profits or investors.
* second- and third-tier cooperatives whose members are other cooperatives
*
platform cooperative
A platform cooperative, or platform co-op, is a cooperatively owned, democratically governed business that establishes a computing platform, and uses a website, mobile app or a protocol to facilitate the sale of goods and services. Platform coopera ...
s that use a cooperatively owned and governed website, mobile app or a protocol to facilitate the sale of goods and services.
Research published by the
Worldwatch Institute
The Worldwatch Institute was a globally focused environmental research organization based in Washington, D.C., founded by Lester R. Brown. Worldwatch was named as one of the top ten sustainable development research organizations by Globescan Surv ...
found that in 2012 approximately one billion people in 96 countries had become members of at least one cooperative. The turnover of the largest three hundred cooperatives in the world reached $2.2
trillion
''Trillion'' is a number with two distinct definitions:
* 1,000,000,000,000, i.e. one million million, or (ten to the twelfth power), as defined on the short scale. This is now the meaning in both American and British English.
* 1,000,000,00 ...
.
Cooperative businesses are typically more productive and economically
resilient
Resilience, resilient, resiliency, or ''variation'', may refer to:
Science
Ecology
* Ecological resilience, the capacity of an ecosystem to recover from perturbations
** Climate resilience, the ability of systems to recover from climate change
* ...
than many other forms of enterprise, with twice the number of co-operatives (80%) surviving their first five years compared with other business
ownership
Ownership is the state or fact of legal possession and control over property, which may be any asset, tangible or intangible. Ownership can involve multiple rights, collectively referred to as title, which may be separated and held by different ...
models (41%) according to data from United Kingdom.
The largest worker owned cooperative in the world, the
Mondragon Corporation
The Mondragon Corporation is a corporation and federation of worker cooperatives based in the Basque region of Spain.
It was founded in the town of Mondragon in 1956 by José María Arizmendiarrieta and a group of his students at a technical ...
(founded by Catholic priest
José María Arizmendiarrieta
Father José María Arizmendiarrieta Madariaga ( Marquina-Xemein, Bizkaia, Spain, April 22, 1915 - Mondragon, Gipuzkoa, Spain, November 29, 1976) was a Basque Catholic priest and promoter of the cooperative companies of the Mondragon Corporat ...
), has been in continuous operation since 1956.
Cooperatives frequently have social goals, which they aim to accomplish by investing a proportion of trading profits back into their communities. As an example of this, in 2013,
retail co-operative
A consumers' co-operative is an enterprise owned by consumers and managed democratically and that aims at fulfilling the needs and aspirations of its members. Such co-operatives operate within the market system, independently of the state, as a fo ...
s in the
UK invested 6.9% of their pre-tax profits in the communities in which they trade as compared with 2.4% for other rival
supermarkets
A supermarket is a self-service shop offering a wide variety of food, beverages and household products, organized into sections. This kind of store is larger and has a wider selection than earlier grocery stores, but is smaller and more limite ...
.
Since 2002, cooperatives have been distinguishable on the Internet through the use of a
.coop
.coop is a sponsored top-level domain (sTLD) in the Domain Name System of the Internet. It is intended for the use of cooperatives, their wholly owned subsidiaries, and other organizations that exist to promote or support cooperatives.
The TL ...
domain. In 2014, the
International Co-operative Alliance (ICA) introduced the Cooperative Marque, meaning ICA cooperatives and
WOCCU credit unions can also be identified through a coop
ethical consumerism
Ethical consumerism (alternatively called ethical consumption, ethical purchasing, moral purchasing, ethical sourcing, or ethical shopping and also associated with sustainable and green consumerism) is a type of consumer activism based on the con ...
label.
Origins and history
Cooperation dates back as far as human beings have been organizing for mutual benefits. Tribes were organized as cooperative structures, allocating jobs and resources among each other, only trading with the external communities. In alpine environments, trade could only be maintained in organized cooperatives to achieve a useful condition of artificial roads such as
Viamala
Viamala or Via Mala ( Romansh: literally, "bad path") is a narrow gorge along the river Hinterrhein between Zillis-Reischen and Thusis in the Canton of Graubünden, Switzerland, as well as the ancient and notorious pathway which traverse ...
in 1472. Pre-industrial Europe is home to the first cooperatives from an industrial context. The roots of the cooperative movement can be traced to multiple influences and extend worldwide. In the
English-speaking world
Speakers of English are also known as Anglophones, and the countries where English is natively spoken by the majority of the population are termed the ''Anglosphere''. Over two billion people speak English , making English the largest languag ...
, post-
feudal forms of cooperation between workers and owners that are expressed today as "
profit sharing
Profit sharing is various incentive plans introduced by businesses that provide direct or indirect payments to employees that depend on company's profitability in addition to employees' regular salary and bonuses. In publicly traded companies th ...
" and "surplus sharing" arrangements existed as far back as 1795. The key ideological influence on the Anglosphere branch of the cooperative movement, however, was a ''rejection'' of the
charity
Charity may refer to:
Giving
* Charitable organization or charity, a non-profit organization whose primary objectives are philanthropy and social well-being of persons
* Charity (practice), the practice of being benevolent, giving and sharing
* Ch ...
principles that underpinned
welfare
Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specificall ...
reforms when the
British government
ga, Rialtas a Shoilse gd, Riaghaltas a Mhòrachd
, image = HM Government logo.svg
, image_size = 220px
, image2 = Royal Coat of Arms of the United Kingdom (HM Government).svg
, image_size2 = 180px
, caption = Royal Arms
, date_est ...
radically revised its
Poor Laws
In English and British history, poor relief refers to government and ecclesiastical action to relieve poverty. Over the centuries, various authorities have needed to decide whose poverty deserves relief and also who should bear the cost of h ...
in 1834. As both state and church institutions began to routinely distinguish between the 'deserving' and 'undeserving' poor, a movement of friendly societies grew throughout the
British Empire
The British Empire was composed of the dominions, colonies, protectorates, mandates, and other territories ruled or administered by the United Kingdom and its predecessor states. It began with the overseas possessions and trading post ...
based on the principle of mutuality, committed to self-help in the welfare of working people.

In 1761, the
Fenwick Weavers' Society
The Fenwick Weavers' Society was a professional association created in the village of Fenwick, East Ayrshire, Scotland in 1761.
In 1769, the society formed a consumer co-operative for the benefit of members.
The original purpose of the societ ...
was formed in
Fenwick, East Ayrshire
Fenwick is a village in East Ayrshire, Scotland. In 2019, its population was estimated to be 989. Fenwick is the terminus of the M77 following its extension which was opened in April 2005, at the beginning of the Kilmarnock bypass.
History
T ...
,
Scotland
Scotland (, ) is a country that is part of the United Kingdom. Covering the northern third of the island of Great Britain, mainland Scotland has a border with England to the southeast and is otherwise surrounded by the Atlantic Ocean to th ...
to sell
discounted
Discounting is a financial mechanism in which a debtor obtains the right to delay payments to a creditor, for a defined period of time, in exchange for a charge or fee.See "Time Value", "Discount", "Discount Yield", "Compound Interest", "Efficient ...
oatmeal
Oatmeal is a preparation of oats that have been de-husked, steamed, and flattened, or a coarse flour of hulled oat grains ( groats) that have either been milled (ground) or steel-cut. Ground oats are also called white oats. Steel-cut oats ...
to local workers. Its services expanded to include assistance with savings and loans, emigration and education. In 1810,
Welsh
Welsh may refer to:
Related to Wales
* Welsh, referring or related to Wales
* Welsh language, a Brittonic Celtic language spoken in Wales
* Welsh people
People
* Welsh (surname)
* Sometimes used as a synonym for the ancient Britons (Celtic peopl ...
social reform
A reform movement or reformism is a type of social movement that aims to bring a social or also a political system closer to the community's ideal. A reform movement is distinguished from more radical social movements such as revolutionary m ...
er
Robert Owen
Robert Owen (; 14 May 1771 – 17 November 1858) was a Welsh textile manufacturer, philanthropist and social reformer, and a founder of utopian socialism and the cooperative movement. He strove to improve factory working conditions, promoted e ...
, from Newtown in mid-
Wales
Wales ( cy, Cymru ) is a Countries of the United Kingdom, country that is part of the United Kingdom. It is bordered by England to the Wales–England border, east, the Irish Sea to the north and west, the Celtic Sea to the south west and the ...
, and his partners purchased the
New Lanark
New Lanark is a village on the River Clyde, approximately 1.4 miles (2.2 kilometres) from Lanark, in Lanarkshire, and some southeast of Glasgow, Scotland. It was founded in 1785 and opened in 1786 by David Dale, who built cotton mills and housi ...
mill from Owen's father-in-law,
David Dale
David Dale (6 January 1739–7 March 1806) was a leading Scottish industrialist, merchant and philanthropist during the Scottish Enlightenment period at the end of the 18th century. He was a successful entrepreneur in a number of areas, m ...
, and proceeded to introduce better labour standards, including discounted retail shops where profits were passed on to his employees. Owen left New Lanark to pursue other forms of cooperative organization and develop coop ideas through writing and lecture. Cooperative communities were set up in
Glasgow
Glasgow ( ; sco, Glesca or ; gd, Glaschu ) is the most populous city in Scotland and the fourth-most populous city in the United Kingdom, as well as being the 27th largest city by population in Europe. In 2020, it had an estimated pop ...
,
Indiana
Indiana () is a U.S. state in the Midwestern United States. It is the 38th-largest by area and the 17th-most populous of the 50 States. Its capital and largest city is Indianapolis. Indiana was admitted to the United States as the 19th ...
and
Hampshire
Hampshire (, ; abbreviated to Hants) is a ceremonial county, ceremonial and non-metropolitan county, non-metropolitan counties of England, county in western South East England on the coast of the English Channel. Home to two major English citi ...
, although ultimately unsuccessful. In 1828,
William King William King may refer to:
Arts
*Willie King (1943–2009), American blues guitarist and singer
* William King (author) (born 1959), British science fiction author and game designer, also known as Bill King
*William King (artist) (1925–2015), Am ...
set up a newspaper, ''The Cooperator'', to promote Owen's thinking, having already set up a cooperative store in Brighton.
Also in 1810,
Rev. Henry Duncan of the
Ruthwell
Ruthwell is a village and parish on the Solway Firth between Dumfries and Annan in Dumfries and Galloway, Scotland.
Thomas Randolph, Earl of Moray, gave Ruthwell to his nephew, Sir William Murray, confirmed to Sir John Murray, of Cockpool, i ...
Presbyterian Church
Presbyterianism is a part of the Reformed tradition within Protestantism that broke from the Roman Catholic Church in Scotland by John Knox, who was a priest at St. Giles Cathedral (Church of Scotland). Presbyterian churches derive their na ...
in
Dumfriesshire
Dumfriesshire or the County of Dumfries or Shire of Dumfries (''Siorrachd Dhùn Phris'' in Gaelic) is a historic county and registration county in southern Scotland. The Dumfries lieutenancy area covers a similar area to the historic county.
...
,
Scotland
Scotland (, ) is a country that is part of the United Kingdom. Covering the northern third of the island of Great Britain, mainland Scotland has a border with England to the southeast and is otherwise surrounded by the Atlantic Ocean to th ...
founded a
friendly society
A friendly society (sometimes called a benefit society, mutual aid society, benevolent society, fraternal organization or ROSCA) is a mutual association for the purposes of insurance, pensions, savings or cooperative banking. It is a mutua ...
to create a
cooperative
A cooperative (also known as co-operative, co-op, or coop) 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-contro ...
depository institution
Colloquially, a depository institution is a financial institution in the United States (such as a savings bank, commercial bank, savings and loan associations, or credit unions) that is legally allowed to accept monetary deposits from consumers. ...
at which his poorest parishioners could hold
savings account
A savings account is a bank account at a retail bank. Common features include a limited number of withdrawals, a lack of cheque and linked debit card facilities, limited transfer options and the inability to be overdrawn. Traditionally, tran ...
s accruing
interest
In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is disti ...
for
sickness and old-age, which was the first established
savings bank
A savings bank is a financial institution whose primary purpose is accepting savings deposits and paying interest on those deposits.
They originated in Europe during the 18th century with the aim of providing access to savings products to ...
that would be merged into the
Trustee Savings Bank
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
between 1970 and 1985.
The
Rochdale Society of Equitable Pioneers
The Rochdale Society of Equitable Pioneers, founded in 1844, was an early consumers' co-operative, and one of the first to pay a patronage dividend, forming the basis for the modern co-operative movement.
Although other co-operatives preceded i ...
, founded in 1844, is usually considered the first successful cooperative enterprise, used as a model for modern coops, following the '
Rochdale Principles
The Rochdale Principles are a set of ideals for the operation of cooperatives. They were first set out in 1844 by the Rochdale Society of Equitable Pioneers in Rochdale, England and have formed the basis for the principles on which co-operat ...
'. A group of 28 weavers and other artisans in
Rochdale
Rochdale ( ) is a large town in Greater Manchester, England, at the foothills of the South Pennines in the dale on the River Roch, northwest of Oldham and northeast of Manchester. It is the administrative centre of the Metropolitan Borough ...
, England set up the society to open their own store selling food items they could not otherwise afford. Within ten years there were over a thousand cooperative societies in the United Kingdom.
"Spolok Gazdovský" (''The Association of Administrators'' or ''The Association of Farmers'') founded in 1845 by Samuel Jurkovič, was the first cooperative in Europe (
Credit union
A credit union, a type of financial institution similar to a commercial bank, is a member-owned nonprofit financial cooperative. Credit unions generally provide services to members similar to retail banks, including deposit accounts, provision ...
). The cooperative provided a cheap loan from funds generated by regular savings for members of the cooperative. Members of cooperative had to commit to a moral life and had to plant two trees in a public place every year. Despite the short duration of its existence, until 1851, it thus formed the basis of the cooperative movement in Slovakia. Slovak national thinker
Ľudovít Štúr
Ľudovít Velislav Štúr (; hu, Stur Lajos; 28 October 1815 – 12 January 1856), known in his era as Ludevít Štúr, (pen names : B. Dunajský, Bedlivý Ludorob, Boleslav Záhorský, Brat Slovenska, Ein Slave, Ein ungarischer Slave, Karl Wi ...
said about the association: "''We would very much like such excellent constitutions to be established throughout our region. They would help to rescue people from evil and misery. A beautiful, great idea, a beautiful excellent constitution!''"
Other events such as the founding of a
friendly society
A friendly society (sometimes called a benefit society, mutual aid society, benevolent society, fraternal organization or ROSCA) is a mutual association for the purposes of insurance, pensions, savings or cooperative banking. It is a mutua ...
by the
Tolpuddle Martyrs
The Tolpuddle Martyrs were six agricultural labourers from the village of Tolpuddle in Dorset, England, who, in 1834, were convicted of swearing a secret oath as members of the Friendly Society of Agricultural Labourers. They were arrested ...
in 1832 were key occasions in the creation of organized labor and consumer movements.
Friendly Societies established forums through which
one member, one vote
In the parliamentary politics of the United Kingdom and Canada, one member, one vote (OMOV) is a method of selecting party leaders, and determining party policy, by a direct vote of the members of a political party. Traditionally, these objectives ...
was practiced in organisation decision-making. The principles challenged the idea that a person should be an owner of
property
Property is a system of rights that gives people legal control of valuable things, and also refers to the valuable things themselves. Depending on the nature of the property, an owner of property may have the right to consume, alter, share, r ...
before being granted a political voice. Throughout the second half of the nineteenth century (and then repeatedly every twenty years or so) there was a surge in the number of cooperative organisations, both in commercial practice and civil society, operating to advance
democracy
Democracy (From grc, δημοκρατία, dēmokratía, ''dēmos'' 'people' and ''kratos'' 'rule') is a form of government in which people, the people have the authority to deliberate and decide legislation ("direct democracy"), or to choo ...
and
universal suffrage
Universal suffrage (also called universal franchise, general suffrage, and common suffrage of the common man) gives the right to vote to all adult citizens, regardless of wealth, income, gender, social status, race, ethnicity, or political sta ...
as a political principle. Friendly Societies and consumer cooperatives became the dominant form of organization amongst working people in Anglosphere
industrial societies
In sociology, industrial society is a society driven by the use of technology and machinery to enable mass production, supporting a large population with a high capacity for division of labour. Such a structure developed in the Western world in ...
prior to the rise of
trade unions
A trade union (labor union in American English), often simply referred to as a union, is an organization of workers intent on "maintaining or improving the conditions of their employment", ch. I such as attaining better wages and benefits (s ...
and industrial factories. Weinbren reports that by the end of the 19th century, over 80% of British working age men and 90% of Australian working age men were members of one or more Friendly Society.
[Weinbren, D. & James, B. (2005) "Getting a Grip: the Roles of Friendly Societies in Australia and Britain Reappraised", Labour History, Vol. 88](_blank)
.
From the mid-nineteenth century,
mutual organisation
A mutual organization, or mutual society is an organization (which is often, but not always, a company or business) based on the principle of mutuality and governed by private law. Unlike a true cooperative, members usually do not contribute t ...
s embraced these ideas in economic enterprises, firstly amongst tradespeople, and later in cooperative stores, educational institutes, financial institutions and industrial enterprises. The common thread (enacted in different ways, and subject to the constraints of various systems of national law) is the principle that an enterprise or association should be owned and controlled by the people it serves, and share any surpluses on the basis of each member's cooperative contribution (as a producer, labourer or consumer) rather than their capacity to invest financial capital.
The
International Co-operative Alliance was the first international association formed (1895) by the cooperative movement. It includes the
World Council of Credit Unions
The World Council of Credit Unions (WOCCU) is an international trade association and development agency for credit unions headquartered in Madison, Wisconsin. WOCCU aims to improve lives through credit unions and other financial cooperatives th ...
. The International Cooperative Alliance was founded in London, England on 19 August 1895 during the 1st Cooperative Congress.
In attendance were delegates from cooperatives from Argentina, Australia, Belgium, England, Denmark, France, Germany, Holland, India, Italy, Switzerland, Serbia, and the US.
A second organization formed later in Germany: the International
Raiffeisen Union. In the United States, the
National Cooperative Business Association
The National Cooperative Business Association (NCBA) is a United States membership organization for cooperatives, which are businesses that are jointly owned and democratically controlled.
The association was founded in 1916 as the Cooperative L ...
(NCBA CLUSA; the abbreviation of the organization retains the initials of its former name, Cooperative League of the USA) serves as the
sector
Sector may refer to:
Places
* Sector, West Virginia, U.S.
Geometry
* Circular sector, the portion of a disc enclosed by two radii and a circular arc
* Hyperbolic sector, a region enclosed by two radii and a hyperbolic arc
* Spherical sector, a p ...
's oldest national membership association. It is dedicated to ensuring that cooperative businesses have the same opportunities as other businesses operating in the country and that consumers have access to cooperatives in the marketplace.
In 1945
Artturi Ilmari Virtanen
Artturi Ilmari Virtanen (; 15 January 1895 – 11 November 1973) was a Finnish chemist and recipient of the 1945 Nobel Prize in Chemistry "for his research and inventions in agricultural and nutrition chemistry, especially for his fodder prese ...
received the
Nobel Prize in Chemistry
)
, image = Nobel Prize.png
, alt = A golden medallion with an embossed image of a bearded man facing left in profile. To the left of the man is the text "ALFR•" then "NOBEL", and on the right, the text (smaller) "NAT•" then "M ...
for his invention of the
AIV silage. This invention improved milk production and created a method of preserving butter, the AIV salt, which led to increased Finnish butter exports. He had started his career in chemistry in
Valio
Valio Ltd ( fi, Valio Oy) is a Finnish manufacturer of dairy products and one of the largest companies in Finland. Valio's products include cheese, powdered ingredients, butter, yogurt and milk. It is Finland's largest milk processor, producing ...
, a cooperative of dairy farmers in which he headed the research department for 50 years and where all his major inventions were first put to practice.
Cooperative banks were first to adopt online banking.
Stanford Federal Credit Union
Stanford Federal Credit Union (or Stanford FCU) is a federally chartered credit union located in Palo Alto, California. It provides banking services to the Stanford community. Stanford FCU has over $3.6 billion in assets and serves over 80,000 m ...
was the first
financial institution
Financial institutions, sometimes called banking institutions, are business entities that provide services as intermediaries for different types of financial monetary transactions. Broadly speaking, there are three major types of financial inst ...
to offer online internet banking services to all of its members in October 1994. In 1996
OP Financial Group
OP Financial Group is one of the largest financial companies in Finland. It consists of 180 cooperative banks and their central organization. “OP” stands for “osuuspankki” in Finnish, literally meaning “cooperative bank”. The financi ...
, also a
cooperative bank
Cooperative banking is retail and commercial banking organized on a cooperative basis. Cooperative banking institutions take deposits and lend money in most parts of the world.
Cooperative banking, as discussed here, includes retail banking car ...
, became the second online bank in the world and the first in Europe.
By 2004 a new association focused on worker co-ops was founded, the
United States Federation of Worker Cooperatives
The United States Federation of Worker Cooperatives (USFWC) is a federation of worker cooperatives in the United States. USFWC was founded at the U.S. Conference of Democratic Workplaces in Minneapolis, Minnesota in May 2004.
The Federation ...
.
The cooperative movement has been fueled globally by ideas of
economic democracy
Economic democracy is a socioeconomic philosophy that proposes to shift decision-making power from corporate managers and corporate shareholders to a larger gro