What is a co-operative?

Cooperatives are a group of people working together to meet a shared need. Cooperatives can take many forms and are an exciting model of business or community asset ownership with over 5450 independent cooperatives operating throughout the UK.

The official definition of a cooperative (from International Cooperative Alliance) says a cooperative is: "an association of persons united to meet their common needs and aspirations through a jointly owned and democratically controlled enterprise"

They can be formed of employees of a business, members of a local community or a group of customers. Members of a Cooperative share ownership of a business or organisation and make decisions collectively ensuring everyone has their say.

The seven principles of co-operation

No matter what industry or service they operate in, all cooperatives share the same seven principles of cooperation in their work:

• Voluntary and open membership. People can join and leave as they wish, and membership is open to all
• Democratic member control. A cooperative is controlled by its members who all have a say in how the business operates.
• Membership economic participation. Any profits are distributed to members in proportion to their transactions/involvement with the cooperative. Members control the capital of the business.
• Autonomy and Independence. Any joint venture entered into does not compromise the autonomy, independence or principles of individual members.
• Education, training and information. Cooperatives work to provide education, training and development opportunities to their members.
• Cooperation among cooperatives. Cooperatives seek to benefit their members and other likeminded organisations by working together for the greater good.
• Concern for the community. Cooperatives work for the sustainable development of their communities.

Cooperatives as a business

Cooperative businesses operate like any other successful business with the exception that all the members of the business have an input on what happens to the profits instead of external shareholders.

Often these profits are reinvested in the business to help improve operations or recruit new staff. Profits may also be share among members of the cooperative or used to help fund work in the local community.

Cooperatives bring people together through shared values. They can be businesses in any area and can be any size such as healthcare to housing, farms to football clubs, credit unions to community owned shops, pubs to public relations, wind farms to web design.

See our page on different types of co-operatives for more information.