Equitability ensures enlightened edification

International Cooperative Alliance Cooperative Principals provide guiding framework for fairness in operating democratically controlled businesses.

Many feel that Benjamin Franklin’s idea of a mutual fire insurance company in Philadelphia was the beginning of cooperatives. They came together to do as one, what they could not do as individuals. Franklin did introduce the concept in America, but the foundation dated back to England. Leaning from this culture in Rochdale, England a group of 74 households raised £181 of capital, about two weeks pay each, and began the first co-operative store.

The Rochdale Pioneers open their store in 1844, selling basic needs like: sugar, butter, flour, oatmeal and tallow candles. The first year produced a profit of £22 on £710 of sales. Reasonable profits were returned to the members based on patronage (purchases by members), education of members, manufacturing for the procurement of needs, raising adequate capital, providing housing opportunities and assisting other like societies.

Membership was open to all and the newest member joined at the same investment as the original members. Clear language indicated one member-one vote anticipating both men and women being members and sharing in the management. To eliminate confusion of purpose, politics and religion had no place in the cooperative. Another banned practice was the extension of credit; cash on the barrel head was the standard method of payment.

These principals stood for over 100 years until after World War II. Beginning in 1945 the International Cooperative Alliance (ICA) began the work of re-shaping the principals to meet the needs of newer cooperative models. After 20 years of discussions and revisions the ICA adopted the current cooperative principals. The core values remain:

  1. Candid acceptance of members
  2. Control of resources by members
  3. Contributed capital by members
  4. Customary usage by members
  5. Continuous education of members
  6. Cooperation with other cooperatives
  7. Concern for community (added in 1995)

The dairy farmer I worked for was fond of saying about barns, “If you keep up the foundation and roof, a barn will last forever.” Cooperatives have very strong foundations, but they constantly need to fix the holes where the rain comes in. The Michigan State University Product Center can assist existing and potential rural Michigan cooperatives with education, analysis and business development.

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