Co-operatives

The Basic Issue

A friend of mine, who spent years in the credit sector of co-ops commented that one of the biggest problems with Credit Unions and Co-ops is that they work. In Credit Unions, they leverage people out of some messy financial situations. When they get out, they tend to turn around and say " give me a return on investment equal to banks or I'll go elsewhere". So CU's are left with a dilemma - adapt or disappear...but when they do adapt, they are not providing the service they are designed for. Father Cody, pioneer of Credit Unions in Canada in the 1940's commented that unless there was a spiritual base to the Credit Union movement it would likely founder for just this reason.

In the past few years, there have been a number of innovations to the Co-op philosophy and approach, mainly driven by the need to generate capital. For example, Saskatchewan Wheat Pool has gone public with non-voting preferred shares in addition to the voting membership share base from before. Then there are the so-called "New Generation" Co-ops which have had significant impact in the United States and are catching on here. They offer a hybrid of old co-op philosophy and share capital funding in order to meet the challenges of today's global market reality.

Rural Development Institute Research Studies

• " Principles of Organizational Restructuring in Rural Organizations: Co-operatives" - Brett Fairbairn (Chap.7) in Changing Rural Institutions
  Brett is both a historian of and central player in the co-op movement on the prairies. In this paper, he holds out the possibility that co-ops could be a leading player in shaping the globalization dynamic in that they have been wrestling with one of the central issues in the globalization debate since their inception. He sees co-ops as bridge organizations between the drive for return on investment and the drive for community values. It is because the organization has a long history of trying to balance these often-conflicting imperatives, that he feels they have a worthwhile, yet undervalued contribution to make to the current discourse. In this paper, he looks at some of the principles of restructuring institutions which they have discovered from their experience as Co-ops over the last few years. He addresses six of these lessons:
  1. go regional
  2. community based amalgamation decisions
  3. Vertical integration of services
  4. Horizontal integration
  5. Structural change is important
  6. New organizations are important (re-imagine)

  He feels it is important to note the social movement context out of which the original co-ops formed and remember that this reality is not just adjunct but central to their present reality.

Other Resources