Most Important Stakeholder
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A survey of Self-Managed Enterprises in Canada.
Co-ops have a simple structure—all members are owners and make decisions based on a one-member, one-vote system. Co-ops are not publicly traded, and profits are not transferred to private shareholders or even divided among employees. Usually the money is put back into the co-op and used to further the economic growth of the local community to serve the broader needs of the members, such as creating more jobs or donating the money to worthy causes.
Co-ops can take many forms, but most co-operatives generally fall into one of four categories: producer (like a farmer’s co-op), consumer co-ops, worker co-ops, and financial co-ops (such as credit unions). Co-ops, by definition, tend to be locally run, but this doesn’t mean they are necessarily small. The world’s largest producer of maple products, La coopérative de producteurs de sirop d’érable Citadelleis, is co-operatively run, and accounts for one-third of the world’s maple production. Canada’s largest co-op, Mountain Equipment Co-Op, boasts a membership of over two million. Taken together, Canada’s credit unions are comparable in size to one of the big five banks. In its home turf, Vancouver City Savings Credit Union is as big as Scotiabank.
While employees in private enterprises may achieve some degree of control, such as that achieved through unions, in a co-op power unquestionably lies with the members, many of whom are employees. This heightened degree of control has obvious and significant benefits for the employees. This heightened degree of control has obvious and significant benefits for the employees. John Restakis of the BC Co-op Federation says, “Time and time again, studies show that the levels of worker satisfaction, motivation and productivity are higher in co-ops because people understand and know that they have much more control over their work, in terms of decision-making, how they design their work and how they deliver their work—that is enormously important in the operation of any business.”
Ian MacPherson of the BC Institute for Co-operative Studies at the University of Victoria points out that worker co-ops have better staying power than their traditional counterparts, “Worker co-ops have a ten-dency to survive better because the members will shoulder the problems and the losses for longer than if they were strictly employees,” he says. And indeed, in a study by the Quebec government of forestry co-operatives, the co-operatives were found to be twice as likely to succeed as private enterprises.
Beyond simply empowering the employees, however, co-operatives are dedicated to being accountable and responsible to social, economic, democratic and environmental issues in their communities. Most co-ops say they have multiple bottom lines, weighting environmental sustainability, local and international economic development and human rights along with profits.
“If you survey the general public, they’ll tell you they would rather choose a product that has a low impact on the ecology,” says Tom Webb of Saint Mary’s University Master of Management in Co-operatives and Credit Unions in Halifax. “For a co-operative this is simply good business. But in an investor-owned company you are not asked to look a year down the road, you’re being asked, what is your next quarter?”
“The way the current economic system works, there is tremendous pressure to pay low wages to cut wage costs, to cut benefits, to move from full-time to part-time, to produce offshore in China, to pollute,” he continues. “There’s tremendous pressure to cut wherever you can for the short run. And it’s difficult in this climate for business managers, no matter how good they are as people, to do the right thing. On the other hand, in a co-operative, it is a good deal easier. In fact, the expectation is that a co-operative manager will address other bottom lines. But that involves a whole new way of thinking.”
Co-ops are extremely diverse, ranging from the traditional farmer’s and fishery co-ops, housing, funeral services, and a variety of worker’s co-ops: The sex shop Come As You Are in Toronto is co-operatively run.