Each country has a cooperative law to regulate the operation of these entities.
Cooperative is a term that can be used as an adjective or as a noun . In the first case, it allows one to qualify that which cooperates : that is, that acts in favor of the purposes or intentions of someone or that proceeds together with another or others to achieve a common objective.
As a noun, the idea of a cooperative refers to a type of society that is established for the common utility of its members. These associations are organized democratically and are administered according to the agreement established by their members.
Etymological origin of the term cooperative
To know the meaning of the term cooperative, it is necessary to proceed to discover its etymological origin. In this case, it must be established that it derives from Latin, exactly from cooperativus , which can be translated as "who works together with others." This word is the result of the sum of three clearly differentiated parts:
- -The prefix co- , which is synonymous with "jointly" .
- -The verb operari , which can be translated as "to work" .
- -The suffix -tive , which is used to indicate a "passive or active relationship."
A mode of association
Cooperatives are autonomous entities of individuals who join together voluntarily with the intention of satisfying their economic, cultural and/or social needs through a jointly owned corporation, whose control is democratic . Unlike a company , in which there is always one or more owners, cooperatives do not have owners (or, put another way, all their members are the owners of the entity).
There are several cooperative principles that govern the operation of these entities. The associates, who can join and withdraw from the society voluntarily, have an economic participation . If a surplus is recorded, it belongs to the partners. Cooperatives, on the other hand, must work for the good of their community .
Collective ownership , shared benefits and self-management , therefore, are pillars of a cooperative. The associated workers make decisions in the members' assembly, which is often referred to as the development of an economic democracy .
Public service cooperatives can be responsible for supplying drinking water, gas or electricity, for example.
Advantages and disadvantages of cooperatives
It is important to know that cooperatives offer a long list of advantages over other types of companies. We are referring to benefits such as the following:
- The members that comprise it are only responsible based on the capital they contribute.
- They are allowed to enjoy certain bonuses and even tax exemptions.
- Members can register and cancel whenever they wish.
- The management of the cooperative is carried out in a safe, risk-free manner.
- The partners participate in an absolutely democratic manner in making all decisions.
- The information is very fluid and reaches all cooperative members.
- The cooperative is exempt from having to pay registration costs and does not even have to pay income tax.
Among the disadvantages, however, it is usually mentioned that decision-making tends to be delayed due to the need to reach agreements and that they often suffer difficulties in accessing bank credit .
A credit cooperative provides financing with its own capital to its members, charging reduced interest and offering facilities for repayment of the amount.
The cooperative
Cooperativism or cooperative movement promotes the association of consumers and producers as a mechanism to satisfy their needs and obtain benefits.
With global representation through the International Cooperative Alliance (a federation of cooperatives founded in 1895 ), cooperativism defends values such as solidarity, equity and mutual support. Beyond certain more distant antecedents, it is generally accepted that the cooperative movement was launched in 1844 thanks to a group of textile workers from Rochdale ( England ) who created a company that today would be defined as a cooperative.
The Rochdale Pioneers' Equitable Society was born when 28 workers lost their jobs following a strike . Faced with this reality, they decided to contribute 28 pence each to establish a new company managed democratically and with economic participation of the associates.
The history of cooperatives was soon nourished by the emergence of other associations of this kind, which gave rise to the so-called solidarity economy or social economy .
Under this form of economic organization, productive and distribution relations are based on solidarity, without having the profit motive as the guiding force.
Classification according to the type of cooperative
The production cooperative , the farmers cooperative , the consumer cooperative , the savings and credit cooperative , the transport cooperative and the education cooperatives are some of the different types of these associations.
Take the case of a cooperative of musical artists . Each one contributes in equal parts to the social capital for the formation of the entity, through which they produce and publish albums and organize concerts. Cooperative dividends are distributed equitably, since all musicians made the same contribution.
The Scottish publishing house AK Press , the Argentine bank Credicoop and the Spanish wineries Cristo de la Vega are examples of cooperatives.