What is a co-operative?

    This document has been made available in electronic format
         by the International Co-operative Alliance ICA 
                         8 January 1996

                    What is a co-operative?

A co-operative is an autonomous association of persons united
voluntarily to meet their common economic, social, and
cultural needs and aspirations through a jointly-owned and
democratically-controlled enterprise.

Co-operatives are based on the values of self-help,
self-responsibility , democracy, equality, equity, and
solidarity.  In the tradition of their founders, co-operative
members believe in the ethical values of honesty, openness,
social responsibility, and caring for others.

The co-operative principles are guidelines by which
co-operatives put their values into practice.

1st Principle: Voluntary and Open Membership
Co-operatives are voluntary organisations, open to all persons
able to use their services and willing to accept the
responsibilities of membership, without gender, social,
racial, political, or religious discrimination.

2nd Principle: Democratic Member Control
Co-operatives are democratic organisations controlled by their
members, who actively participate in setting their policies
and making decisions.  Men and women serving as elected
representatives are accountable to the membership.  In primary
co-operatives members have equal voting rights (one member,
one vote), and co-operatives at other levels are also
organised in a democratic manner.

3rd Principle: Member Economic Participation
Members contribute equitably to, and democratically control,
the capital of their co-operative.  At least part of that
capital is usually the common property of the co-operative.
Members usually receive limited compensation, if any, on
capital subscribed as a condition of membership.  Members
allocate surpluses for any or all of the following purposes:
developing their co-operative, possibly by setting up
reserves, part of which at least would be indivisible;
benefiting members in proportion to their transactions with
the co-operative; and supporting other activities approved by
the membership.

4th Principle: Autonomy and Independence
Co-operatives are autonomous, self-help organisations
controlled by their members.  If they enter into agreements
with other organisations, including governments, or raise
capital from external sources, they do so on terms that ensure
democratic control by their members and maintain their
co-operative autonomy.

5th Principle: Education, Training and Information
Co-operatives provide education and training for their
members, elected representatives, managers, and employees so
they can contribute effectively to the development of their
co-operatives.  They inform the general public - particularly
young people and opinion leaders - about the nature and
benefits of co-operation.

6th Principle: Co-operation Among Co-operatives
Co-operatives serve their members most effectively and
strengthen the co-operative movement by working together
through local, national, regional, and international

7th Principle: Concern for Community
Co-operatives work for the sustainable development of their
communities through policies approved by their members.

                         - * -

This Statement on the Co-operative Identity was adopted at the
1995 Congress and General Assembly of the International
Co-operative Alliance, held in Manchester to celebrate the
Alliance's Centenary. Recommended to the Congress by the ICA
Board, the Statement was the product of a lengthy process of
consultation involving thousands of co-operators around the
world. The process was chaired by Ian MacPherson of Canada,
who prepared numerous drafts of the Identity Statement and its
Background Paper in an effort to understand the state and
needs of the co-operative movement at the end of the twentieth
century. He was assisted by a Resource Group that included
Raija Itkonen
from Finland, Hans Munkner from Germany, Yehudah Paz from
Israel, Masahiko Shiraishi from Japan, Hans-Detlef Wulker from
Germany and Bruce Thordarson, Director-General of the ICA.