Historical Perspective of the Cooperative Movement


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CDA Trainers' Training for Cooperatives
Aug 29-31, 2012

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Historical Perspective of the Cooperative Movement

  1. 1. Jo B. BitonioPresenterCooperative Trainers Training, Lingayen, PangasinanAug. 29-31,2012)
  2. 2. Key TheoristsRobert OwenWilliam KingThe Rochdale PioneersCharles FourierCharles GideBeatrice WebbFriedrich Raiffeisen
  3. 3. Robert Owen(1771–1858) OWEN first cooperative theorist and credited with inspiring the Rochdale Pioneers, who in 1844 began the cooperative movement at Rochdale, Lancashire
  4. 4. It was here thatthe first co-operative storewas opened.
  5. 5. Dr. William King (1786–1865) Although Owen inspired thecooperative movement, others –such as– Dr William King took hisideas and made them moreworkable and practical.King believed in starting small, andrealized that the working classeswould need to set upcooperatives for themselves, sohe saw his role as one ofinstruction.
  6. 6. Charles FourierCharles Fourier should alsobe mentioned as animportant influence.Beliefs-Fourier believed that poverty was thereason for disorder socially and economically.The main goal of Fourier was to create asociety in which the people worked together,both rich and poor, to create a socialeconomy that was profitable and also savedtime and labor for the citizens. By uniting allpeople regardless of economic status,Fourier hoped to eliminate the poverty thatwas stunting the success of social economy..Just like pleasure needs variety, so did work.Fourier believes that the people shouldconstantly switch roles and have variety intheir work which produces the best result.
  7. 7. Beatrice Webb was the author of TheCo-operative Movementin Great Britain (1891).
  8. 8. The Rochdale PioneersIn modern form, cooperatives date from 1844, then a group of 28 impoverished weavers of Rochdale, England, founded a mutual-aid society, called the Rochdale Society of Equitable Pioneers.
  9. 9. • The successful example of cooperative business provided by the Rochdale Society, which also established between 1850 and 1855 a flour mill, a shoe factory, and a textile plant, was quickly emulated throughout the country.
  10. 10. Rochdale Principles in 1844, which havebeen highly influential throughout thecooperative movement.(1) democratic control, with each member entitled to only one vote, regardless of the number of his or her total shares;(2) membership open to all, irrespective of race, creed, class, occupation, or political affiliation;(3) payment of limited interest on invested capital;(4) distribution of net profits, usually called savings or earnings, to cooperative members in proportion to the amount of their patronage.
  11. 11. Supplemental Principles The Rochdale Society developed a number ofsupplemental principles, which are generally observedin contemporary consumer cooperatives. According tothese: a. part of cooperative earnings are utilized to expand operations b. non-members may become members by letting their share of net profits be applied towards their initial share stock;
  12. 12. Supplemental Principlesc. goods and services are sold for cash at prevailing market prices; reserve funds are regularly accumulated for the purpose of covering depreciation and meeting possible emergencies;d. educational activities, designed to increase and inform the cooperative membership, are systematically sponsored and conducted.e. Other supplemental principles hold that labor must be fairly treated and that cooperatives should work together
  13. 13. UK, France, Germany, Belgium, Austria, Italy, Denmark , Finland, Norway, and Sweden.
  14. 14. According to cooperative economist Charles Gide, the aim of a cooperative wholesale society is to arrange “bulk purchases, and, if possible, organize production.”Cooperative Wholesale Society
  15. 15. Friedrich Wilhelm Raiffeisen Raiffeisen conceived of the idea of cooperative self-help during his tenure as the young mayor of Flammersfeld. He was inspired by observing the suffering of the farmers who were often in the grip of loansharks. He founded the first cooperative lending bank, in effect the first rural credit union in 1864.
  16. 16. Euros 1.3 B consumers Whole workers leisure care buying foodsEuros 11B agriculture Credit union housing health Football clubSource: doctorMr. Bob BurltonMidcounties Co-operative, United KingdomAug. 2006
  17. 17. The largest cooperatives came from 28 countries 15 4 6Europe 1 15 1USA 4Asia 6 1Australia 1New Zealand 1Israel 1 28
  18. 18. Comparable to the GDP of the world’s 9th largest economySource: ICA:2010
  19. 19. The InternationalCooperative Alliance(ICA), the body thatrepresents and servescooperativesworldwide, reportsthat there are overone billion peoplearound the globe whoare members ofcooperatives. Largesegments of theworld’s population aremembers ofcooperatives
  20. 20. World Cooperative Movement it is estimated that cooperatives employ some 100 million people.Source: www.slideshare.net/jobitonio
  21. 21. . Asia has 45.3 millioncooperative members. InIndonesia, 27.5% of familiesare members of cooperatives.In Japan, 33% of families aremembers of cooperatives. InSingapore, 50% of thepopulation are members ofcooperatives. People haveopted for the cooperative waybecause of the benefits andadvantages that they derivefrom their membership in thecoop.Source: (Ping-Ay: 2011)
  22. 22. Source: www.slideshare.net/jobitonio
  23. 23. To the GDP of the world’sninth largest economy Source: ICA:2010
  24. 24. Source: ICA:2010
  25. 25. Source: ICA:2010
  26. 26. Source: ICA:2010
  27. 27. 2. Banking/Credit Union
  28. 28. Source: ICA:2010
  29. 29. Source: ICA
  30. 30. 4. Insurance
  31. 31. Source:ICA:2010
  32. 32. Insurance
  33. 33. 5. Workers/Industrial Sea France Workers Cooperative
  34. 34. Workers, Industrial, Artisanal and Service ProducersSource ICA:2010
  35. 35. 6. HealthThe International Health Co-operative Organization(IHCO) unitesco-operatives within the ICAmembership that:provide health care totheir members;provide self-employmentfor health professionals(doctors, nurses, etc.);integrate consumers’ andproducers’ co-operatives
  36. 36. HealthICA (2010) cited some examples asfollows:US health reform, which includes theCO-OP programme, focused on promotingco-operative health service providers;collaboration between health co-operatives and the Japanese government to improve health care andto develop prevention measures;the concession model implemented inSpain that transfers managing some publichospitals and health centres to health co-operatives.
  37. 37. 7. Fisheries ICFO report The fisheries sector, which includes aquaculture, is crucial tofood security, poverty alleviation and general well-being. In2008, the world consumed 115 million tonnes of fish, anddemand is expected to rise. Fish and fishery products are a vitaland affordable source of food and high-quality protein(ICA:2010).
  38. 38. Fisheries ICFO report In 2008, fish as food reached an all- time high of nearly 17 kg per person, supplying more than three billion people with at least 15 percent of their average animal protein intake. In recent years, fishermen have suffered from various difficulties, such as lack of education, dangerous fishing environments and diminishing catch sizes caused by overfishing and climate change (ICA:2010).
  39. 39. 8. Housing The recent global financial crisis had a powerful impact on housing markets around the world. Construction, which depends on capital investment, suffered as the capital markets dried up, property values fell and governments cut back on the financial assistance they provided for affordable housing. While many co-operative housing developers/providers reduced their development programs from lack of capital finance or to reduce exposure to adverse market conditions, established housing co-operatives proved to be resilient to the crisis, according to Mr David Rodgers, President of ICA Housing.
  40. 40. Source: ICA :2010
  41. 41. India
  42. 42. Success Stories in India• Milk• Fertilizer• Sugar• Thrift & credit• oilseed
  43. 43. Amul Dairy co-ops in India represent a model to the development program termed “white revolution” since 1965 that accomplished economy of scale by collecting milk from hundreds of thousands small farmers breeding few cattle and thus contributing to the enhanced living standard Source: Akira Kurimoto
  44. 44. The most cherishedexpectation of membersfrom their coops is NOTcash alone but timely andadvantageous marketingof their products, timelysupply of credit, qualityseeds, farm chemicals,fertilizers and extensionservice
  45. 45. Malaysia4,771 co-operativewith a totalmembership of 5.5 Mmembers. Thisrepresents about 5%of Malaysia’s totalpopulation with atotal fund of RM 6.06B with a total assetof RM 25.7 B
  46. 46. • 8 types of coops: banking, housing,consumer, transportation, agriculture, small-medium industry, development & service• The CBs give financing other activitiesincludes pawn broking, investment & insurance• The co-operative housing society in Malaysiaare actively developing houses and prices ofhousing are generally lower than the marketplace
  47. 47. • The consumer co-operative operates groceryshops, supermarket, petrol stations and otherconsumer goods• Transport coops bring agriculture productslike oil palm, rubber products.• Agriculture based co-ops produce oil palm,rubber, cocoa and vegetables• Small medium industry co-ops producehandicraft like silverware, ceramics, furniture
  48. 48. Japan
  49. 49. Agricultural Cooperative Organization (JA)• system is unique & high tech (high level value-addition)• strong agri coop movement• all farmers in membership• strong federal in character• amalgamation for viability (in progress)• service is important from cradle to grave• strong structural adjustments• strong strategic alliance
  50. 50. Activities of JA Group Organization• JA Chuoukal - guidance• JA Zenchu guidance• JA Shinren credit business• Norinchukin Bank credit business• JA Keizairen purchasing & marketing related business• JA Zen-noh purchasing & marketing related business• JA Kyosairen mutual insurance business• JA Kosairen welfare business• JA Zenkoren welfare business• Nihon Nogyo Shimbun newspaper related information service• JA Shinmbunren newspaper related information service• ie-no Hikari Kyoki publication, educational and cultural activities• Nokyo Kanko travel businessSource:Mr. Toru NakashimaInstitute for the Development of Agicultural Cooperation in Asia (IDACA)August 2006
  51. 51. Korea
  52. 52. Shirk San Kei• Village-level cooperative• Acts to market collectively farm products• Collective agency• Coops are multi-purpose• The apex aside from agricultural financing are engage in international banking and non-bank operations such as: marketing, purchasing, insurance and research
  53. 53. Fig. 1. Coin Street Community Builders’ Oxo Tower building containing shops, restaurants and a housing co-operativeWestern Coop Residence
  54. 54. Consumers Coop in Japan & Korea• The coops introduced computer read order sheets and settlement through members bank accounts to reduce chores. It is successfully evolving to delivering to households to cope with increasing individualism (Kurimoto)
  55. 55. Taiwan
  56. 56. Farmers Association• Obtain credit• Buy their farm supplies• Market their produce• Manages irrigation system• Processes and exports agricultural products• Pays salaries of extension workers
  57. 57. Thailand
  58. 58. Thai Agricultural CoopsSource: www.slideshare.net/jobitonio
  59. 59. Agricultural cooperativesare engaged in business in response tomembers’ need in five areas:• credit business• savings & deposits• purchasing business• marketing business• agricultural services
  60. 60. Types of Agricultural Cooperatives1. Water Users Cooperative2. Land Reform Coop3. Special Cooperative (animal raising)4. National Security Command Cooperative (police border patrol)5. Rubber Cooperative6. Integrated Farming (vegetables/animal raising)7. Dairy Cooperative
  61. 61. SingaporeNational CoopFederation 74 coopsclassified as:campus coop sector,credit coop sector,NTUC co-op sector,service co-op sectorcombinedmembership of 1.6 M
  62. 62. Campus Co-ops• comprised of secondary schools, junior colleges, Institute of technical Education (ITEs), polytechnics and universities• sales of books, stationary, running a bubble- tea café, cybercafés, thrift and loan services• bazaar competition to put on their thinking spirit• Biz Challenge Simulation Game
  63. 63. Supermarket Chain• own central warehousing & distribution center•ventured into new formats and services such as:Liberty Market, Cheers Convenience Store, ThePassar, Bakers Corner, Homemart and Cybermart•invested in real time integrated warehousemanagement system to achieve better inventorycontrol and streamline orders from operations so asto maximize goods deployment procedures andimprove staff efficiency.
  64. 64. Fair Price coop has been successful in developing super markets and secured a dominant position in food retailing
  65. 65. SeaCare• SeaCare has its own family of businesses that focused on job creation for displaced/unemployed seamen as well as enhancing and growing business opportunities in the maritime industry• Expanded its business to Australia, China, Indonesia, Malaysia & Philippines• Ventures are: ship management, maritime medical centres, HR agency for seafaring and nonseafaring personnel, commercial cleaning and maintenance services.
  66. 66. CC/CBs are proliferating in Korea, Philippines,Malaysia, Thailand, India, Sri Lanka, Australia etc.(Kurimoto)
  67. 67. University CoopsUniversity Coops in Asia present a unique model of development. They are prevalent in the Japan, Korea, Philippines, Vietnam, Thailand, Malaysia, Singapore, India, etcThe coops provide both professors and students meals, appliances, books, credit, insurance,
  68. 68. Health Coops BrazilHealth coops are organized by consumers ( Japan, Korea, Philippines and Singapore) and or professional ( Malaysia, India, Sri Lanka, and Nepal).They are providing a vital role in health services at hospitals and clinics and related services in the different socio economic and institutional settings Source: Kurimoto
  69. 69. Women Coops Nepal IndiaWomen coops organized exclusively by women to empower women leaders in Korea, Malaysia, India, Iran, etc.Reasons for organizing women coops are varied: to avoid male domination in mixed membership, religious norm of gender segregation, feminist movement, Source: Kurimoto
  70. 70. ReferenceStefano Zamagni & Vera Zamagni Cooperative Enterprise: facing the Challenge of Globalization. Published by Edward Elgar Publishing Limited. The Lypiatts, UKCo-op News. The Global New Hub for Cooperatives Aug 27, 2012ICA Report Global 300: 2010
  71. 71. ReferenceAkira Kurimoto Current State of Cooperative Research in Asia and Future• http://www.un.org/esa/socdev/social/meetiAugust 29, 2012http://www.un.org/esa/socdev/social/meetings/egm ngs/egm11/documents/Kurimoto%20-11/documents/Kurimoto%20-%20Current%20State %20Current%20State%20of%20of%20Cooperative%20Research%20in %20Cooperative%20Research%20in%20Asia.pdf %20Asia.pdfJo Bitonio History of the Cooperative Movementwww.slideshare.net/jobitonio