Seven Cooperative Principles
On December 21, 1844, a tiny retail store in Rochdale, England opened its doors to business. This store was organized by financially strapped workers of nearby factories and was operated on a series of principles that eventually became the foundation for cooperative business practices everywhere. Jackson Electric Cooperative is governed by the following seven principles:
- Voluntary and Open Membership. Cooperatives are voluntary organizations, 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.
- Democratic Member Control. Cooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Representatives are elected from the cooperative membership to serve on the Board of Directors. In Jackson Electric Cooperative, members have equal voting rights, with one vote per member.
- Member Economic Participation. Members contribute equitably to and democratically control the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. They 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 the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.
- Autonomy and Independence. Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
- Education, Training, and Information. Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They inform the general public, particularly young people and opinion leaders, about the nature and benefits of cooperation.
- Cooperation Among Cooperatives. Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.
- Concern for Community. While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by members.
Six principles have guided cooperatives for the past 30 years. The number of principles increased to seven as the result of a vote taken by the General Assembly of the International Cooperative Alliance in Manchester, England, on Sept. 23, 1995. The goal of the new principle is to better reflect the needs of cooperative members in today's society.