December 2017

illustration), was part of a wider contribution to the
common good.
Last month’s edition of
the News featured extensive coverage of
how co-operatives today are having an impact
on their local communities. The Community
Impact Index provides evidence of what
co-operatives are doing under the seventh
principle, concern for community,
and it is good to see this celebration
of the vital contribution which societies make
to their communities. Co-operation wasn’t and
isn’t just for its members: it contributes to the
common good.
Furthermore, it isn’t just the contributions
to local good causes and emerging public services
which are paid out of surpluses. Or the 2.5%
levy for the education fund enabling people
to improve their own circumstances through
access to learning and development. The
very laws which enabled co-operative
societies to be formally registered
had built into them, and retain today, crucial
features which clearly separate co-operative
businesses from those trading for the benefit
of private investors.
None of these features existed in the company
law tradition under which most businesses
operate. While such businesses might also have
made generous contributions to charitable
causes and do so today, that was not part of their
core purpose, which was essentially focused on
generating shareholder value. Investor-owned
companies were and remain today enterprise for
private benefit. Co-operatives, we would argue,
are enterprise for the common good.
The outward-facing nature of co-ops is
clearly visible in the ICA Statement on the
Co-operative Identity, through open and voluntary
membership, the limits on interest on capital, the
commitment to education, co-operation amongst
co-operatives and concern for community. The last
three principles in particular, together with the
ethical values of social responsibility and caring for
others, firmly commit co-operation to an outwardlooking
dynamic, which clearly goes beyond
the direct interests of members, their families
and communities.
This is wonderfully captured in the background
paper to the 1995 ICA Statement where Dr Ian
MacPherson wrote: “Throughout its history, the
co-operative movement has constantly changed;
it will continuously do so in the future. Beneath
the changes, however, lies a fundamental
respect for all human beings and a belief in their
capacity to improve themselves economically and
socially through mutual self-help. Further, the
co-operative movement believes that democratic
procedures applied to economic activities are
feasible, desirable, and efficient. It believes that
u The commitment to one member one vote,
ensuring equality of access
to everyone
u The nature of co-operative capital, enabling
individual members to withdraw their funds
but without diminishing the value of reserves
for other members and future generations
u The mechanism for societies to merge
(transfer of engagements) which brings
co-operative businesses together for
the benefit of members, rather than as a
mechanism for extracting shareholder value.
democratically controlled economic organisations
make a contribution to the common good.
The 1995 Statement of Principles was based on
these core philosophical perspectives.”
It is interesting to note how societies today are
increasingly looking to distinguish themselves
from private corporate competitors by emphasising
not just their distinctive ownership and governance
arrangements, but their distinctive purpose. Look
at the home pages of leading societies today, and
you will see a high level of emphasis on member
ownership and control; on supporting and
responding to the needs of their local communities
and suppliers; and their commitment to
social purpose.
How things have changed from the days of
the Co-operative Commission in 2002, and
its recommendation to return to the focus on
social goals and the “virtuous circle” to drive
co-operative growth.
We have become so used to reading negative
stories about businesses, about their focus on u
q A copy of a Co-op
Workers Society shares
book from 1914
DECEMBER 2017 | 39