"Cooperative Enterprises Build A Better World "

Cooperatives empower people Cooperatives improve livelihoods and strengthen economies Cooperatives enable sustainable development Cooperatives promote rural development Cooperatives balance both social and economic demands Cooperatives promote democratic principles Cooperatives and gender: a pathway out of poverty Cooperatives: a sustainable business model for youth

"..the key aspects of cooperative enterprises which allow them to fulfill this rule." - http://social.un.org/coopsyear/key-messages.html

Worker Cooperatives

For Economic Sustainability

Legal Business Entity? Yes.

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.

A corporation (or LLC) with perpetual life, limited liability, and controlled by a Board of Directors elected by its members. Has certain structural characteristics and guiding principles that set it apart from other corporations. The biggest difference being that a cooperative is member-oriented rather than investor-oriented and operates according to 7 core values.

NY Code - Article 5-A: WORKER COOPERATIVE CORPORATIONS

N.Y. CCO. LAW 80 : NY Code - Section 80: Legislative findings
The legislature hereby finds and declares that it is the policy of this state to promote the creation of worker cooperatives. Worker cooperatives provide a means by which enterprises may be democratically controlled and operated by their own workers. It is expected that such cooperative ownership will result in increased job satisfaction and increased productivity and will enable workers to receive the fullest economic benefits from their endeavors. It is also expected that the establishment of cooperatives under this article will result in the creation of new jobs in all economic sectors, will offer greater economic stability in the communities of this state and will discourage the movement of capital and jobs out of this state.

A means for democratic control and operation by owners Increased job satisfaction, productivity, and fullest economic benefit Creation of new jobs in all economic sectors Greater economic stability to communities by preventing movement of capital and jobs out of state.

The Instigation

The Industrial and Agricultural Revolutions Factory mass production outpaced and undersold cottage industry production. Farmers driven from their land due aggregation of property from modernized cultivation and livestock grazing systems. Widespread poverty, unemployment, and general social deterioration followed in the wake.

History

The Rochdale Society of Equitable Pioneers 1844

..Known for providing high quality, unadulterated goods.

The 7 Cooperative Principles

1st Principle: Voluntary and Open Membership 2nd Principle: Democratic Member Control 3rd Principle: Member Economic Participation 4th Principle: Autonomy and Independence 5th Principle: Education, Training, and Information 6th Principle: Cooperation among Cooperatives

7th Principle: Concern for Community

Types of Cooperatives
Service
o Finance, Utilities, Housing, Insurance, Media

Consumer (92%)
o

Groceries/Food/Dry Goods, Hardware

Agriculture
o

Production, Marketing
~ 300 democratic workplaces in the United States, employing over 3,500 people and generating over $400 Mil annual revenues.

Worker (Only 1%)

o

Currently.

Worldwide, nearly one billion people are cooperative member-owners and at least 100 million of them are employed by co-ops. In America, around 30,000 cooperatives exist, with nearly 130 million members. 93 million credit union member-owners control $920 billion in assets.

What Do People Think?

Quality

Co-op
76%
74%

For-profit
61%
52% 64% 70% 67%

Run their business in trustworthy manner

Have the best interests of customer in mind

Committed to providing highest quality service 77% Provide products that are of high value Can be counted on to meet customers need 75% 79%

Offer fair, competitive prices

77%

70%

National Cooperative Business Association (NCBA) and Consumer Federation of America (CFA) April 19, 2012

History of Worker Coops

For More: http://american.coop/node/142

From the Labor Movement to Current Economic Insecurities

Knights of Labor 1869-1949 1970's Phenomenon Argentine Financial Collapse 1990's Worker Cooperative Code of Governance, UK 2006 Current Economic Depression: Stock market volatility, anger at banks for bailouts and mismanagement of funds, distrust of high-earning CEOs and income gap/inequalities.

Cuba's New Cooperatives Law

Rooted Within Several Intellectual and Political Philosophies. Alleviation of Workplace Alienation - Marxism Participatory Economics - Democracy Autonomy and Self-Control - Anarchism Cooperation with Other Worker Coops - Mutualism and Democracy Equitable Distribution - Socialism Profit-Making not Profit-Maximizing - Socialism

History of Worker Coops

http://american.coop/node/142

Federations and Organizations

The US Federation of Worker Cooperatives - http://www.usworker.coop

Conferences and events, resource referrals, and networking and training opportunities.
The National Cooperative Business Association - http://www.ncba.coop/ncba/home Eastern Conference for Workplace Democracy - http://east.usworker.coop/ The premier gathering of worker cooperatives in the Eastern region. 2013, "Growing Our Cooperatives, Growing Our Communities: Democratic Community Economic Development Through Worker Ownership" NY State Cooperative Network - http://www.cny.coop/ For cooperative Businesses and Economic Development

Cooperative Development Institute - http://www.cdi.coop/ Northeast's center for cooperative business education, training and technical assistance.
Blogs American Worker Cooperative - http://www.american.coop/ Grassroots Economic Organizing - http://www.geo.coop/

Six Phases of Cooperative Development

I. Identifying an opportunity II. Building consensus on potential for cooperative III. Developing trust among potential members IV. Securing member commitment

V. Involving other stakeholders

VI. Starting up the cooperative

A Worker Coop is . . .

Joint Ownership
o o o

Fair Wages Safe Workplace Healthy Environment

Democratic Control
o o o

1 Person, 1 Vote Patronage System Surplus dividend according to contribution not investment

Member Benefit o Owned and Run by Community Members o Reinvestment in Neighborhood

Key Decisions

Governance o Board (collective if all owners are on Board) o Not all worker's have to be Member-Owners o Path to Membership / Fluctuating Labor Needs o How often will the membership at-large meet (must be at least annually?) Financing o Member Equity Contributions (Buy-In or Loans from Personal Savings) o Loans, Micro-Loans o Other Alternatives (Crowdfunding, Pre-sales/CSA Model, Donations)

Surplus Management o How much is retained versus paid out per year? o How are shares transferred? How is patronage paid out? Over what period? o Return of Equity for Leaving Members

Key Decisions Cont.

General Management
Graphics courtesy of http://cultivate.coop/wiki/Worker_Cooperatives

The Future
National Cooperative Development Act http://www.govtrack.us/congress/bills/112/hr3677

To authorize the Secretary of Housing and Urban Development to establish a national program to create jobs and increase economic development in underserved areas by promoting cooperative development.

2013 2nd Annual NY Cooperative Network Summit Saturday September 28, Syracuse, NY

Tip and Info Sheets for SBDC Advisors

Q & A / COMMENTS
Frank Raymond Cetera Basic Certified Business Advisor Onondaga SBDC 800 North Salina St, Syracuse, NY 13208 315-299-8228 x 12 ceteraf@sunyocc.edu