worker cooperatives for economic sustainability

7/30/2019 Worker Cooperatives for Economic Sustainability

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"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

*
http://social.un.org/coopsyear/key-messages.htmlhttp://social.un.org/coopsyear/key-messages.htmlhttp://social.un.org/coopsyear/key-messages.htmlhttp://social.un.org/coopsyear/key-messages.htmlhttp://social.un.org/coopsyear/key-messages.html


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Worker

Cooperatives

For Economic Sustainability


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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 perpetuallife, limited liability, and controlledby a Board of Directors elected by itsmembers.

Has certain structural

characteristics and guidingprinciples that set it apart from othercorporations.

The biggest difference being that acooperative is member-orientedrather than investor-oriented andoperates according to 7 core values.


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NY Code - Article 5-A:WORKER COOPERATIVE CORPORATIONS

N.Y. CCO. LAW 80 : NY Code - Section 80: Legislative findingsThe 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 enterprisesmay be democratically controlled and operated by their own workers. It is expected that suchcooperative ownership will result in increased job satisfaction and increased productivity and willenable 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 alleconomic sectors, will offer greater economic stability in the communities of this state and willdiscourage 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.


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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 andlivestock grazing systems.

Widespread poverty, unemployment, andgeneral social deterioration followed in thewake.


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History

The Rochdale Society of Equitable Pioneers1844

..Known for providing high quality, unadulterated goods.


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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


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Types of Cooperatives

Serviceo Finance, Utilities, Housing, Insurance, Media

Consumer (92%)

o Groceries/Food/Dry Goods, Hardware

Agriculture

o Production, Marketing

Worker (Only 1%)o ~ 300 democratic workplaces in the United States, employing over

3,500 people and generating over $400 Mil annual revenues.


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Currently.

Worldwide, nearly one billion people are cooperativemember-owners and at least 100 million of them areemployed by co-ops.

In America, around 30,000 cooperatives exist, withnearly 130 million members.

93 million credit union member-owners control $920billion in assets.


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What Do People Think?

Quality Co-op For-profit

Run their business in trustworthy manner 76% 61%

Have the best interests of customer in mind 74% 52% Committed to providing highest quality service 77% 64%

Provide products that are of high value 75% 70%

Can be counted on to meet customers need 79% 67%

Offer fair, competitive prices 77% 70%

National Cooperative Business Association (NCBA) and

Consumer Federation of America (CFA)

April 19, 2012


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History of Worker CoopsFor More: http://american.coop/node/142

From the Labor Movement to Current Economic InsecuritiesKnights 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 andmismanagement 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 - SocialismProfit-Making not Profit-Maximizing - Socialism


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History of Worker Coopshttp://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/


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Six Phases ofCooperative 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


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A Worker Coop is . . .

Joint Ownershipo Fair Wages

o Safe Workplace

o Healthy Environment

Democratic Controlo 1 Person, 1 Vote

o Patronage System

o

Surplus dividend according to contribution not investment

Member Benefit

o Owned and Run by Community Members

o Reinvestment in Neighborhood


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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 Managemento 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


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Key Decisions Cont.

General ManagementGraphics courtesy ofhttp://cultivate.coop/wiki/Worker_Cooperatives


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The Future

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

To authorize the Secretary of Housing and Urban Developmentto establish a national program to create jobs and increaseeconomic development in underserved areas by promotingcooperative development.

2013 2nd Annual NY Cooperative Network Summit

Saturday September 28, Syracuse, NY

Tip and Info Sheets for SBDC Advisors


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Q & A / COMMENTS

Frank Raymond Cetera

Basic Certified Business Advisor

Onondaga SBDC

800 North Salina St, Syracuse, NY 13208315-299-8228 x 12

[email protected]

worker cooperatives for economic sustainability

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