What Is a Co-op?
Co-operatives (or "co-ops") are legally incorporated organizations owned by their members who use their services or purchase their products. Co-ops can provide virtually any product or service, and can be either non-profit or for-profit enterprises. The co-operative sector keeps dollars circulating within the local economy, provides secure employment and is a means to revitalize and sustain healthy communities.
Here's a great definition of what a co-operative is:
Co-operatives are community-focused businesses that balance people, planet and profit. Co-ops are democratic and value-based, formed to seize local opportunities and meet the needs of their member-owners. They are legally incorporated business enterprises. As a trusted place to do business, co-operatives are chosen by more than 1 in 7 people worldwide. Twice as many co-ops remain in operation compared to other forms of business enterprise after 10 years.
There are 1,300 independent and autonomous co-operatives in Ontario, with 1,900 locations in 400 communities.
CLASSIC DEFINITION: According to the classical definition of a co-operative as set out by the International Co-operative Alliance (ICA), 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." The symbol of the co-operative movement is the COOP Identity and Marque, a symbol used by many organizations and countries throughout the world.
As its name implies, a co-operative is people coming together to meet a common need. Possessing a high degree of collective entrepreneurship, the co-operative business enterprise model is inherently ethical in its treatment of its members, employees, suppliers and the environment. Co-ops serve a range of sectors, including housing, food, worker, agriculture, service, financial, youth, aboriginal and community. Co-operatives can be "for profit" or "not-for-profit." (Ontario co-op legislation refers to these co-ops as 'share capital' and 'non-share-capital'.)
Check out the 'related pages' section at right to learn more, including why twice as many co-ops remain in operation compared to other forms of business enterprise after 10 years.
A BUSINESS MODEL: A co-operative is actually a form of business enterprise that can be used as a corporate vehicle—much like any other type of business corporation —in all sectors of the economy. The co-operative model uses its unique form of business enterprise to accomplish social and policy ends. As such, co-operatives and the co-operative model are optimal for the delivery of service in the social economy.
Co-operatives face similar problems to traditional investor-driven firms: concentration, globalization, organizational and technical change, and the changing needs of clients. However, co-operatives also face particular challenges due to their specific nature as democratically controlled organizations providing equitable economic benefits to their members. To be successful, co-operatives must be competitive while maintaining their special nature as businesses that are user-driven, democratically owned and managed by their members.
PEOPLE, PLANET, PROFIT: Success is not only defined as profitability, but by other yardsticks as well—such as the improved well-being of the members and the communities where they live (often called the triple bottom line). The key organizational distinction between a co-operative enterprise and other corporate structures is democratic participation through a "one-member, one-vote" process. In a traded company, shareholders are entitled to as many votes as they hold shares. Each member of a co-op is entitled to one vote regardless of level of investment. No single member can take control of a co-operative. Decisions are made by the majority, on the theory that communities and memberships ultimately know what is best for them.
Another key distinction is that business corporations are mandated by law to provide shareholder value - the pursuit of profit. They generally must continue to grow and/or cut costs to provide shareholder returns. Co-operatives are owned by their members, not external shareholders. While they also provide value to their members, a co-op's primary responsibility is to meet their members' needs.
MEMBERSHIP: Co-ops are democratic, member-owned organizations. They are responsible to their own members. The members determine how the co-op will be run, elect the Board of Directors and allocate the profits of the co-operative amongst its member-owners.
FACTS AND STATS
- Ontario co-ops provide more than 15,500 jobs (FTE), have $3 billion in assets and produce $2.1 billion in revenue.
- Ontario co-operatives are owned by more than 1.4 million members and utilize about 49,000 volunteers including 10,000 board members.
- On average, more than 30 new co-operatives are incorporated in Ontario every year. 47 were incorporated in 2011, and 64 were incorporated in 2012!!
- There are more than 9,000 co-ops in Canada, with more than 18 million members. Canadian co-ops (including credit unions) have more than $252 billion in assets. More on Canadian co-ops here.
- Co-ops operate in more than 90 countries worldwide. They employ more than 100 million people and have 1 billion members.
- The co-operative sector controls over $275 billion in assets worldwide.
- The world's 300 largest co-operatives, nine of which are Canadian, have an aggregate turnover of $US 1.1 trillion, the size of the 10th largest economy in the world.
- Co-op brand names include Nordica cottage cheese, Sunkist, Welchs, Green Bay Packers, Sealtest, Ocean Spray and Blue Diamond.
- More than 2 out of 3 Canadians agree that co-ops are a trusted place to do business.
- Co-operatives are part of the Social Economy, and most co-ops are considered social enterprises. Get more information on co-ops and the social economy from the downloads link at right.
Download the Ontario Co-ops facts and stats FactSheet (What is a Co-op) from the "Downloads" section at right to learn more.
- Browse the entire series of FactSheets, by clicking on the "For More Information" link at the bottom of this page, or click here to see a listing of the complete FactSheet series by title.
- Browse all of the data, summaries and presentations relating to the 2007 Survey and Census of Ontario co-operatives here or see the link under "For More Information" to the right.
- View a poster entitled 'Co-ops Work', that contains a series of facts and figures on Ontario co-ops from the 'Related Documents' at right.
- Download a feature on co-operatives from The Globe and Mail, May, 2012 from the area at right.
WHY CO-OPERATIVES ARE IMPORTANT TO THE ONTARIO ECONOMY
Ontario’s 1,300 co-operative business enterprises should play a central role in Ontario in building a more resilient and equitable economy that is not only economically sustainable but socially just.
Co-operatives operate in almost every sector of the Ontario economy and are poised to partner with government to provide cost-effective, local services in a wide variety of areas including finance (banking and insurance), transportation, social services, renewable energy, resource management, telecommunications, retail services and child care. As such, these legally-incorporated, community-based businesses should be included in municipal, regional and provincial policy discussions.
Co-operatives are community-focused businesses that balance people, planet and profit. Co-ops are democratic and value-based, formed to seize local opportunities and meet the needs of their member-owners. As a trusted place to do business, co-operatives are chosen by more than 1 in 7 people worldwide. Twice as many co-ops remain in operation after ten years as other types of business enterprise.
Co-ops exist in virtually every sector of the economy, from agriculture and local food, retail and financial services, to housing, manufacturing, child care, funeral services and renewable energy.
Co-ops can be large businesses (think of The Co-operators, Gay Lea Foods or Mountain Equipment Co-op), medium sized operations (your local credit union, Community CarShare, or Ag Energy Co-operative), or small businesses (your local child care co-op, Sleepless Goat Cafe or Aron Theatre).
There are 1,300 co-operatives, credit unions and caisse populaires in Ontario, operating 1,900 locations in 400 communities. Ontario’s non-financial co-ops have more than $30 billion in assets and $2.1 billion in revenue. The sector is owned by more than 1.4 million members, and is supported by 49,000 volunteers. The co-operative business model is almost 170 years old and is utilized in 100 countries.