PRINCIPLES OF CO-OPERATION

DEFINITION OF CO-OPERATION

Ho Calvert: “Cooperation is a form of organization in which persons voluntarily associate together as human beings on the basis of equality for the promotion of economic interest of themselves”.

DEFINITION OF CO-OPERATIVE SOCIETY

Co-operative society is defined as “a union of persons established according to the principles of equality, the purpose is to improve the financial position of its members by joint performance, provided that all profits made, aims to distribute among members and not in proportionate to investment”

OBJECTIVES OF CO-OPERATION
1. The members should be prepared to work in a sprit of cooperation.
2. There should be equality in all respect.
3. There should be no exploitation.
4. There should not be any political influence.
5. There should not be any regimentation.
6. There should be no loss of initiative.
7. Capital should not be allowed to dominate.
8. Both producer and consumers should feel satisfied.

PRINCIPLES OF CO-OPERATION
Mr. Watkiw: “Co-operative principles are the ideas inherent in co-operation, which determine what is the mode of action”.

1.     Rochdale Principles
In 1997, ICA declared the following principles as Rochdale Principles:
1. Main Principles 2. Secondary Principles
- Open and voluntary membership - Equal rights to all irrespective of cast, religion etc.
- Limited interest on capital - Neutrality in political and religious matters
- Democratic management - Cash transaction
- Cooperation among cooperators - Limited responsibility
- Cooperative education - Publicity and propaganda
- Distribution of surplus - Thrift and Savings

2.     Reiffeisen Principles
In order to provide relief to agricultural workers in Germany, Reffeisen started agricultural societies in 1862. He proposed the following principles:
1. All should be accepted as a member
2. Members should be on voluntary services
3. Assistance should be given to members
4. Liability should be limited
5. Area of operation should be limited
6. Should follow the principle of self-help
7. Surpluses should be used for services

3.     ICA (International Co-operative Alliance) Principles

1. *Voluntary and Open Membership: The membership is based on the concept of people willing to accept responsibility of membership without general, social, racial, political or religious discrimination.

2. Limited Interest on Capital: Capital is an instrument of production and like any other item it is entitled to receive a fair remuneration. In a cooperate economy, capital cannot dominate but has to serve in return for a fixed remuneration or a limited interest. This principle shows that the co-op movement seeks to neutralize the disparities caused by ownership of capital and seeks to eliminate the profit motives.

3. Democratic Management: Co-ops are democratic organizations; they are managed and controlled by their own members. In a co-op, members have equal voting rights, i.e. they follow the principle of “One Member One hand”.

4. Cooperation among Co-operatives: Co-ops strengthen their movement by working together through local, regional, national and international structures.

5. Cooperative Education: Co-ops provides various types of management training programmes to their members and employees so that they can contribute to the development of their co-ops.

6. Member’s Contribution: Members contributes equally to capital contribution and receive limited compensation depending upon their contribution. They allocate surpluses as development fund for their co-ops.

7. Autonomy and Independence: Being self-helped organization, co-ops are controlled by their members. In case they enter into agreement into other organization including the government, they maintain the co-operative autonomy.

8. Concern for Community: The co-ops work for the sustainable development of their communities.