Report of the ICA Commission on Co-operative Principles (1966)

Recommendations and Conclusions

(... continued ... )

Summing up the Commission's examination in Part II of this report of the seven Principles enumerated in the Report of 1937, it may be said that the following should continue to be considered as essential to genuine and effective co-operative practice both at the present time and in the future as far as that can be foreseen:

1. Membership of a co-operative society should be voluntary and available without artificial restriction or any social, political or religious discrimination, to all persons who can make use of its services and are willing to accept the responsibilities of membership.
   
   
2. Co-operative societies are democratic organisations. Their affairs should be administered by persons elected or appointed in a manner agreed by the members and accountable to them. Members of primary societies should enjoy equal rights of voting (one member, one vote) and participation in decisions affecting their societies. In other than primary societies the administration should be conducted on a democratic basis in a suitable form.
   
   
3. Share capital should only receive a strictly limited rate of interest, if any.
   
   
4. Surplus or savings, if any, arising out of the operations of a society belong to the members of that society and should be distributed in such manner as would avoid one member gaining at the expense of others.
   
   
5. This may be done by decision of the members as follows:
   
   a) By provision for development of the business of the co-operative;
   
   b) By provision of common services; or,
   
   c) By distribution among the members in proportion to their transactions with the society.
   
   
6. All co-operative societies should make provision for the education of their members, officers, and employees and of the general public, in the principles and techniques of Co- operation, both economic and democratic.
   
   To these we have though it important to add a principle of growth by mutual co-operation among co-operatives:
   
   
7. All co-operative organisations, in order to best serve the interests of their members and their communities, should actively co-operate in every practical way with other co- operatives at local, national and international levels.

In submitting the above formulation, the Commission would add certain remarks. The first is that these principles are not associated arbitrarily or by chance. They form a system and are inseparable. They support and reinforce one another. They can and should be observed in their entirety by all co-operatives, whatever their objects and area of operations, if they claim to belong to the Co-operative Movement. The second remark is that, although the principles originated as rules governing the relations of the individual members of co-operatives with one another and with their societies, their application is not confined to primary societies. They should be loyally observed by institutions which represent the co-operation of co-operative societies rather than of individual persons. The third remark is that those principles, accepted in 1937 but not retained by the Present Commission, are not lightly to be disregarded or thrown aside. The fact that they are not universal application in our time does not mean that they are no longer appropriate, particularly for co-operative societies which, by reason of their youth and experience, cannot afford to risk strains on either their finances or the unity of their membership.

Returning to the co-operation of co-operative societies in associations variously termed as unions, federations, central organisations or, more broadly, secondary organisations, serving all kinds of economic, technical and educational purposes, the Commission would point out that this co-operation of the second degree is playing in the Co-operative Movement today, and is destined to play in the future, a much more important role than hitherto. It represents, of course, no more than a natural and beneficial extension of the fundamental co-operative idea of association for mutual benefit. It is often the method by which Co-operation advances from one stage of the productive process into the next, as for example, from retailing into wholesaling and production, or from selling on a home market into exportation. Secondary organisations, if they operate at first on a district or regional basis eventually grow or coalesce into national organisations. There is no reason why this form of co- operation should halt at national frontiers. On the contrary, there is every reason of principle and practical advantage why the Co-operative Movement should break through the material and mental barriers of conventional nationalism into a new era of international co-operation. This implies, logically and practically, co-operative organisations of the third degree, like the Scandinavian Wholesale Society, the International Co- operative Petroleum Association and the International Co- operative Alliance itself.

The idea of greater unity and cohesion within the Co- operative Movement under various names - coordination, consolidation, concentration, integration - is gaining ground among Co-operators, for the most part as they come to realise that their most redoubtable competitors today are large-scale capitalistic concerns, vertically and horizontally integrated. There are no grounds for thinking that this competition will diminish in severity. Rather must we expect that, served by modern technical devices, capitalist enterprise will tend to continue its evolution towards oligopoly and monopoly, not in national markets only, but on the international plane in new multi-national economic units called free-trade areas or economic communities. The competition which survives will be not the competition of the greater against the smaller, but the competition of the greater amongst themselves. The Co-operative Movement is potentially among the greatest. It needs only to concentrate its power in large units by applying consistently without restriction, from the local to the international plane, the principle of co-operation among co-operatives, to make its greatness manifest and to act successfully against the monopolies.

In order that it shall do so, Co-operators must from time to time re-examine their practices and their institutions in the light of their ultimate aims and the principles which subserve these aims. It will be necessary to discard glosses and one-sided interpretations based on expediency in order to make clear the common ground on which Co-operators can come together and work together for the ideal of a better and more fully human society than mankind int he mass has yet achieved. Such working together implies not merely the loyal collaboration, within their unions and federations, of co-operatives of any given type, but also closer and more helpful relations between co-operatives of different types on every level where this is practicable. The idea of a co-operative sector in the economy is too often an intellectual concept without a corresponding material reality, simply because of the lack of unity and cohesion between the different branches of the Movement.

The Commission is fully aware that, in thus advocating more intimate and comprehensive inter-co-operative relations, it is echoing the thoughts and language of those who first brought these questions into the foreground of discussion a generation ago. What disturbs the Commission is the lapse of time between the enunciation of sound co-operative ideas and their realisation in action and it cannot forbear to point out that the failure of many co-operative organisations to provide enough of the right type of education for their members and leaders contributes in a large measure to this deficiency. But it would also point out that accelerated rate of progress in contemporary economic evolution has reduced, and is reducing still further, the time allowed to the Co-operative Movement to demonstrate the value of its principles and methods. The world will judge the success of Co-operation by its contribution to raising the level of human well-being as quickly as possible. Humanity at large is seeking, however blindly, for a major transformation from a system dominated by capital to one based on human dignity and equality. The Co-operative Movement, when true to its principles and armed with the courage of its convictions, can prove by practical demonstration that a world society is possible in which man is no longer the slave but the master of economic forces. Its mission is to reach the common people by demonstrating how the principles which express their neighbourly and brotherly relations in their Co-operative can also inspire the mutual relations of the nations.

If the co-operative movement is to rise to its full stature, either within each country, or internationally, the several co- operative institutions must unreservedly support one another. They must act as members of a common united effort to realise the objectives and ideals of the movement as a whole. These are no less than the attainment of a stage at which conflict, monopoly and unearned profit cease to exist. The ideal of workers' community such as the one envisaged by Rochdale Pioneers, or a co-operative commonwealth desired by several other co-operators, can hardly be realised in practice except by the unstinted and united efforts of all co-operators and co-operative institutions, large and small, national and international.

Co-operators the world over should profoundly appreciate that the most important aim of the co-operative movement is the promotion of the social and economic rights of the people and that the pursuit and achievement of this high aim requires active and concerted efforts towards the realisation of world peace.

RESOLUTION

The 23rd Congress of the ICA welcomes the report of the Commission on Co-operative Principles as meeting the specification required by resolution at the 22nd Congress.

Congress accepts that, while there can be differences of opinion as to emphasis or degree, the report is a significant statement of co-operative principles in a modern setting.

Congress approves the Recommendations and Conclusions made by the Principles Commission as follows:

1. Membership of a co-operative society should be voluntary and available without artificial restriction or any social, political or religious discrimination, to all persons who can make use of its services and are willing to accept the responsibilities of membership.
   
   
2. Co-operative societies are democratic organisations. Their affairs should be administered by persons elected or appointed in a manner agreed by the members and accountable to them. Members of primary societies should enjoy equal rights of voting (one member, one vote) and participation in decisions affecting their societies. In other than primary societies the administration should be conducted on a democratic basis in a suitable form.
   
   
3. Share capital should only receive a strictly limited rate of interest, if any.
   
   
4. Surplus or savings, if any, arising out of the operations of a society belong to the members of that society and should be distributed in such manner as would avoid one member gaining at the expense of others.
   
   
5. This may be done by decision of the members as follows:
   
   a) By provision for development of the business of the co-operative;
   
   b) By provision of common services; or,
   
   c) By distribution among the members in proportion to their transactions with the society.
   
   
6. All co-operative societies should make provision for the education of their members, officers, and employees and of the general public, in the principles and techniques of Co- operation, both economic and democratic.
   
   To these we have though it important to add a principle of growth by mutual co-operation among co-operatives:
   
   
7. All co-operative organisations, in order to best serve the interests of their members and their communities, should actively co-operate in every practical way with other co- operatives at local, national and international levels.

Congress authorises the Central Committee and its Executive to take note of the decisions of the congress on the report of the ICA Commission on Co-operative Principles at the 23rd Congress in Vienna and arising there from to make such recommendations for changes in the rules of the ICA as may be considered necessary for the next Congress.

Amendment by KK and YOL, Finland

Delete entire Central Committee proposal and substitute:

The 23rd Congress of the ICA,
Considers that the Report of the Commission on Co-operative Principles gives a good survey of the practices in different countries and different economic systems, and offers a very good basis for discussions;

Requests the Central Committee to empower the Executive to inquire into the opinion of the national member organisations of the ICA on the Report and Proposals of the Commission;

Asks the Central Committee to consider the proposals of the national co-operative organisations and those of the Commission at a meeting preceding the 24th Congress and to submit its opinion to the Congress;

Requests the Central Committee to include in the Agenda of the 24th Congress of the ICA consideration of principles for the activity of the Co-operative Movement.