Proposed text:

The first discussion of the promotion of cooperatives took place at the 89th Session (2001) of the International Labour Conference. On the basis of that discussion, and in accordance with article 39 of the Standing Orders of the Conference, the International Labour Office prepared and communicated to the governments of member States the text of a proposed Recommendation concerning the promotion of cooperatives. This text was incorporated in Report IV (1).⁽¹⁾

Governments were invited to send, after consulting the most representative organizations of employers and workers, and national cooperative organizations if they so wished, any amendments or comments on the text so as to reach the Office by 30 November 2001 at the latest, or to inform it, by the same date, whether they considered that the proposed text constituted a satisfactory basis for discussion by the Conference at its 90th Session (2002).

At the time of drawing up this report, the Office had received replies from the governments of the following 56 member States: Argentina, Australia, Austria, Barbados, Belarus, Belgium, Benin, Brazil, Bulgaria, Burkina Faso, Cameroon, Canada, Chile, China, Colombia, Costa Rica, Croatia, Cyprus, Ecuador, Egypt, El Salvador, Eritrea, Estonia, Ethiopia, Finland, France, India, Israel, Italy, Japan, Kuwait, Lebanon, Lithuania, Mauritius, Mexico, Morocco, Myanmar, New Zealand, Nigeria, Norway, Panama, Philippines, Poland, Portugal, Romania, Singapore, Slovakia, South Africa, Spain, Sweden, Switzerland, Syrian Arab Republic, Thailand, United Arab Emirates, United Kingdom, United States.

In the case of 44 countries (Argentina, Austria, Belarus, Belgium, Benin, Brazil, Bulgaria, Cameroon, Canada, China, Colombia, Costa Rica, Croatia, Cyprus, Ecuador, Egypt, El Salvador, Estonia, Ethiopia, Finland, France, Japan, Lithuania, Mauritius, Mexico, Morocco, Myanmar, New Zealand, Nigeria, Norway, Panama, Philippines, Poland, Portugal, Romania, Slovakia, South Africa, Spain, Sweden, Switzerland, Syrian Arab Republic, United Arab Emirates, United Kingdom, United States) the replies of employers’ and/or workers’ organizations were incorporated into those of the government, appended to the government’s reply, or communicated directly to the Office.

To ensure that the English and French texts of the proposed Recommendation concerning the promotion of cooperatives are in the hands of the governments within the time limit laid down in article 39, paragraph 7, of the Standing Orders of the Conference, Report IV (2) is published in two volumes.⁽²⁾ The present bilingual volume, Report IV (2B), contains the English and French versions of the proposed text as amended in the light of the observations made by governments, by employers’ and workers’ organ­izations, and a few cooperative organizations, and for the reasons set out in the Office commentaries. In addition, some slight changes were made, where appropriate, in the wording of the texts, mainly to ensure full convergence between the two versions of the proposed Recommendation.

If the Conference so decides, this text will serve as a basis for the second discussion, at the 90th Session of the Conference (2002), of the question concerning the promotion of cooperatives.

The following is the English version of the proposed Recommendation concerning the promotion of cooperatives, which is submitted as a basis for discussion of the fourth item of the agenda of the 90th Session of the Conference.

The General Conference of the International Labour Organization,

Having been convened at Geneva by the Governing Body of the International Labour Office, and having met in its 90th Session on 3 June 2002, and

Recognizing that globalization has created new and different pressures, problems and opportunities for cooperatives, and

Noting the ILO Declaration on Fundamental Principles and Rights at Work, adopted by the International Labour Conference at its 87th Session (1998), and

Noting the rights and principles embodied in international labour Conventions and Recommendations, in particular the Freedom of Association and Protection of the Right to Organise Convention, 1948; the Right to Organise and Collective Bargaining Convention, 1949; the Social Security (Minimum Standards) Convention, 1952; the Discrimination (Employment and Occupation) Convention, 1958; the Employment Policy Convention, 1964; the Rural Workers’ Organisations Convention and Recommendation, 1975; the Human Resources Development Convention and Recommendation, 1975; the Employment Policy (Supplementary Provisions) Recommendation, 1984; and the Job Creation in Small and Medium-Sized Enterprises Recommendation, 1998, and

Recalling the principle embodied in the Declaration of Philadelphia that “labour is not a commodity”, and

Recalling that the realization of decent work for workers everywhere is a primary objective of the International Labour Organization, and

Having decided upon the adoption of certain proposals with regard to the promotion of cooperatives, which is the fourth item on the agenda of the session, and

Having determined that these proposals shall take the form of a Recommendation;

adopts this          day of June of the year two thousand and two the following Recommendation, which may be cited as the Promotion of Cooperatives Recommendation, 2002.

1. This Recommendation applies to all types and forms of cooperatives.

2. For the purposes of this Recommendation, the term “cooperative” means an autonomous association of persons who voluntarily join together to meet their economic, social and cultural needs and aspirations through the formation of a jointly owned enterprise, contributing equitably to the capital required, accepting a fair share of the risks and benefits, and participating actively in its management and democratic control.

3. The promotion and strengthening of the identity of cooperatives should be encouraged on the basis of:

1. cooperative values of self-help, self-responsibility, democracy, equality, equity, and solidarity; and
2. internationally recognized cooperative principles of voluntary and open membership, democratic member control, member economic participation, autonomy and independence, education, training and information, cooperation among cooperatives, and concern for community.

4. Measures should be adopted to promote the potential of cooperatives in all countries, irrespective of their level of development, in order to assist their membership to:

1. create and develop income-generating activities and sustainable decent employment;
2. develop human resource capacities and knowledge of the values of the cooperative movement through education and training;
3. gain access to markets and to institutional finance;
4. increase savings and investment; and
5. improve social and economic well-being, taking into account the need to eliminate all forms of discrimination.

5. The adoption of special measures to enable cooperatives, as enterprises and organizations inspired by solidarity, to respond to their members’ needs, and the needs of society, including those of disadvantaged groups in order to achieve their social inclusion, should be encouraged.

6. Governments should define and apply a supportive policy and legal framework that is consistent with the nature and function of cooperatives and that is guided by the cooperative values and principles set out in Paragraph 3, which would:

1. establish an institutional framework with the purpose of allowing for the registration of cooperatives in as rapid, simple, and efficient a manner as possible;
2. provide for the adoption of measures for the oversight of cooperatives, on terms appropriate to their nature and functions, which respect their autonomy and which are no less favourable than those applicable to other forms of enterprise and social organization;
3. facilitate the promotion of cooperative structures according to the needs of co­operative members; and
4. encourage cooperative development, including in areas where cooperatives have an important role to play or provide services that are not otherwise provided.

7. (1) The promotion of cooperatives guided by the values and principles set out in Paragraph 3 should be considered as one of the objectives of national and inter­national economic and social development.

(2) Cooperatives should be treated on terms no less favourable than those accorded to other forms of enterprise and social organization.

(3) Support measures should be introduced, where appropriate, for the activities of cooperatives that meet specific social and public policy outcomes, such as employment promotion or the development of activities benefiting disadvantaged groups or regions. Such measures could include among others, in so far as possible, tax benefits, loans, grants, access to public works programmes, and special procurement provisions.

(4) Special consideration should be given to increasing women’s participation in the cooperative movement at all levels, particularly at management and leadership levels.

8. (1) National policies should notably:

1. promote core labour standards and the ILO Declaration on Fundamental Principles and Rights at Work for all workers in cooperatives without distinction whatsoever;
2. ensure that cooperatives are not set up for, or directed at, non-compliance with labour laws or used to establish disguised employment relationships;
3. promote gender equality in cooperatives and in their work;
4. develop the technical and vocational skills, entrepreneurial and managerial abilities, knowledge of business potential, and general economic and social policy skills, of members, workers and managers, and improve their access to information and communication technologies;
5. promote education and training in cooperative principles and practices, at all appropriate levels of the national education and training systems, and in the wider society;
6. promote the adoption of measures that provide for safety and health in the workplace;
7. provide for training and other forms of assistance to improve the level of productivity of cooperatives and the quality of goods and services they produce;
8. facilitate access of cooperatives to credit;
9. facilitate access of cooperatives to markets;
10. promote the dissemination of information on cooperatives; and
11. seek to improve national statistics on cooperatives with a view to the formulation and implementation of development policies.

(2) Such policies should:

1. decentralize to the regional and local levels, where appropriate, the formulation and implementation of policies and regulations regarding cooperatives;
2. limit the legal obligations of cooperatives to the same extent as required by national law of any other form of enterprise in areas such as registration, financial and social audits, and the obtention of licences; and
3. promote best practice on corporate governance in cooperatives.

9. Governments should promote the important role of cooperatives in transforming what are often marginal survival activities (sometimes referred to as the “informal sector”) into legally protected work, fully integrated into mainstream economic life.

10. (1) Specific legislation and regulations on cooperatives, which are guided by the cooperative values and principles set out in Paragraph 3, should be adopted and should be revised when appropriate.

(2) Cooperative organizations, as well as the employers’ and workers’ organizations concerned, should be consulted in the formulation and revision of legislation and regulations applicable to cooperatives.

11. (1) Cooperatives should have access to support services in order to strengthen their business viability and their capacity to create employment and income.

(2) These services should include, wherever possible, the following:

1. human resource development programmes;
2. research and management consultancy services;
3. access to finance and investment;
4. accountancy and audit services;
5. management information services;
6. information and public relations services;
7. consultancy services on technology and innovation;
8. legal and taxation services; and
9. other support services appropriate to specific economic sectors.

(3) Governments should facilitate the establishment of these support services. Cooperatives and their organizations should be encouraged to participate in the organization and management of these services and, wherever feasible and appropriate, to finance them.

12. Measures should be adopted to facilitate the access of cooperatives to investment finance and credit. Specific measures should notably:

1. allow loans and other financial facilities to be offered;
2. simplify administrative procedures, remedy the low level of cooperative assets, and reduce the cost of loan transactions;
3. facilitate an autonomous system of finance for cooperatives, whereby financial resources and transactions are controlled by different types of cooperative organ­izations, including savings and credit, banking and insurance cooperatives; and

13. For the promotion of the cooperative movement, conditions should be encouraged favouring the development of technical, commercial and financial linkages among all forms of cooperatives so as to facilitate an exchange of experience and the sharing of risks and benefits.

14. Employers’ organizations should consider, where appropriate, the extension of membership to cooperatives wishing to join them and provide appropriate support services on the same terms and conditions as for their other members.

15. Workers’ organizations should be encouraged to:

1. advise and assist workers in cooperatives to join workers’ organizations;
2. assist their members to establish cooperatives with the aim of facilitating access to basic goods and services;
3. participate in committees and working groups at the national and local levels that consider economic and social issues having an impact on cooperatives;
4. participate in the setting up of new cooperatives with a view to the creation or maintenance of employment, including in cases of proposed closures of enterprises;
5. participate in programmes for cooperatives aimed at improving their productivity;
6. promote equality of opportunity in cooperatives; and
7. undertake any other activities for the promotion of cooperatives, including education and training.

16. Cooperative organizations, in particular their unions and federations, should be encouraged to:

1. establish an active relationship with employers’ and workers’ organizations and concerned governmental and non-governmental agencies with a view to creating a favourable climate for the development of cooperatives;
2. manage their own technical support services and contribute to their financing;
3. provide commercial and financial services to affiliated cooperatives;
4. invest in human resource development in cooperatives;
5. represent the national cooperative movement at the international level; and
6. undertake any other activities for the promotion of cooperatives.

17. International cooperation should be facilitated through:

1. exchanging information on policies and programmes that have proved to be effective in employment creation and income generation for members of cooperatives;
2. encouraging and promoting relationships between national and international bodies and institutions involved in the development of cooperatives in order to permit:
1. the exchange of personnel and ideas, of educational and training materials, methodologies and reference materials;
2. the compilation and utilization of research material and other data on co­operatives and their development;
3. the establishment of alliances and international partnerships between co­operatives; and
4. the promotion and protection of cooperative values and principles;

3. access of cooperatives to national and international data, such as market information, legislation, training methods and techniques, technology and product stand­ards; and
4. developing, wherever possible and in consultation with cooperatives, employers’ and workers’ organizations concerned, common regional guidelines and legis­lation on cooperatives.

¹ ILO: Promotion of cooperatives, Report IV (1), International Labour Conference, 90th Session, 2002.

² Report IV (2A) will be in the hands of governments approximately one month after the present volume and will contain summaries of the replies received and the Office commentaries.

Updated by HK on 24 September 2002.