International Day of Cooperatives

Cooperatives' people-first approach proves effective for social and economic development

From agriculture to finance, cooperatives deliver a wide range of goods and services to members around the world. How can cooperatives best help realize the sustainable development goals being hammered out by the UN?

News | 14 July 2014
NEW YORK – With the welfare of members at the center of their business models, cooperative enterprises can play a critical role in achieving greater social inclusion and more sustainable development outcomes than traditional for-profit firms.

Cooperatives deliver a wide range of goods and services aligned with their members needs. More than half of the world’s cooperatives are estimated to focus on agriculture and food production, while financial cooperatives serve more than 857 million people worldwide, including 78 million people living on less than US$2 a day.

On the 2014 International Day of Cooperatives, the UN’s Department of Economic and Social Affairs (DESA) and the Committee for the Promotion and Advancement of Cooperatives (COPAC) organized a panel discussion 10 July at the UN in New York to mark the contributions of cooperatives toward sustainable development efforts.

In his statement, UN Secretary-General Ban Ki-moon noted that cooperatives “are helping communities in both developed and developing countries to generate energy, manage water supplies and provide other basic services.”

“As member-owned, member-run and member-serving businesses, cooperatives can put social justice and equity at the heart of economic progress while helping to ensure that the production and provision of goods and services matches the needs and aspirations of communities,” the Secretary-General said.

ILO Director-General Guy Ryder said that cooperatives and mutuals are “enterprises of the future” that serve to complement conventional markets and government action.

“Many of the poor and excluded are reached neither by conventional markets for goods and services nor by government,” Mr Ryder said. “Cooperatives and other social economy enterprises have shown that they have the necessary reach.”

ILO-NY Deputy Director, Vinicius Pinheiro, addresses the panel.
During the first panel, which focused on the theme of creating the necessary enabling environments in which cooperatives could grow and develop, H.E. Mr. Od Och, Permanent Representative of Mongolia offered his perspective.

“We all know that cooperatives are the most democratic and effective way of exercising control over the economic livelihoods of their members, based on mutual interest, which give them their particularity and efficiency,” Mr Och said, “and this time cooperatives are called once again to fulfill their noble mission to advance the model of sustainability.”

Mr Vinicius Pinheiro, Deputy Director of the ILO Office for the United Nations, spoke about the contributions cooperatives could make as a means to implement the UN’s post-2015 sustainable development agenda, particularly in generating decent job opportunities and extending social protection floors.

“Cooperatives can help in the extension of social protection floors, in particular through micro-insurance schemes,” said Mr. Pinheiro. “[And] we all know the role of cooperatives in the agricultural sector, not only in producing more food, but also in producing jobs.”

“We think cooperatives can play an enormous role in generating jobs. Today, there are already 50 million jobs that have been created in the cooperative structure,” he continued. “We need to use every single way that we have to generate jobs. Otherwise, the sustainable development agenda will not be sustainable at all.”

The second panel discussion addressed the role of cooperatives in realizing the sustainable development objectives of the UN, and was moderated by Mr Kevin Cassidy, Senior External Relations Officer of ILO Office for the United Nations.

Starting off the second panel, Rodrigo Gouveia, Director of Policy at the International Cooperative Alliance (ICA) noted that “cooperatives are people-centered, value-based organizations that have a long-term view. For a cooperative, a quarter is not three months, but 25 years. Younger generations are demanding companies provide better and more affordable services while exhibiting a social conscience and not just looking to maximize profits for shareholders.”

Mike Beal, CEO of the National Cooperative Business Association said “cooperatives are at the intersection of business, community and democracy. There are a number of major brands that are cooperatives and have used this fact in their advertising to successfully attract more customers. Smaller cooperatives, such as those in agriculture also play an important part in the supply chain of other international brands.”

Kevin Cassidy, Senior External Relations Officer at ILO-NY, moderates the discussion.
The Executive Director of the International Cooperative and Mutual Insurance Federation Americas, Ed Potter, said that cooperatives are “flexible and innovative.” “During the financial and economic crises, cooperatives grew at a faster rate than their for-profit competitors,” said Mr Potter.

In his closing remarks, Mr Cassidy noted that in the wake of the global crisis difficult economic times had caused many to consider support for cooperatives as a more attractive and sustainable industrial model.

“People are looking at how they are spending their money. They want to make sure that the companies they are actually investing in, through their purchases, are ethical companies that share their values,” Mr Cassidy said.  “The democratic and autonomous nature of cooperatives, focused on people not just shareholders, really highlights a quality that people are responding well to.”

Other experts from the UN’s Food and Agricultural Organization and the United Nations Federal Credit Union also presented during the event to discuss the social and economic benefits that cooperatives bring and their potential role in shaping the Post-2015 development agenda.

Cooperative enterprises are already active in all areas that have been proposed by the sustainable development goals and have a core operating ethos that speaks to all dimensions of poverty reduction and social exclusion. With such a history of financial and social successes, maybe cooperatives really will be enterprises for the future.