The year of the co-ops
Cooperatives around the world are celebrating International Year of the Cooperatives from October 2011 to October 2012 in line with a United Nations resolution. The Philippine cooperative sector opened up the celebration in Cebu City in October last year with programs organized by VICTO National in coordination with the Cooperative Development Authority. VICTO is a secondary co-op based in Cebu City and counts some 200 affiliates all over the country under its umbrella.
The three-day event was well attended by federation officers and members, congressmen, government officials and prominent personalities in the co-op sector. The theme of the celebration was the transformative force of co-ops in building up communities, nation and planet. At the end of the hectic week, VICTO hosted a no-frills party in the co-op headquarters in Beverly Hills, Cebu City.
I recall the co-op-related events while reviewing press materials pouring into my inbox from organizers of the 2012 International Summit of Cooperatives. The event takes place in Quebec, Canada this coming October.
The rejoicing in the co-op sector is worth watching because based on financial statements of the past three to five years, Philippine cooperatives posted huge growth in terms of income, and loads of benefits extended to ever-increasing numbers of members. Indeed, of all sectors around the globe, the co-op is the one to watch because of its widening base, resilience, proven track record and most of all, a Christian dimension in the core of every cooperative’s values and principles.
On the international front, the outlook is also upbeat.
The Desjardins Group, one of three hosts of the 2012 Coop Summit recently conducted a study to examine the cooperative movement in the province of Quebec and the rest of Canada. Although the study was limited only to Quebec, one of Canada’s 10 provinces, the results highlight the contribution of cooperatives to the social economy of Canada, a country which has more than 10,000 co-op enterprises and over 15 million members. According to the study, Canadian cooperatives generated close to 160,000 job opportunities.
Quebec has 3,300 active cooperatives and mutual aid organizations with eight million members. About 70 percent of Quebec’s population are co-op members, and 90,000 of them are directly employed by a co-op. From 2004 to 2008, non-financial co-ops created more jobs than the Quebec economy overall.
The International Labour Organization also conducted a study that focused on the strength of co-ops during recessions and there, too, co-ops fared better than traditional business models.
“If tough times are conducive to the formation of co-ops, they also allow them to demonstrate their soundness, as they did during the 2008 to 2009 downturn when they held up better than traditional businesses. Cooperatives and social economy enterprises are successful because they are attuned to the needs of the communities they serve, they work as a network and they use a different managerial model,” the UN agency reported.
The co-op model has long been held as radical because the owners of the business are the members themselves, so power is not concentrated to one person who has the money or a number of persons, like in a corporation.
As we know, United States financial institutions collapsed under the weight of failed transactions in the so-called prime toxic mortgages. The debacle infected many economies in Europe and even spelled bankruptcy for countries like Iceland. Despite state policies to cushion the impact of the 2008 to 2009 economic fiasco, the US has not recovered. The co-op style, as suggested not only by recent events but also by its undisputed growth and strength in overcoming recent major and global economic setbacks, is clearly superior to the traditional model.
The 2012 Cooperative Summit in Quebec, Canada intends to thresh out several issues that affect the co-op sector in general and in particular, present it as a real alternative to the prevailing business model.
One of the many things that can be said about co-ops is that they fill the gap in the limited capability of local government units to deliver social services. My observation is based on personal interaction with a number of co-ops in the Visayas and Mindanao.
In northern Negros for example, the work of the Escalante Public School Teachers and Employees Cooperative (EPSTEMPCO) can only be described as extraordinary.
Epstempco was set up in 1992 at a time when teachers were reeling from the exploitation of loan sharks and social inequity bred by the hacienda system. The failure of past co-ops and the bitter experiences during the martial law period would have been enough for the teachers to be swallowed by the insurgency movement but they took another shot at the co-op enterprise.
From a measly P6,400.00, the co-op today has combined assets of more than P100 million. Banking services assist close to 1,000 members, many of whom set up businesses that create jobs and help stabilize the social economy. Its micro-financing programs have also reached out to non-members like public market vendors, especially sacadas who moved out of haciendas to search for a better future in the city.
Epstempco has gone beyond the usual co-op lending and consumer services and here lies their versatility, if not acceptability. The national government’s public-private partnership finds realization in the co-op’s efforts to help the Escalante City government in implementing environmental programs for devastated coastal communities.
Escalante City used to be a major producer of crabs and mollusks, but years of environmental neglect and abuse rendered the coastal towns murky, polluted and unproductive. Two years ago, Epstempco took it upon itself to clean up and plant mangroves around the coastal areas of barangay Washington. Today the area is teeming with mangroves and perhaps, with proper follow-through would yield abundant seafood produce like in the past.
Epstempco’s good governance has become a model for primaries. Along with ICTUS Premier Multi-Purpose Cooperative, another enterprise based in Surallah, South Cotabato, they were nominated by VICTO as coops with best practices in the United Nations’ search for outstanding cooperatives. Mercedes “Ched” Castillo, CEO of VICTO National did tell me the federation has many affiliates with good practices and recognition would come in due time.
In the micro-level, the local co-ops demonstrate excellent performance, but in the bigger scheme of things, they also indicate the cooperative movement is both a force and idea whose time has come.
