Saturday 7 July 2018 is the International Day of Co-operatives, an opportunity to celebrate the economic, social and community benefits co-operatives bring to our society. Although sometimes overshadowed by the company model, the co-operative model structure is an attractive business structure.
Co-operatives are owned and run by their members for the benefit of those members. All co-operatives adhere to seven international principles, which include democratic member control and a focus on sustainable development of the community.
Co-operatives are also big business. One in every six people worldwide is a member of a co-operative. Eight in 10 Australians are members of a co-operative or mutual, although only 3 in 10 can name one! Co-operatives and mutual businesses hold about 29 million memberships across the Australian economy. The Business Council of Co-operatives and Mutuals (BCCM) represents a sector of the Australian economy that turns over $27.8 billion annually and which holds 14.8 million memberships across an estimated 2000 co-operatives and mutuals.
As a business structure, co-operatives deliver many of the benefits of a company and they act as a separate legal entity which protects members from liability. However, because they are run by members, the people directly engaged in the business of the co-operative make the decisions. This gives members of a co-operative a much greater level of control, without the intervention of an external board. Co-operatives focus on delivering benefits to their members and the community rather than strictly delivering profit for shareholders. This means co-operatives can deliver members better returns or to reinvest the proceeds in improving their products or services and lowering costs. The co-operative is a recognised Australian legal structure to consider when choosing a model for your business.
Co-operatives have a long history in banking, superannuation, retailing and agriculture and are increasingly adopted in the social care sector to provide sustainable aged and disability care and housing services.
The Co-operative Life is a social care co-operative owned by aged and disability care workers. It allows its members more control over their shifts and working conditions and to develop a more direct relationship with their clients. Their clients benefit from increased continuity and longer-term relationships with carers. Supporting Independent Living Co-operative (SILC) is an incubator co-operative which helps young people with disabilities and their families develop their own independent housing co-operatives under the National Disability Insurance Scheme (NDIS). By providing the ability to make their own housing and care choices, such co-operatives allow more independence, stability and control for Australians with disabilities. Canberra’s own National Health Co-op gives its members access to bulk-billed doctors and other low or no cost medical services.
These are just some of the many ways that co-operatives are being used to build a sustainable society with economic and social outcomes for members and the greater community. Co-operatives have proven social benefits, but they are first and foremost an effective business operating structure.
If you are interested in learning more about the benefits of a co-operative structure for your business, please contact Katie Innes at BAL Lawyers. For more information on co-operatives or the International Day of Co-operatives contact the BCCM at http://bccm.coop/.
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