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Posted on Oct 1, 2013

Social Enterprise that Empowers: the Co-operative Model

Social Enterprise that Empowers: the Co-operative Model

By Hazel Corcoran and Greg O'Neill[1]

Hazel Corcoran, Executive Director, Canadian Worker Co-op Federation, will be attending SEWF 2013. 

Greg O'Neill is the Co-operative Developer at Big Idea Consulting.

The Contributors:

Kaye Grant, Consultant, Reconnaissance Management Consulting Group Inc. and Lynne Markell, Manager of Co-op Development, Canadian Co-operative Association,will also be attending SEWF 2013. 

Marty Donkervoort, Founder, Inner City Renovation, will be speaking at the SEWF 2013 session "Marketing Your Social Enterprise – the Fundamentals and the New Essentials."

Brendan Reimer, Regional Coordinator, Canadian CED Network, will be speaking at the SEWF 2013 session "Making Time for Research: Why Research Helps and How You Can Help Research."

Ethel Côté, Social Enterprise Practitioner and Developer, Canadian Centre for Community Renewal, will be speaking at the SEWF 2013 session "Introduction à l’entreprise sociale (français)."

Michelle Colussi, Manager, Technical Assistance Division, Canadian Centre for Community Renewal, will be speaking at the SEWF 2013 session "International Dialogue on Ecosystem Approaches to Supporting Social Enterprises."

NOTE: those who wish to learn more about co-operatives especially worker co-operatives are encouraged to watch all or part of the documentary Shift Changebeing shown at SEWF on four different occasions in the Eat, Think, Be Visionary Hall.

The feature picture is courtesy of Compfight / A Flickr Search Tool.    

I.  The Problem: the System is Broken

The current global economic system has grown into something which does not serve people; it serves capital.  In the last thirty years, the neoliberal model of economics has been unleashed with a fury.

Inequality is growing by leaps and bounds around the world, in some places to levels not seen since the Great Depression. The 1% get increasingly rich, while many working people face growing challenges and threats, including lack of access to a living wage, lack of access to adequate health care, lack of community, illiteracy and inadequate education, ignorance, apathy, social insecurity, physical deprivation, mounting student debt, racism, sexism, small farmers not getting a fair price for their products, homelessness, and elitist bias in the media.

neechi 1More and more people around the world are becoming critical of this global corporatist model, from peace activists, to environmentalists, and most directly those who have raised their voices against corporate globalization, from Occupy Wall Street, to Idle No More. The chants of these courageous groups --, "Another World is Possible", “We Are the 99%”, and indeed “Idle No More!” -- ring out across the globe, early sounds of a search for something beyond resistance, for fresh alternatives. Even some conventional economic thinkers are pointing to what is wrong.  For example, business reporter Eric Reguly stated recently that, “Paul Polman, the CEO of Unilever, thinks American-style capitalism is broken…”[2]

Our economy is run to serve the needs of capital and not of people. So we should not be surprised with the result:  the needs of capital are met, the needs of people are a distant second.   The financial crisis in 2008 has made these inequalities worse, and these tensions all the more real as banks received billions in taxpayers’ funds while foreclosures resulted in hundreds of thousands of people losing their homes.


There is a need to identify new economic models, which address the economic challenges we face, as well as our social and environmental challenges.  

II. The Co-operative Solution[3]

People are searching for a better way. We are looking for a fair, equitable and human way to organize ourselves to use and distribute the limited resources of this planet for the benefit of us all as opposed to the few.  There is a way to do this.  We can make the next big leap and create a system of economic democracy.

There is an economic system that is based on democracy, equality and mutual self-help.  However, it is virtually unknown among those activists and agents for social change that are described above.

The capitalist economic system does not typically teach this economic system in the high schools, business schools or universities.

The Statement of the Co-operative Identity was written as the result of a consultation process, starting in the 1840s and then revised every few decades, as coordinated by the International Co-operative Alliance (“ICA”). 

Statement of the Co-operative Identity[4]



A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.


Co-operatives are based on the values of self-help, democracy, equality, equity, and solidarity.  Co-operative members believe in the ethical values of honesty, openness, social responsibility, and caring for others.


1st Principle:  Voluntary and Open Membership

2nd Principle: Democratic Member Control

3rd Principle: Member Economic Participation

4th Principle: Autonomy and Independence

5th Principle: Education, Training and Information

6th Principle: Co-operation Among Co-operatives

7th Principle: Concern for Community

Imagine what a different world it would be if all businesses were formed using these principles and values!

This form of human enterprise has taken hold of peoples’ imaginations and regional co-operative movements have sprung up and transformed regional economies. 

For example the Antigonish Movement in the Maritimes in the 1930’s through the 1960’s, led by Fathers Moses Coady and Jimmy Tompkins. There is the ongoing creation of the Co-operative economy of the Mondragon region of Basques Spain. Today the Emilia Romagna region of Italy, where worker co-ops and social co-ops are significant part of the economy, stands as a current example.  In Argentina, with their economy in shambles, bankrupt firms are being seized by their workers and turned into worker-owned co-operatives.  Thus there are examples of times and places where the Co-operative way of life infused the public conscience and transformed peoples’ lives.  

Our challenge is to bring this same energy, imagination, creativity and drive to a movement that exists on a global scale.  

We need to move from the theory of a Co-operative movement to the reality of a Co-operative movement.

In 1911, George Keen General Secretary of the Co-operative Union of Canada, wrote in The Canadian Co-operator:

“No thoughtful person, who brings a dispassionate mind to bear upon the subject, can doubt that, in due course, the machinery of production, distribution and exchange of wealth will be administered on a just and equitable basis for the use, comfort and convenience of the people as a whole instead of, as now, for the private aggrandizement… of the few.  The period and the form will depend upon the extent to which, and the rapidity with which, the mass of the people are capable of moral and intellectual improvement, and the reception of the associative spirit.  This is, we believe, the orthodox co-operative view.”  

The formal co-operative movement as we know it today started in the 1840’s at the height of the industrial revolution in northern England.  Co-operatives have been at this for a long time, and some have had great success.  Overall there are approximately one billion people who are members of co-operatives.  

“On this basis, the global representative body for co-operatives is one of the largest non-governmental organisations in the world today by the number of people it represents, according to available figures.”[5]

The Canadian Co-operative Association provides the following facts and figures about the co-op movement.

  • “  There are approximately 9,000 co-operatives and credit unions in Canada, providing products and services to 18 million members.
  • Co-operatives exist in virtually every sector of the economy, from agriculture, retail and financial services to housing, child care, funeral services and renewable energy.
  • Co-operatives have more than $370 billion in assets, owned by their members and the communities they serve.
  • Co-operatives employ 150,000 people and are led by 100,000 volunteer directors and committee members
  • Canada has the highest per-capita credit union membership in the world: 33 per cent of Canadians are a member of at least one credit union.
  • There are at least 2,000 communities with at least one credit union or caisse populaire and more than 1,100 communities in which a financial co-operative is the only financial services provider.
  • The survival rate of co-ops is higher than that of traditional businesses. A 2008 study in Quebec found that 62 per cent of new co-ops are still operating after five years, compared with 35 per cent for other new businesses. After 10 years, the figures are 44 per cent and 20 per cent respectively.
  • Co-operatives, credit unions and caisses populaires give millions of dollars back to their communities in the form of sponsorships and donations.”[6]

The consumer co-ops, credit unions and many of the large agricultural co-ops have successfully addressed their members’ issues of inequality & lack of access to markets, credit, etc. They have built success, found a way to meet their members’ needs and as such, they are no longer as focused on social change as they were in the time of their founders.  

However, these co-operatives are in fact meeting the very member needs they set out to meet, are strong contributors to their communities, and are returning millions of dollars in patronage to their members instead of to absentee shareholders.

They are contributing to co-operative associations and to education programs on co-operatives.[7]  Further, if members are unhappy with the direction of the co-op, they can get involved in the co-op’s democratic process and even run for the Board of Directors. 

 The established co-ops, although no longer generally on the vanguard of social change (with some notable exceptions such as Vancity), are quiet achievers which are doing what they set out to do. 

III. Co-operatives as Social Enterprise which Empowers

Jacques Defourny and Marthe Nyssens have stated that “what is striking is the diversity of terms which have been used since the early 1980’s to describe entrepreneurial behaviours with social aims which mainly developed within the non-profit sector,”[8] Similarly, there is a diversity of definitions of social enterprise, some of which include co-operatives, some of which appear to exclude co-operatives, and some of which include some but not all co-ops. 

See the Addendum to this paper with some of these definitions.

“Co-operatives often serve as a benchmark to other democratic ‘social economy enterprises’ since co-operatives possess a well-defined set of ethical values and principles that serve as guidelines for their democratic governance, operations, and member/user control over capital.”[9]

If the objective is both to have people in need carry out commercial activity that can provide them with the means to achieve social / economic change for themselves, and also to empower these intended beneficiaries, then the co-operative is, in our opinion, the best model that can do it.  The co-operative model is about helping people in need to help each other to meet their socio-economic needs.  Appropriate supports (appropriate technical assistance and capital) are needed for this be possible.  

We believe that co-operatives are enterprises which are set up by people in order to meet their own social and economic needs; by definition, in the Statement of the Co-operative Identity, they are “social enterprise.”  

[One type of entity which we would like to flag that is clearly not “social enterprise,” however, is privately owned enterprise operating in a social sphere.  Private business, doing good, is not social enterprise by any widely accepted definition.]

Whereas it is less obvious with some of the very established co-operatives that they are a mechanism for social change, yet it is the case - by their very democratic nature, and by the fact that they share their profits on the basis of patronage and not of share ownership.

Further, it is obvious in the newer and emerging co-operative sectors that they are, in fact, social enterprise: be it worker co-operatives, elder care co-ops, health care co-ops, renewable energy co-ops, funeral co-ops, or other emerging models.   The co-op model is endlessly adaptable. 

The fact that the co-op is owned and controlled on a one member-one vote basis is one of its most significant features.  This makes the beneficiaries simultaneously the creators of their own destiny. 

With regard to worker co-ops in particular, San Francisco’s Tim Huet states this in his Manifesto “There Is No More Important Social Change Work You Can Do Than Cooperative Development”: 

“For me, worker cooperatives are not simply businesses; they are democracy demonstration projects, schools for democracy, laboratories for democracy, and organizing bases for democracy. …  Democracy demonstration projects: As stated above, it is critical to build working examples of economic democracy that people can see and experience. From that point of view, every worker cooperative is a democracy demonstration project beyond simply being a business. In addition to producing bread, bicycles, etc., we produce hope and inspiration.

As importantly, we can provide an example and experience of community, which people hunger for in our disconnected society.  I see the proof and power of this on a regular basis through the cooperative bakeries with which I am mostly directly associated. Customers come in not simply for the great bread, but also for the sustenance of community. They sense the community at our cooperatives and want to be part of that. 

It follows from this that every interaction with the general public is imbued with social change importance and opportunity.”[10] 

Here is how the movement was described by Roberto Rodriguez, then President of the ICA, in 1999.  (Rodriguez later went on to serve as a cabinet minister in the Brazilian government under President Lula.)  

“This is the scenario, where the general rule is the growth of human unhappiness, hopelessness and lack of vision.

           Listen, hope is the fuel of life. Without it, why would we go on? This lack of perspective leads to dissatisfaction and revolt, especially amongst those who have nothing to lose.

           In this dramatic scene that I have etched for you, co-operativism - this phenomenon of the union of all human beings of all beliefs and colors - is fulfilling a wonderful role. In Africa, Eastern Europe, Asia, Latin America, and the rich countries of the EU and North America, the co-operatives are rejuvenating the basic values of equity, and re-building the social fabric worn away by the abyss between the classes.

           As quiet achievers, co-operatives have been generating jobs all over the world, fighting against social exclusion. They have also gathered together people that individually would be vulnerable, and transformed them in powerful unions, able to halt the concentration of wealth.”

IV. Where to Next?

Many of us in the co-operative movement believe that the social enterprise movement and the co-op movement, at least in most of North America, have been acting independently of each other.  

This is not the case in many other regions of the world, where co-operatives are often seen as at the centre of the social enterprise movement or of the social economy (notably in the Latin speaking countries and regions).

Due to common values and objectives, it is only logical that the social enterprise and co-operative movements work more closely together in Canada. 

“Notwithstanding some notable (technical and conceptual) differences, we share more than we don't share I think. For example, while SE's may not have a stated purpose of support for other SE's - it is an underlying value I see reflected none the less.  We all want to learn from and replicate good practices.   It's high time we found a way to collaborate around some kind of collective agenda."[11] 

Nancy Neamtan, CEO of the Chantier de l’économie sociale in Québec, has stated, “For us, it is clear that coops are one of the best models of 'social’ Enterprise.  And an integral part of the social and solidarity economy here and across the world.” 

We challenge the social enterprise movement and the co-operative movement to get to know each other, to learn from each other and to work more closely together.


[1] Hazel Corcoran is the Executive Director of the Canadian Worker Co-operative Federation and of CoopZone. Greg O’Neill is a co-operative developer with Big Idea Consulting.  Contributors to this paper have included: Kaye Grant, Lynne Markell, Marty Donkervoort, Brendan Reimer, Sonja Novkovic, Ethel Côté, Michelle Colussi, Claudia Sanchez-Bajo and Yvon Poirier.  Many thanks to all the contributors.  Any errors are ours – Hazel and Greg.

[2] Time to Put an End to the Cult of Shareholder Value, Eric Reguly, Report on Business, Sept. 27th, 2013.

[3] NOTE:  If the authors of this paper have not spent much time discussing social enterprises other than co-operatives, it is because we are not expert on them.

[4] (These principles are explained in more depth on the ICA web site.) 



[7] For example, the St. Mary’s University Masters in Co-op Management, and the CoopZone Co-op Developer Training Program, both of which are distance programs. 

[8]Conceptions of Social Enterprise in Europe and the United States: Convergences and Divergences;,%20M.%20Nyssens.pdf, p. 5.

[9] “Cooperatives as agents of collective entrepreneurship: Reflections on the rise of the social enterprise phenomenon”, by Milford Bateman, Visiting Professor of Economics, Pula University, Croatia, and Sonja Novkovic, Professor of Economics and Cooperatives, St Mary’s University, Halifax.  Paper presented at the 43rd Atlantic Schools of Business Conference (ASB), Antigonish, Nova Scotia, Canada, September 29, 2013.


[11] Michelle Colussi, Canadian Centre for Community Renewal, BC.


ADDENDUM, provided by Marty Donkervoort, Winnipeg, MB

Here are some definitions from three different sources, ENP in Canada, EMES in Europe and a London group in UK. All focus on mission and purpose rather than corporate structure.

The working definition of a social enterprise as developed by EMES research includes the following parameters:

A continuous activity producing goods and or selling services; a high degree of autonomy; a significant level of economic risk; a minimum amount of paid work; an explicit aim to benefit the community, an initiative launched by a group of citizens; a decision-making power not based on capital ownership; a participatory nature, which involves the persons affected by the activity; and limited profit distribution.


ENP Canada

Businesses that sell goods or provide services in the market for the purpose of creating a blended return on investment, both financial and social. Their profits are returned to the business or to a social purpose, rather than maximizing profits to shareholders.

Social Enterprise London Definition

A social enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximize profit for shareholders and owners.

Common elements of social enterprise definitions

  •  A continuous activity producing goods and or selling services Social objectives are the main reason for the business (benefit to the community)
  • Profits/surpluses are for the benefit of the enterprise or its sponsoring non profit organization, not for shareholders
  •  Pursue blended return on investment between financial and social and or environmental
  •  Decision making power not based on capital ownership  

There are four major reasons social enterprise is gaining in popularity in recent years: 

  • The understanding that there are some needs the market will never meet on its own;
  • The opportunity to advance mission-related goals;
  •  Diminished and changing nature of government funding;
  •  The promise of social enterprise as a vehicle for social innovation.

Legal Structure

Social Enterprises can be incorporated as non-share capital corporations (not-for-profit), share capital corporation (for profit) or Co-operative (either for or not for profit).

More about Hazel Corcoran

Hazel Corcoran

Hazel Corcoran

Hazel has been involved in all aspects of worker co-op development and support including capitalization, technical assistance, research and writing, and launching the CoopZone Developers’ Network. 

Trained as a lawyer and fluently bilingual (EN-FR), Hazel has served the co-operative movement in a variety of capacities, including as Director of le Conseil canadien de la coopération (1994-2005), Calgary Co-op (1999-2002), Prairie Sky Co-housing Co-op (2006-2012), and First Calgary Financial Credit Union (2007-2012), and Executive Director of the CoopZone Developers’ Network. She helped found the Western Canada Labour-Worker Co-operative Council, a network of labour and worker co-op activists. She is also a co-founder of the Big Idea Rainbow Foundation, whose goal is to spread the message of co-operatives through popular culture. In June 2013, she was chosen to be a founding Board member of Co-operatives and Mutuals Canada. Hazel was born and raised in New Orleans but for most of her life has lived in Canada. She resides in Calgary.

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1 Comment

  1. Thanks for putting the co-op movement squarely where it needs to be: in this discussion not at the periphery. Looking forward to more conversations.