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What is a Cooperative

What is a Co-op?

A cooperative is a business that was established by rural pioneers in the late 1930s and 1940s to provide electricity to rural Americans in places where investor-owned utilities wouldn't or couldn't serve because of cost. A cooperative is owned by the people who use it - members who have organized to provide themselves with the products and services they need. The members elect a board of directors who govern the cooperative and represent the needs of its members.



Cooperatives are guided by the set of seven principles:

  • 1st Principle: Voluntary and Open Membership
    Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of membership.

  • 2nd Principle: Democratic Member Control
    Cooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership.

  • 3rd Principle: Members' Economic Participation
    ​Members contribute equally to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. They usually receive limited compensation, if any, on capital subscribed as a condition of membership.

  • 4th Principle: Autonomy and Independence
    Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.

  • 5th Principle: Education, Training, and Information
    Cooperatives provide education and training for their members, elected representatives, managers and employees so they can contribute effectively to the development of their cooperatives.

  • 6th Principle: Cooperation Among Cooperatives
    Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.

  • 7th Principle: Concern For Community 
    While focusing on member needs, cooperatives work for community development through policies accepted by their members