Producer Co-operatives and Workers

In his work over the last decade, Professor Daniel Côté has developed a new principle of management for non-worker co-operatives. The core of this work focuses on loyalty of the stakeholders. In his argument, Côté argues that all stakeholders of the co-operative must experience the co-operative benefit.

It is important, I found out over the weekend, to identify to whom the word “stakeholder” refers. Stakeholder has become a term used in business circles over the last couple of decades to identify interested parties that may not have a fedicuiary interest or responsibility but still value the enterprise (or benefit from it). In our cities, neighborhoods (and the people living in them) have a stakeholder role in the businesses that operate in their neighborhoods. Much to their dismay, many tavern owners in Madison have come to realize that the thousands of people living around them (who may never spend a penny in the tavern) have a stake in how the tavern operates.

In the more direct sense, workers form a primary stakeholder group of every co-operative. In the case of a consumer co-operative, the consumer member can easily find another store to shop. If the consumer co-op were to close or demutualize, their would be little effect on the consumer member other than a change in habit and a sense of loss For the worker of a consumer co-op, however, the closing of the store could mean long-term unemployment, loss of housing, healthcare and other hardships.

To some extent, the same can be said for a producer co-op. Farmers might, however, face a harsher marketplace. It is exactly this reason that Agricultural co-ops should embrace the Co-operative Paradigm. Côté makes this point in his description of the NCP: “A third assumption may therefore be made on the basis of this experimentation, relating to the social value attached to the co-operative organization: the NCP opens the way for the creation of social value based on (1) a business model that makes a significanf difference for stakeholders (2) while providing the footing for creating solidarity (3) and strengthening the community, (4) through the development of citizen values (5) leading to a different society, one that is more human and more egalitarian.” (Côté, 2005)

In other discussion about the NCP, Côté he comments that “Loyalty is based on the vision and reliability of senior management. Organizations that have it rely on long-term commitment and regard people (clients, employees and shareholders) as their best assets. . . it requires a focus on human dignity, and needs to find an equilibrium between personal and collective interest.” (Côté, 2000)

My personal experience with producer co-operatives is somewhat limited. When I have attended conferences and training sessions, I tend to meet very conservative (politically and socially) people from the generation of my parents (or pre-Viet Nam). I don’t want to suggest that they are negative people, but they see the co-op world as a form of collectivized capitalism and don’t necessarily see the big picture of humanity and social change. Workers tend to be hired hands (and they often prohibit members and the family of members from working for the co-op).

However, one of the new kids on the block is Organic Valley that has been shaking up the stereotypes. They certainly have a different view. I was pleasantly surprised to see that their web master is none other than mIEKAL aND. He spent a couple of decades in Madison as an artist and maintained a house in my neighborhood called the “Museum of Temporary Art”.

Organic Valley makes the natural leap that comes from organic farming. If happy cows produce better milk, then happy workers produce better service. The organic movement has to treat its workers as good as it treats the non-humans in the production chain. Of course, in the commercial farming world, the co-operatives still have an obligation to treat the workers well. The values and ethics of co-operatives apply to all stakeholders within the community, not just the membership.


Côté, Daniel (2005) “Loyalty and Co-operative Identity: Introducing a New Co-operative Paradigm” published (en Francais) in Revue Internationale de l’Economie Sociale RECMA, #295

Côté, Daniel (2004) “Co-operative Cohesiveness and the Democratic Process: The Key to Managing a Large C-operative” (French version: Revue du CIRIEC-Economies et solidarité, Vo. 34, No. 2

Côté, Daniel (2000) “Co-operative and the new millenium: The emergence of a new paradigm” in Fairbairn and Russel (eds) Canadian Co-operatives in the Year 2000: Memory, Mutual Aid and the Millenium. Saskatoon: Centre for the Study of Co-operatives.

About John McNamara

John spent 26 years with Union Cab of Madison Cooperative and currently helps develop co-ops in the Pacific Northwest. He holds a Ph.D. in Business Administration and Masters in Management: Co-operatives and Credit Unions from Saint Mary's University.
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