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A cooperative is generally a voluntary union of people. A cooperative is founded on the basis of economic, social or cultural factors, which all its members share an interest in. The most significant feature of cooperatives is that members are owners, contributors and also decision-makers.
Member participation in cooperatives
The union of individuals into a cooperative is undertaken for the mutual benefit of all members. There are three principles which define the main characteristics in cooperatives:
Principle of self-help: The voluntary union of individuals into a cooperative should improve the economic, social or cultural conditions of members.
Principle of personal responsibility: Since members own the cooperative, they are responsible for the actions in the cooperative.
Principle of self-administration: Members take care of the economic matters by administering and controlling the boards in the cooperative.
Governance in cooperatives
Member participation is based on a fundamentally democratic principle: no matter how many shares an individual member holds in the cooperative, each member still has one vote.
Depending on the size of the cooperative, members can either elect delegates (or regional / local representatives) or the board of directors directly. The board runs the cooperative on behalf of all members.