Principles of Cooperation - ICA 1966

1966 ICA principles

          After 1937 great changes took place all over the world. After the 2^nd world war, social and political conditions of carious nations changed considerably. Cooperatives had to adapt themselves to this changing conditions.

          The 1937 principles were considered as unrealistic and out dated. So there was a necessity to reformulate the principles of cooperation. In October 1964, the ICA appointed a commission to study the principles under the chairmanship Dr.D.G.Karve. The commission submitted its report in 1966, with the following six principles.

1.              Open and voluntary membership

2.              Democratic control

3.              Limited interest on share capital

4.              Equitable Division of surplus

5.              Cooperative education

6.              Cooperative among cooperatives

Explanation of principles (1966)

1.       Open and voluntary membership

          This principle may be sub divided into two namely voluntary association and open membership

1.               Voluntary association : it means

                 i.                    A person who joins a cooperative society should do it on his own free will;

               ii.                    The society which admits a person into its membership should likewise do so voluntarily.

b.                Open membership:

                 i.                    There shall be no artificial restriction on the admission of members;

               ii.                    There shall be no social, political , racial or relious discrimination against the persons who wish to join;

              iii.                    Membership shall be available to all persons who need and can make use of societies’ services and are willing to accept the responsibilities of membership.

2.       Democratic control

1.    The general body meeting of the members of a cooperative society is the supreme authority in regard to the conduct of the affairs of the society

2.    The affairs of the society are administered by the management in accordance with democratically  expressed will of the members

3.    The management is elected or appointed in a manner agreed by the members

4.    The management is accountable to the members

5.    The members of primary society shall enjoy equal rights of voting and participation in decision affecting the society, by preactcing “ one members one vote policy”. In other than primary societies the administration shall be conducted on a democratic basis in a suitable manner.

3.       Limited interest on share capital

          This principle was advocated by Robert own and it was practiced by the Roachdale Pioneers.

          Cooperative organizations are business organizations. As business organization they need capital to carry on the business activities in an effective manner. They do not neglect capital. The volume of business is determined by the capital base, cooperative organization collect share capital, accept deposits, create reserve fund, and borrow funds from higher organization

          But the place assigned to capital is a secondary one. Capital is treated as servant and never allowed to become master. So it is remunerated by paying a fixed and limited interest. This payment is not out of any sense of fairness, but out of necessity. It helps to attract the non- cooperators as well as to mobilise more funds.

4.       Equitable Division of surplus

          In other words, it is called as “Distributive Justice”. In the words of ICA, the principle is meant as, the economic results, arising out of the operations of the society belong to the members of the society. It shall be distributed in such manner as would avoid one member gaining a the expense of others.

5.       Cooperative Education

          It is also called as “ Principle of Principles” it means imparting of knowledge about the principles , methods aims and practice of cooperation among the people and developing in term cooperative spirit and ability to work together.

          It is a sine-qua-con of cooperation. It makes possible the effective observance and application of all other principles. It is a means, by which the other principles of cooperation are implemented effectively.

          In the words of ICA, “All cooperative societies shall make provision for the education of their members, officers and the general public in the principles and techniques of cooperation both economic and democratic.

Methods of cooperative education

          The following methods are adopted by the cooperative to spread out the ideas of cooperation.

1)    Publishing of materials like booklets, leaf lets, journals, books etc.

2)    Conduct of educational programme for youth and women

3)    Conduct of seminar, workshops, meetings, conferences etc.

4)    Using audio-video equipment like Radio, T.V. for probagating films on cooperation to the public.

5)    Celebration of All India cooperative week Festivel

6)    Conduct of member education program

6.       Cooperation among cooperation

          This is also called as “Principle of Growth” This is a new principle incorporated by the ICA in the year 1966.

          ICA Pinpoints that, “ All cooperative organizations in order to serve the interest of their members and their communaities, shall actively cooperate in every practical way with other cooperatives at local, national and international level, having as their aim the achievements of unity of action by the cooperators throughout the world”

          It has been realised that the principle of cooperative unity is very much required not only among individuals but also among the cooperative institutions. Unless all the cooperatives of the world unite themselves to the cause of progress and efficiency, they will not be able to compete with well organized private and public sector. It is essential for cooperatives to cooperate with one another both for the preservation of their ideologies and their movement for increasing their business strength.