Cooperative Principles
The member-first principles that shape cooperatives
Cooperative businesses are found in many industries, and they all share the same foundation adopted by the International Co-operative Alliance: seven guiding principles. Examples of the cooperative business model include REI, Land O’Lakes, and Navy Federal Credit Union. At Middle Tennessee Electric, these principles have guided the cooperative since its creation in 1936 and continue to shape how it serves members today.
The seven Cooperative Principles
1. Voluntary and Open Membership
Cooperatives are voluntary organizations open to all people who can use their services and are willing to accept the responsibilities of membership, without gender, social, racial, political, or religious discrimination.
2. Democratic Member Control
Cooperatives are democratic organizations controlled by their members. Members take part in setting policies and making decisions, and elected representatives (directors) are accountable to the membership. In primary cooperatives, members have equal voting rights — one member, one vote.
3. Members’ Economic Participation
Members contribute fairly to the capital of their cooperative and help control it democratically. Part of that capital is usually the common property of the cooperative. Members may also direct surplus capital to support the cooperative business or electric system, build reserves, or support other approved efforts such as education and community improvement projects.
4. Autonomy and Independence
Cooperatives are autonomous, self-help organizations controlled by their members. If they work with other organizations or raise capital from outside sources, they do so in ways that protect democratic member control and maintain cooperative independence.
5. Education, Training, and Information
Cooperatives provide education and training for members, elected representatives, managers, and employees so they can contribute effectively to the cooperative. They also help inform the public — especially young people and community leaders — about the nature and benefits of cooperation.
6. Cooperation Among Cooperatives
Cooperatives serve their members best when they work together. They strengthen the cooperative movement through local, national, regional, and international partnerships.
7. Concern for Community
Cooperatives focus on member needs while also working for the sustainable development of their communities through policies accepted by their members.
Why these principles matter
These principles help explain what makes a cooperative different from other business models. They reflect a member-first approach built on shared responsibility, localized decision-making, and service to the community.