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1301.0 - Year Book Australia, 2012  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 24/05/2012   
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International Year of Co-operatives

CO-OPERATIVES IN AUSTRALIA – AN OVERVIEW


This article was contributed by Todd Green of Regional Development Australia Mid North Coast.


Co-operatives are people-centred organisations that are owned, controlled and used by their members. Each member has an equal say in what the co-operative does – so in addition to receiving the products and services they need, members help shape the decisions that their co-operative makes. The main purpose of a co-operative is to benefit its members.

Co-operatives are based on the values shown in diagram 1. These values are put into practice through the seven international co-operative principles shown in diagram 2.


1. CO-OPERATIVE VALUES

Co-operative values
Source: The International Co-Operative Alliance.


2. CO-OPERATIVE PRINCIPLES

Co-operative principles
Source: The International Co-Operative Alliance.


Diagram 3 shows how a co-operative in Australia is identified and regulated.<Endnote 1>. Co-operatives may be distributive or non-distributive co-operatives, broadly reflecting economic and social benefits respectively. Distributive co-operatives are formed to undertake commercial operations where members can share in profits made from trading and benefits from asset growth. The sharing of profits from a distributive co-operative can include dividends, rebates, reduced costs and/or enhanced services. A non-distributive co-operative can be formed with or without shares; commercial activities can be undertaken, although surplus funds are not distributed to members but used to support the activities of the co-operative. Both types of co-operatives require their members to maintain an active relationship with the co-operative. An active membership can include purchasing or supplying goods or services, paying an annual subscription, or being a tenant of a housing co-operative.

Co-operatives in Australia are involved in a wide range of activities, falling broadly into four categories: consumer (buying and selling goods to members at a competitive rate); marketing (branding, marketing and distributing members’ products and services); service (providing services to members, such as health, electricity or housing); and community (resource, information and skill sharing that encourages ownership and participation). Financial co-operatives comprise credit unions, mutual building societies and friendly societies.


3. IDENTIFICATION OF AUSTRALIAN CO-OPERATIVES(a)
3. Identification of Australian Co-operatives(a)

(a) Reflects the situation after the signing of the Co-operatives National Law and the National Regulations.

Source: Australian Bureau of Statistics based on information from various sources.


RECENT CHANGES

This material was contributed by Co-operatives Australia.

In recent years, the Australian ‘co-operatives sector’ has been characterised by:
  • large co-operatives growing organically and through mergers
  • losses due to mergers and demutualisation
  • emergence of new fledgling co-operatives and
  • low levels of understanding and teaching with regard to the co-operative business model.

As a consequence of an ageing and diminishing membership, a number of co-operatives have demutualised in recent years. Strong balance sheet growth sometimes fuels demutualisation, with members persuaded to give up ownership and control in return for a one-off cash or cash/investor share offer.

Some co-operatives have defied the trends, growing through innovative organic growth, mergers and joint ventures. New co-operatives have also emerged in recent years, demonstrating that member ownership and control remains a viable business model.

It is hoped that the United Nations 2012 International Year of Co-operatives will provide a focus on co-operatives and other member-owned businesses.

The incoming Co-operatives National Law will modernise the law governing Australian co-operatives and is expected to renew interest in the co-operative model.


ENDNOTES

1. The diagram and other information in this section reflect the situation after the signing of the Co-operatives National Law and the National Regulations. <Back>

 

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Statistics contained in the Year Book are the most recent available at the time of preparation. In many cases, the ABS website and the websites of other organisations provide access to more recent data. Each Year Book table or graph and the bibliography at the end of each chapter provides hyperlinks to the most up to date data release where available.


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