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The Cooperativity Papers

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Image show many hands coming together, each holding a different piece of a puzzle.
Co-op leaders can work together to better articulate what cooperatives are, rather than what they aren’t.

In this 35th issue of the Principle 6 Newsletter, Mike Mercer reflects on the newsletter’s origins, impact and vision for the future. Where are efforts to embrace and act on the strategic power of cooperative identity headed?

“How can/should leaders forge thinking in a way that credit unions regard the cooperative business model as an indispensable asset?” Mercer writes.

While you’re thinking about “cooperation among cooperatives,” take a moment to consider how you and your cooperative practice this principle. NCBA CLUSA is on a mission to document Principle 6 collaborations across the country so we can identify trends, document best practices and share this knowledge with you—our fellow cooperators!

Share your example of Principle 6

 

Principle 6 Newsletter – The Cooperativity Papers

December 8, 2021

 

General Douglas MacArthur said, “Old soldiers never die, they just fade away.” Maybe. Mostly. But not Keith Richards. Not Pat Jury. Not me. Not yet! – Introduction, Principle 6 Newsletter, 7-15-20

Beyond this letter, I know not where opportunity leads. – Introduction, Principle 6 Newsletter, 7-15-20

You should write a book. – several readers, in reference to the Principle 6 Newsletter

You should read the [Principle 6 Newsletter]. It has become the Federalist Papers of the cooperative movement. – Maurice Smith, to participants on a Zoom conference, October 2021

The eighty-five essays appearing in New York City papers under the pseudonym Publius between October 1787 and May 1788 and later established under the title The Federalist Papers have achieved justifiable fame as an important statement of American constitutional philosophy. – Richard Beeman, “The Penguin Guide to the United States Constitution”

 

Yikes!

85 essays, NYC newspapers, ratification, constitution—Hamilton, Madison and Jay???

This is the 35th issue of the Principle 6 Newsletter. It only reaches a few thousand co-op folks. The closest thing to a constitution in need of ratification is the challenge to embrace Rochdale-inspired and ICA-articulated co-op identity, values and principles. And, so far, it’s just one rapidly obsolescing credit union cat, musing a couple of times a month for the good of the order. Alexander sought help from James and John to write near-biblical verse. I recently recruited the help of three young co-op leaders for one letter.

So, what kind of expectations have been created along this path? Well, from the introductory issue, there is this:

Respect and Appreciation for the Cooperative Business Model

Over the decades, credit unions have modified their self-concept from being part of a purpose-driven social movement to something more akin to being participants in a confederation of increasingly independent and competitive financial institutions. At a time when consumers are looking for alternatives to Wall Street and Washington, I worry that credit union leaders under-appreciate the strategic differentiation power of the cooperative business model. We can’t (won’t) go back to the purity of the Rochdale weavers. Cooperatives must innovate to thrive, including with their structures. How can/should leaders forge thinking in a way that credit unions regard the cooperative business model as an indispensable asset?

I worry that credit union leaders under-appreciate the strategic differentiation power of the cooperative business model… How can/should leaders forge thinking in a way that credit unions regard the cooperative business model as an indispensable asset?

Extending the Sixth Cooperative Principle

From those weavers, Principle #6 speaks to “Cooperation Among Cooperatives.” Credit unions have a long history of cooperation within their own tribe. But there are cooperative (and co-op-like) organizations in virtually every sector of the economy. From my work with the National Cooperative Bank and international learning journeys, it has become obvious that U.S. credit unions are not sufficiently engaged with the other co-op sectors. And, truth be told, their willingness to cooperate with each other could probably stand some improvement. I hope to be involved with initiatives that bring CUs into better cooperation, especially with the non-CU cooperative sectors. Working together, co-ops could significantly impact local economic well-being. Thanks in no small part to coordination among co-ops, unemployment is considerably lower in northern Spain and the Emilia Romagna region of Italy.

I hope to be involved with initiatives that bring CUs into better cooperation, especially with the non-CU cooperative sectors. Working together, co-ops could significantly impact local economic well-being.

It was originally envisioned that the Principle 6 Newsletter would be focused on provoking thought among credit union leaders. There would be lessons brought in from other sectors and other countries from time to time, but the language would be inside (i.e. CU) baseball. There would be connections to cooperative identity as articulated by the International Cooperative Alliance and others, but the idea that being a co-op is good competitive strategy was imagined as the better currency for making impressions and achieving legitimate consideration. As for initiatives for bringing better cooperation, podiums, not programs, were the extent of imagination. Suffice it to say, there wasn’t anything akin to constitutional ratification in the early aspiration.

From the beginning, this newsletter was shared with a few others in the broader co-op community—friends made along my four-decade path in cooperative finance. Soon, they informed me that many of the issues facing credit unions existed in other sectors of the co-op economy. Among them, Chuck Snyder (at NCB) and Doug O’Brien (at NCBA CLUSA) suggested that co-op leaders should address the issues of drift from cooperative identity and siloed interactions in the U.S. co-op community. In the 11th issue of this newsletter, we announced what was then called the Principle 6 Project. From that issue:

Fundamentally, we hope to be causal about generating more cross-sector collaboration among American co-ops. We believe that there is significant business opportunity to be mined for participating collaborators. For sure, there are common public policy issues that could benefit from collaborative attention. In addition, we think that, working together, co-ops can make enhanced contributions for members and their communities at the local level.

After six months of conversations with co-op leaders from all of the economic sectors, Phase 2 of the Principle 6 Initiative was launched in June of this year. Essentially, over the course of 24 months it is intended to validate that:

  • Co-ops are willing and able to collaborate cross-sector to achieve common objectives.
  • Large co-ops, their associations and in-sector support organizations consider cross-sector engagement to be strategically meaningful.
  • Participation in cross-sector collaboration leads to heightened appreciation for cooperative identity as a critical strategic advantage.

OK, it looks like the Principle 6 Newsletter might have provoked some thinking, probably elevated awareness around the issues of identity-as-strategy and cross-sector collaboration as opportunity. And, it might have been a contributor to the resolve for doing something about those issues. It might even be the case that the newsletter has opened a few eyes to the importance of understanding and embracing cooperative identity in all of its “constitutional” meaning. But let’s not push comparisons with the Federalist Papers beyond reason.

That Hamilton asked for help in making the case for ratification does trigger an idea, however.

Every initiative requires a vision. Perhaps the Principle 6 Newsletter could someday become regarded collectively as the Cooperativity Papers. “Cooperativity” is a term from biology that means “the quality of being cooperative.”

To fulfill that sort of vision, there would need to be additional authors to enhance content and to extend legitimacy. With that in mind, the father of thought in the credit union sector around a potential 8th cooperative principle (elevating attention to DEI) Maurice Smith and the only U.S. member of the ICA Board of Directors and a long-time leader in the energy sector Martin Lowery have agreed to author some future issues of the Principle 6 Newsletter. Madison and Jay are in the house! I hope you will enjoy their contributions over the next 40 issues.

And maybe, someday, Alfredo, Christian and Savanna (the aforementioned young co-op leaders) will publish a book called the Cooperativity Papers.

Stay tuned,
Mike

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