Cooperative principles as nutrients of business innovation

When we refer to business innovation, we can tackle this matter from very distinct focuses: the opening of a new market, a new production method, a new product or service, etc… or, in a broader sense, the creation of a new organisation. It is in this latter sense that I will focus when I refer to the term innovation as well as its close proximity to the cooperative business model, so deeply-rooted in the Autonomous Basque Community. Innovation supposedly refers to something new, something different, Cooperatives as an alternative to capital enterprises.

The innovative wealth of Cooperatives has, among others, three angles which integrated place it advantageously in the socio-business panorama. Human wealth where the persons (and not the capital) are the pillar on which the whole economic and social structure of the company is developed; a basilar wealth, appropriate to confront the challenges of change, which leans on and gains strength from the cooperative principle of education, training and information, a cooperative principle that irrigates the insides of the cooperative enterprise, oxygenating it and promoting its economic and social development; a relational wealth, which finds its spring and renovating stream in the principle of inter-cooperation or permanent cooperation between Cooperatives. The Cooperative Experience of Mondragon, the great benchmark, not only Basque but worldwide, of associated work cooperativism is largely the result of a permanent practice of a deep inter-cooperation between Cooperatives.

In reality, delving into cooperative principles, it is an especially adequate tool for innovation and, consequently, with which to achieve business competitiveness. Cooperative principles which are the particularity and the essence of Cooperative enterprises. But, which are also are a valuable asset.

The innovative value of the principles referred to training and cooperative inter-cooperation, to which I referred, is considerable but no less than the value of the other principles.

Hence, the principle of democratic management (one person, one vote) incorporates fully the human capital in the business project strengthening solidarity, active participation in establishing the polices and in taking decisions and co-responsibility. Democratic and participative management is management that is consistent with the society of knowledge, where the totality of the members must be active agents in the mechanisms of information transmission and decision taking.

The principle of autonomy and independence also reinforces the free and sovereign character of Cooperatives, a synthesis of liberty and internal cohesion and the principle of interest in the community, guides the innovation of Cooperatives towards the sustainable development of the communities where they are rooted. In other words, they are enterprises that are rooted in the environment and committed to its development, and consequently removed from processes of industrial delocalisation, processes that increase the abandonment of these communities.

Cooperatives incorporate a differential element, namely the free association and deliberation among equals. From this point of view it is a typically modern organisation.

The cooperative business model truly possesses great strengths to be the paradigm of a ground-breaking enterprise. Creativity, which is the basis of innovation, is not primarily in the capital or in the machines, but in the people, and Cooperatives are enterprises of people who put their creativity at the service of the common project.


Agustin Mendiola
Director of ERKIDE
Basque Worker, Teaching, Consumer and Credit Cooperatives Federation

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