Co-ops comprise a fundamental component of our business culture not only because they hold the gold standard of “stakeholder capitalism” but because doing well by doing good makes so much sense financially.
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My path to adulthood led through the food co-ops of Burlington, Vermont, and Boulder, Colorado, where, as a young adult on a tight budget, I bought much of my groceries.
In exchange for lower prices on quality food, I volunteered my time to stock the shelves, clean the floors or do anything else that needed to get done.
While it worked for me, it left me with a skewed view of the cooperative business model as though it were stuck swirling around in an eddy of some sort of capitalist backwater.
Nothing could be further from the truth. Co-ops comprise a fundamental component of our business culture not only because they hold the gold standard of “stakeholder capitalism” (sorry Business Roundtable, you’re a bit late to this party), but because doing well by doing good makes so much sense financially.
My private professional experience as a business and financial litigator combined with my public service in financial services and taxation opened my eyes to see that American cooperative businesses are uniquely American. As the leader now of the Credit Union League of Connecticut, representing nearly 100 cooperatives throughout the state, I continue to see this firsthand every day.
From Sunkist, to Cabot Creamery, to REI, and to every credit union in Connecticut, co-ops contend with natural market forces and unnatural regulatory pressure just as traditional corporations do. Most of them compete fiercely with each other for market share and profit margin.
If it sounds like classic capitalism, it should. Only it’s also capitalism with a clear focus on the duty to serve the best interests of their members, vendors, employees and communities.
When everybody wins, well, everybody wins.
In fact, the capitalist cooperative may emerge as one of the brighter spots in the economic recovery from the COVID-19 pandemic, and here is why.
America is exhausted right now. Having borne decades of chronic partisan skirmishes that allowed divisiveness to overtake unity, and after months of tragically acute economic and physical assaults from a wicked global virus, we are weary, divided and grieving.
But the light of hope still shines. Lady Liberty’s torch stands high in New York Harbor, providing a beacon to those searching the horizon for American soil.
The same torch illuminates our shores and lights a fire in each of us, reminding us that we are bound together as Americans. While we cannot expect in this moment that America will rise up in full unified cooperation to defeat this epidemiological enemy and resolve this deep political divide, we can still help to make things better.
How? In the business community, we can help by supporting cooperative businesses, big and small, locally and nationwide.
Cooperative businesses embody America as the Land of Opportunity. To the cooperative, a consumer is not just potential revenue in human form. Cooperatives beckon us to join them in search of mutual benefit.
The “pulling yourself up by your own bootstraps” theory is a myth — like a team of horses, cooperatives harness the power of affiliation to compete in the marketplace and, when they win, they share the progress with the very people that fueled the success.
If that does not sound exceptionally American, nothing does.
American cooperatives are beacons of financial hope that will strengthen our economic recovery and prove the American resiliency that remains deeply embedded in our communities.
While cooperatives can be found across our entire economic spectrum, from agriculture to pharmacies and from energy to sporting goods, credit unions, as financial cooperatives, do not ask people to perform the impossible feat of pulling themselves up by their own bootstraps.
Instead, credit unions allow their members to pool their deposits and then lend that money out to other members. When there are no outside investors to divert the profits, the member wins.
Capitalism. The cooperative way.
This virus is weakening and our economy is improving. As you consider where to spend your money in this time of recovery, consider where the profits go.
For my part, I’ll be looking for a cooperative.
Bruce Adams is the president and CEO of the Credit Union League of Connecticut.
