Beware of the gorilla!
April 2005
Globalization is here to stay, with or without cooperatives. That’s just the way it is. Enrolled in a formidable marathon, businesses are relentless in seeking to improve their performance and to display increased profitability recognition on the world stage. Cooperatives have not been spared and willingly accept this new challenge because they have to as a way to ensure their legitimacy with the competition, and respond ever moreefficiently to the needs of their members.

Consequently, this leads several businesses to search for improved cost-effectiveness and go beyond their boundaries of origin and acquire additional volumes or learn to produce under more constructive conditions. But expanding beyond cooperative boundaries, a relatively new concept, is not without concern. How is this sudden internationalisation of cooperatives being accomplished? Which values are guiding these cooperatives as they operate in these new environments? Are there development strategies specific to cooperative enterprises?

Often, when cooperatives choose to expand, they acquire already existing businesses and manage them as distinct and capitalist subsidiaries. Pretty hard to formalize: as soon as someone wants to acquire a business that is not born of a cooperative endeavour and a desire to take charge of itself and provide its own services, that same business cannot, at least in the short term, be transformed into a cooperative. Although they’ve organized user participation, the whole seems rather artificial. Mobilizing people and wishing for greater accountability are not rules of conduct that can be decreed by a new administration. It needs to be part of the foundation. And that’s not always possible.

This said, we must also acknowledge that this type of cooperative development, through subsidiary management, requires great vigilance. The fact that the parent cooperative and its subsidiary aren’t operating along the same principles could, in fact, lead to confusing management. Obviously, the subsidiary can, at the beginning of the venture, share the same values of the parent company. However, if the subsidiary is not directed by guidelines that make the needs of the people more important than accumulating capital, history has proven that in the long term, there is often a general breakdown of values in favour of a purely capitalist logic. It’s as if there a huge black hole exists, a brutal force in which the insertion of a finger results in the total absorption of the body and its surroundings! Just the other day, someone said, rather amusingly: “If you’re making love to a gorilla, you don’t stop when you’re done, you stop when it’s done”. There. When you get on the capitalist merry-go-round, it’s hard to get off. So what? Well, this means that the cooperative message becomes difficult to interpret, albeit incomprehensible.

To avoid sinking into schizophrenia, cooperatives must make sure that a proper set of rules guided by the cooperative ideal are in place for their respective subsidiaries. And, when possible, emphasis on development and expansion beyond boundaries should be prioritized through the cooperative formula. This is just logical. If cooperators really want a more reasonable globalization, fair trade and greater political stability, the cooperative formula is the best way to go. Because a cooperative is equipped with self-governing mechanisms, which provide protection from market upheavals: democracy, education, independence, commitment to their environment, all serve as a call to order and as an invitation to exceed and to excel that it cannot ignore.

We should use Euresa as an example. Created in 1990 by a group of four European insurance companies and to which three other companies have since joined. The desired expansion was achieved within a greater alliance where each company continues to live its mutuality. In the latest issue of Alternatives économiques, Camille Dorival brings forth the notion of pooling the resources and the know-how of each partner. In fact, this venture made possible “the same kind of savings as those achieved by multinational groups, stated Mr. Dorival, and allowed each mutual to pursue development within its own market while maintaining its corporate culture…”

The strategy could be referred to as a creation of alliances, inter-cooperation, trans-national network approach, whatever. It’s an advisable strategy because it respects the distinctive nature of the parent company and the intention of those who support it in good faith. Our cooperatives must become creative, in spite of their minority status in the marketplace. Don’t we, in the cooperative movement, say that we have a talent for innovation? Then we should be able to achieve our own affirmations. Thanks, but no thanks Mr. Gorilla!

Colette Lebel, agr.
Director of Cooperative Affairs
La Coop fédérée
Fax: (514) 858-2025


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