According to a new report by the Worldwatch Institute, approximately 1 billion people in 96 countries now belong to a cooperative. The report’s author, Gary Gardner, writes that cooperatives are low-profile but powerful economic actors, with the world’s 300 largest ones generating revenues in 2008 of more than $1.6 trillion.
If these businesses were a national economy, they would rank ninth in the world—ahead of the economy of Spain. The report also reveals that 99% of cooperative businesses operate primarily within seven economic sectors namely Agriculture/Forestry, Banking/Credit Unions, Consumer/Retail, Insurance, Workers/Industrial, Health and Utilities.
The report also notes that the cooperative model surpasses the shareholder model in at least one area: the 1 billion member-owners of cooperatives worldwide exceed the 893 million direct and indirect shareholders of corporations.
If direct shareholders, who own stock as individuals, are considered alone, they are outnumbered three to one by cooperative member-owners. In fact, 13.8% of the world population is a member of at least one cooperative, in contrast to the 5% who are direct shareholders. Looking at national figures, some countries have a very high proportion of cooperative membership, for example: Ireland (approximately 70% of the population), Finland (60%), Austria (58%), Singapore (50%), Switzerland (46%), Sweden (45%), Norway (44%), and Canada (40%).
The report notes that cooperatives are particularly strongly represented in the financial realm. A 2010 World Bank report found that credit union branches account for 23 percent of bank branches worldwide and serve 870 million people, making them the second largest financial services network in the world.
The report goes on to say that cooperatives in the financial sector are valuable because they offer access to savings, loans, and other financial services to small and medium enterprises, particularly in rural areas, which lowers a key barrier to economic development in the poorest sectors of many economies. In fact, the report shows that 45% of the branches of financial coops are located in rural areas, compared with 26% of branches of commercial banks.
By designating 2012 the International Year of Cooperatives, the United Nations (UN) has placed a spotlight on the cooperative model. The report concludes by saying that governments and the civil sectors of many countries are active in promoting the cooperative model. In the United States, for example, the National Cooperative Development Act was introduced in Congress in late 2011 to stimulate further development of the cooperative sector by providing it with seed capital, training, and resources.