The history of the cooperative movement concerns the origins and history of cooperatives across the world. Although cooperative arrangements, such as mutual insurance, and principles of cooperation existed long before, the cooperative movement began with the application of cooperative principles to business organization.
Beginnings
spread in Greece earlier than in other European countries. During the 18th century, a particular form of cooperative organization was developed in certain areas under Ottoman sovereignty. It was associated with specific agricultural or craft products destined to international markets. Derived from the Byzantine guilds, it was favored by the Ottoman administration because it was enabling better control of the production and tax collection. The Common Company (Syntrofia) of Ambelakia (1780 to 1812), established in Thessaly and providing Europe with high quality red cotton yarns, is typical of this system. Its development was related with a dyeing technique using the roots of the wild madder (ριζάρι, Rubia tinctorum) and providing an indelible and shiny color. 22 villages possessing 24 factories participated to the Syntrofia, which had 6000 individual members: financiers and landowners providing for capital and land, technicians providing know-how, workers providing labor. It operated several branch stores abroad (Amsterdam, Dresden, Hamburg, Leipzig, Odessa, London, St. Petersburg...). In 1810, its capital amounted to 20 000 000 gold francs, deposited in the Bank of Vienna. Other well-known cooperatives established in Greece during the Ottoman period, are the Shipping Guilds of the islands Hydra, Spetses and Psara; the Community of Mantemi, exploiting the mines of Chalkidhiki (Macedonia); and the Community of “Mastic Villages” (Μαστιχοχώρια) de Chios (North Aegean), whose activities were based on the mastic - a resin extracted from the mastic trees, growing only on this island and used for cosmetic, culinary and medicinal purposes.
In the rest of Europe, primarily in Britain and France, the cooperative movement began mainly in the 19th century. The Industrial Revolution and the increasing mechanisation of the economy transformed society and threatened the livelihoods of many workers. The concurrent labour and social movements and the issues they attempted to address describe the climate at the time.
The first documented consumer cooperative was founded in 1769, in a barely furnished cottage in Fenwick, East Ayrshire, when local weavers manhandled a sack of oatmeal into John Walker's whitewashed front room and began selling the contents at a discount, forming the Fenwick Weavers' Society.
In 1810, Rev. Henry Duncan of the Ruthwell Presbyterian Church in Dumfriesshire, Scotland founded a friendly society to create a cooperative depository institution at which his poorest parishioners could hold savings accounts accruing interest for sickness and old-age, which was the first established savings bank that would be merged into the Trustee Savings Bank between 1970 and 1985.
In the decades that followed, several cooperatives or cooperative societies formed including Lennoxtown Friendly Victualling Society, founded in 1812.
By 1830, there were several hundred co-operatives. Some were initially successful, but most cooperatives founded in the early 19th century had failed by 1840. However, Lockhurst Lane Industrial Co-operative Society (founded in 1832 and now Heart of England Co-operative Society), and Galashiels and Hawick Co-operative Societies (1839 or earlier, merged with The Co-operative Group) still trade today.
It was not until 1844 when the Rochdale Society of Equitable Pioneers established the "Rochdale Principles" on which they ran their cooperative, that the basis for development and growth of the modern cooperative movement was established.
Financially, cooperative banks, called credit unions in the US, were invented in Germany in the mid-19th century, first by Franz Hermann Schulze-Delitzsch (1852, urban), then by Friedrich Wilhelm Raiffeisen (1864, rural). While Schulze-Delitzsch is chronologically earlier, Raiffeisen has proven more influential over time – see history of credit unions. In Britain, the friendly society, building society, and mutual savings bank were earlier forms of similar institutions.
Robert Owen
Robert Owen (1771–1858) is considered as the father of the cooperative movement. A Welshman who made his fortune in the cotton trade, Owen believed in putting his workers in a good environment with access to education for themselves and their children. These ideas were put into effect successfully in the cotton mills of New Lanark, Scotland. It was here that the first co-operative store was opened. Spurred on by the success of this, he had the idea of forming "villages of co-operation" where workers would drag themselves out of poverty by growing their own food, making their own clothes and ultimately becoming self-governing. He tried to form such communities in Orbiston in Scotland and in New Harmony, Indiana in the United States of America, but both communities failed.
William King
Although Owen inspired the co-operative movement, others – such as Dr. William King (1786–1865) – took his ideas and made them more workable and practical. King believed in starting small, and realized that the working classes would need to set up co-operatives for themselves, so he saw his role as one of instruction. He founded a monthly periodical called The Co-operator, the first edition of which appeared on 1 May 1828. This gave a mixture of co-operative philosophy and practical advice about running a shop using cooperative principles. King advised people not to cut themselves off from society, but rather to form a society within a society, and to start with a shop because, "We must go to a shop every day to buy food and necessaries – why then should we not go to our own shop?" He proposed sensible rules, such as having a weekly account audit, having 3 trustees, and not having meetings in pubs (to avoid the temptation of drinking profits).
Rochdale Pioneers
The Rochdale Society of Equitable Pioneers was a group of 10 weavers and 20 others in Rochdale, England, that was formed in 1844. As the mechanization of the Industrial Revolution was forcing more and more skilled workers into poverty, these tradesmen decided to band together to open their own store selling food items they could not otherwise afford. With lessons from prior failed attempts at co-operation in mind, they designed the now famous Rochdale Principles, and over a period of four months they struggled to pool one pound sterling per person for a total of 28 pounds of capital. On December 21, 1844, they opened their store with a very meager selection of butter, sugar, flour, oatmeal and a few candles. Within three months, they expanded their selection to include tea and tobacco, and they were soon known for providing high quality, unadulterated goods.
English CWS and Co-operative Group
The Co-operative Group formed gradually over 140 years from the merger of many independent retail societies, and their wholesale societies and federations. In 1863, twenty years after the Rochdale Pioneers opened their co-operative, the North of England Co-operative Society was launched by 300 individual co-ops across Yorkshire and Lancashire. By 1872, it had become known as the Co-operative Wholesale Society (CWS). Through the 20th century, smaller societies merged with CWS, such as the Scottish Co-operative Wholesale Society (1973) and the South Suburban Co-operative Society (1984).
By the 1990s, CWS's share of the market had declined considerably and many came to doubt the viability of co-operative model. CWS sold its factories to Andrew Regan in 1994. Regan returned in 1997 with a £1.2 billion bid for CWS. There were allegations of "carpet-bagging" – new members who joined simply to make money from the sale – and more seriously fraud and commercial leaks. After a lengthy battle, Regan's bid was seen off and two senior CWS executives were dismissed and imprisoned for fraud. Regan was cleared of charges. The episode recharged CWS and its membership base. Tony Blair's Co-operative Commission, chaired by John Monks, made major recommendations for the co-operative movement, including the organisation and marketing of the retail societies. It was in this climate that, in 2000, CWS merged with the UK's second largest society, Co-operative Retail Services.
Its headquarters complex is situated on the north side of Manchester city centre adjacent to the Manchester Victoria railway station. The complex is made up of many different buildings with two notable tower blocks of New Century House and the solar panel-clad CIS tower.
Other independent societies are part owners of the Group. Representatives of the societies that part own the Group are elected to the Group's national board. The Group manages The Co-operative brand and the Co-operative Retail Trading Group (CRTG), which sources and promotes goods for food stores. There is a similar purchasing group (CTTG) for co-operative travel agents.
U.S. Co-operatives
The United States first known Co-op was the mutual fire insurance company founded in 1752 by Benjamin Franklin. The first dairy co-op was founded in 1810 with small locals found nationwide by 1866. The first known consumer co-op in 1845 was Boston's Workingman's Protective Union. The country's first organization to promote cooperative values and the Rochdale Principles was the Order of the Patrons of Husbandry, known as the Grange that started after the Civil War. The co-operative movement grew during the 1890s in response to the expansion of large corporate monopolies. The country's first credit unions were in Massachusetts while The Cooperative League of the United States of America, known today as the National Cooperative Business Association was organized in 1916 to promote cooperatives. In the late 1960s the Co-op movement entered a new phase with Food cooperatives and Food Conspiracies as an alternative to corporate agriculture that linked organic farmers to urban consumers.
The co-operative model has a long history in the U.S., including a factory in the 1790s, the Knights of Labor, and the Grange.Curl, John History of Work Cooperation in America CA: Homeward Press, 1980. In Colorado, the Meadowlark cooperative administered the only private free land program in the United States, providing many services to its members who buy and sell together. In New York City, several food co-operatives were founded around 2010, adding to others, some existing since the 1970s.Ronco, WC 1974 Food Co-ops; Knupfer, AM 2013 Food Coops in America; Greene Hill Food Co-op, Brooklyn, NY ; Food Co-op Initiative The U.S. has some diverse worker co-operatives, such as a home care agency, an organic bread factory co-op and an engineering firm.Moore, M. (2009) film Capitalism: A Love Story. Some have already incorporated environmental and/or Fair Trade criteria into their products, such as the aforementioned bread-maker, Organic Valley, and Equal Exchange.Kelly, M. (2012) Owning Our Future.
Credit unions were established in the U.S. by 1908. Their member-owned, co-operative structure created stable governance structure, so that they were only slightly affected by the 2008 mortgage securities crisis.