The Cooperative Code

The cooperative organisation is a form of joint business management. In a cooperative, members work together to achieve more than each individual can do on their own. It is often an extension of their own company. We see cooperatives in all kinds of sectors, large and small. There are cooperatives of private individuals, governments, employees or combinations of all of the above. In all cases, it concerns an association with a company. And in all cases, there is a vision at the basis, a well-understood self-interest anchored in collectivity. Through cooperation, advantages are achieved that cannot or can be achieved less individually. Advantages such as a better market position or risk limitation, but also better information or social purposes.

The collective enterprise is seen as an intelligent economic solution but is not the easiest in its nature. The aim is to carefully weigh up individual interests in a balance between the members, any management, directors and supervisors. In addition, the cooperative has various management models. Not every cooperative has the same relationships, task division and role fulfillment. They do have in common that their primary goal is formulated in a shared member interest and underlying vision. Cooperatives can therefore learn a lot from each other’s practice and do so: regionally, nationally and internationally as well as sectorally and differently in size and member types.

To help balance the interplay between the various powers within a cooperative, the cooperative enterprises have a code. The National Cooperative Council (NCR) is the initiator and penholder of this Code as an advocate for the Dutch cooperatives.

The first Cooperative Code was developed by NCR in 2005. The reason was the need of cooperatives for their own code that offers support and inspiration. After all, the cooperative differs from the capital company in terms of purpose, values and organisation. Generally, members of a cooperative enterprise are more involved in the cooperative, there is less absence from member meetings and the members are involved in decision-making at an earlier stage.

The 2005 Cooperative Code was revised in 2019. In 2024, recent developments and changed (social) insights, such as sustainability, have led to the Cooperative Code being adjusted again on a number of points. Although the characteristic cooperative principles have remained largely unchanged, it has been decided to better express a certain focus, particularly in the Regulations. This current Code is therefore an updated version of the 2019 Code.

The Cooperative Code is intended for all cooperatives affiliated with the National Cooperative Council (NCR), large and small, regardless of the sector in which they operate or the management model used. Because the Code aims to function as a tool to improve cooperative entrepreneurship, member involvement and collectivity, the aim is for the Cooperative Code to be complied with by other cooperatives as well. After all, the Principles and Regulations are generally usable and widely applicable.

Cooperatives need their own code because:

The Cooperative Code aims to contribute to the improvement of cooperative entrepreneurship, member involvement and collectivity. The Cooperative Code deliberately does not contain an extensive (tick-off) list of commandments and prohibitions, but is based on principles. This is in line with current social voices regarding codes. The Cooperative Code aims to stimulate discussion among the cooperatives and within the cooperative internally, among both its directors and its members.

The Cooperative Code consists of three parts: Principles, Regulations and Good Practices.

The Principles are characteristic of the cooperative legal form. They relate to cooperative entrepreneurship (the cooperative runs a business), collectivity and reciprocity (the members work together with each other and with the cooperative, which leads to added value) and the basis of the cooperative: member involvement.

The Regulations contain rules of conduct or further provisions that describe a more concrete interpretation of the Principle. Implementing these in the cooperative will promote the functioning of and cooperation within the cooperative.

In order to support and facilitate cooperatives in implementing the Principles and Regulations, in choosing a specific model and in further organising the structure of the cooperative, various applications and elaborations have been collected. These Good Practices are intended as a guideline, for inspiration and as tools. Whether or not to apply the Good Practices is at the discretion of the cooperative. The Principles and Regulations are leading and apply to all cooperatives, across all sectors, regardless of the size of the cooperative.

The Cooperative Code is based on broadly supported cooperative principles and codes of conduct. These are not optional: NCR members are expected to comply with the Principles and Regulations of the Cooperative Code.

NCR asks its members to annually account to their own members for the follow-up of the Cooperative Code and for the considerations underlying it: the application and compliance with the Cooperative Code is annually placed on the agenda by the cooperative and provided with an explanation and motivation in the annual report.

Members hold their cooperative accountable for compliance with it and cooperatives also hold each other accountable for this. The Cooperative Code is considered successful if it leads to awareness of the idea that underlies it on the one hand, and to a lively dialogue within and outside the cooperative on the other.

Would you like to have all the information about the Cooperative Code at your fingertips? Click on the image below to open the brochure.

Further support by NCR

The provisions of the Code are the result of thorough research and collected Good Practices during the 90-year existence of NCR. NCR is happy to assist its members and other cooperative enterprises in applying this Code, answering questions, and welcomes suggestions.

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