SOLVING CHALLENGES TOGETHER CO‑OPERATIVE INITIATIVES IN CANADA 1 One of the best things about the economic role of STABLE co‑operatives is the fact that ECONOMIC our model produces growth with smaller fluctuations 3X GROWTH allowing communities and employees to enjoy more security and stability. Between 2009 and 2010, co‑operatives added 8.7% value‑add – nearly triple the 3.3% growth rate of the economy. SOLVING 1 CHALLENGES TOGETHER GENERAL CO-OPS JOBS 130,774 123,183 Co‑operatives employed 270,000 Canadians directly in 2010. CREDIT UNIONS Our direct contribution to GDP was $22.5 Billion. 3.8% 614K 109,596 111,912 Of all jobs in Canada. Full-time equivalent jobs. CO-OP INSURANCE + INVESTMENT 29,451 107,988 FTE, PERSON-YEARS DIRECT INDIRECT CO-OP PRODUCTION TAXES PRODUCT TAXES 2,686 635 TAXES Taxes paid by co‑operatives at local, provincial, and federal levels, HOUSEHOLD INCOME TAXES as well as taxes induced by other spending, provide nearly $11.68 billion in revenues for governments. $11.6 Billion 5,481 Generated for government services. HOUSEHOLD SALES TAXES PROPERTY 2,432 449 TAXES $ MILLIONS GENERAL CO-OPS ECONOMIC VALUE ADD TO GDP 7,408 10,851 Co‑operatives, credit unions and co‑operative insurance CREDIT UNIONS companies had a direct economic impact (GDP) of $22.508 Billion in 2010 – and through spinoff impacts, the overall impact to the 3.4% $54B 8,333 11,218 Of Canada’s total In value-add created Canadian economy was $54.631 billion. This represents about 3.4% of Canada’s total economic activity in 2010. value-add. in the economy. CO-OP INSURANCE + INVESTMENT 6,767 10,075 GDP, $ MILLIONS DIRECT INDIRECT Source: Economic impact analysis of co‑operatives in Canada for the years 2009 and 2010, Karaphillis and Duguid 2 We recognize the vitally important role that ‘‘ co‑operatives play in our economy and in THE CO‑OPERATIVE communities across the country. MODEL IS NOT With over 18 million Canadians who are members AN EXPERIMENT of the more than 9,000 co‑operatives across the IN CANADA. country, these innovative enterprises create jobs and contribute to regional economies where ITS POTENTIAL private businesses would not see the desired IS PROVEN. returns on equity – particularly in rural areas. — Justin Trudeau, Co‑op Week message 2015 SOLVING 3 CHALLENGES TOGETHER IN CANADA Our members help provide steady growth in the economy, fill gaps in rural and remote communities, build enterprises that can compete globally, and contribute to social and environmental progress. There are 9,000 co‑operatives and mutuals in Canada, and 18 million of us are members of a co‑operative. Find out how we can help with just about anything the Canadian imagination can dream of doing. AROUND THE WORLD Co‑operatives are thriving and providing economic opportunity and social benefits. Here at home, you might not realize that some of the most useful and successful enterprises are co‑operatives. 250 MILLION JOBS WORLD‑WIDE $2.9 TRILLION DOLLARS (USD) WORLD‑WIDE TOTAL TURNOVER IN 2013 4 Political debate in recent years has been marked by a discussion of whether it’s possible to have strong THE enterprises and achieve a broad range of social and community goals as well. POTENTIAL OF Canadians know this is not only desirable, but CO‑OPERATIVES entirely possible. The co‑operative approach has proven to be remarkably successful, building FOR global class companies that provide hundreds of CANADA thousands of great jobs, as well as anchoring local enterprises in rural and remote communities. Our members have shown that a triple bottom line is not a dream, but a reality we can expand. SOLVING 5 CHALLENGES TOGETHER BURNING ISSUES TO WHICH WE CAN CONTRIBUTE SOLUTIONS. Some of the most important challenges Canada faces are tailor made for co‑operative solutions, and our members are happy to participate in the debate about how best to accomplish national goals: AFFORDABLE OPPORTUNITY MORE MORE LINKING TRADE HIGH SPEED FOR FIRST RENEWABLE ENTREPRENEURIAL OPPORTUNITY BROADBAND NATIONS ENERGY SOURCES OPPORTUNITIES WITH PRODUCERS How can high speed broadband How can our future economic How can we harness the If large companies are hiring As Canada pursues more be built and offered affordably and social development provide desire to introduce more fewer young people, can open trade relations around in every corner of Canada? important, durable, shared renewable energy sources co‑operatives provide entry the world, how can opportunity with First Nations? into our lives and help reduce level and entrepreneurial co‑operatives help more emissions, affordably? opportunities? producers gear up to take advantage of the opportunities? 6 The co‑operative approach is a great fit for many of Canada’s top priorities as the country turns 150. HOW Whether its offering new models for the economic success of our cultural industries, and the creation CAN WE of new viable forms of news media, or clean energy DO MORE? enterprises to harness scientific and technological innovation, the possibilities are virtually endless. SOLVING 7 CHALLENGES TOGETHER OUR SIX POINT PLAN HOW CAN FOR SOLVING CHALLENGES GOVERNMENT TOGETHER: HELP? Co‑operatives and 1 CO‑OPERATIVE MODELS Create a national conversation on the idea of using co‑operative mutuals require attention, FOR STABLE GROWTH models to fill in gaps, create stronger more stable growth. encouragement and 2 INVEST IN INNOVATIVE Co‑finance collaborative initiatives that will achieve the support to thrive. It is in the CO‑OPERATIVE government’s priorities. Allow Canadians to more easily invest INITIATIVES in their co‑operatives and mutuals. Government of Canada’s interest to educate business 3 EXPLORE MODELS Promote the examination of co‑operative models in underserved FOR UNDERSERVED markets and underserved geographies. support personnel to MARKETS recognize when a business 4 LEVERAGE TRADE Ensure Canada’s co‑operative enterprises are directly engaged in opportunity is well suited OPPORTUNITY how to fully leverage the opportunities that new trade initiatives (e.g. China) may present. to collective or community ownership. 5 THE ROLE OF Consider fully the role that co‑operative enterprises can play in the CO‑OPERATIVES next stage of national policy on Innovation. These business support personnel should be IN NATIONAL POLICY aware of the co‑operative model and know how to direct co‑operative entrepreneurs to 6 RAISE AWARENESS These solutions can be more broadly used if better known, the services they need. Providing co‑operative OF THE CO‑OPERATIVE and government has the tools to help. entrepreneurs with equal access to programs MODEL and services, and to sources of capital should also be made a priority of the government’s Innovation Agenda. 8 We are ready to contribute to the design and delivery of the government’s planned Innovation Agenda on behalf of our members. THE The following suggestions reflect CMC’s initial assessment of how co‑operatives can deliver on INNOVATION policy objectives outlined in Budget 2016 and in AGENDA the Ministerial mandate letters: • As with any startup, incubating emerging co‑operative enterprises that need access to shared resources and advice in their formative period is crucial. The co‑operative and mutual sector offers specialized knowledge of by‑laws, governance, and business planning, along with technical assistance, advisory services, education and training. • Acceleration of high potential sectors, where co‑operatives are well established, can directly impact the success of the Government of Canada’s Innovation Agenda. Specifically, major opportunities exist in renewable energy (biomass, wind and solar), personal services (home care, seniors, health and wellness) and in the sharing economy (on demand service platforms in particular). Both the Industrial Research Assistance Program and the National Network for Business Innovation can embrace co‑operative clusters, resource sharing and investment in R&D for high potential and emerging sectors. SOLVING 9 CHALLENGES TOGETHER • The Government’s Social Innovation Strategy would benefit significantly by supporting the creation of new co‑operatives with a social purpose. Co‑operatives have always been a business structure preferred by communities as a solution to identified needs where private equity would not see the desired returns on investment. • Economic development for Indigenous and rural communities could see better and faster benefits by harnessing the co‑operative business model. The co‑operative and mutuals business model shares collective values with indigenous communities and also adapts well to opportunities in remote and rural settings. • An area of emphasis for co‑operative knowledge sharing networks is business succession. For business owners who will be retiring, transitioning to a co‑operative model can be an efficient exit strategy. Government support for education and proactive consulting services can facilitate business transitions in the coming years. CMC members – including well‑established co‑operative and mutuals organizations across Canada – are enthusiastic about playing an active role in the conception, planning and delivery of any proposed business development activities. Our development network exists in every region, urban and rural and works in almost In 1971, Mountain Equipment Co‑operative was founded by every economic sector. enthusiasts who saw a way to innovate in the retail sector to make high end climbing gear affordable in Vancouver. Today they serve over 4 million member owners by providing that same value, in addition to making real impacts on 10 environmental sustainability through Green Building and Responsible Sourcing programs. THE CO‑OPERATIVE MODEL IS NOT AN CANADIAN EXPERIMENT VALUES & IN CANADA. CO‑OPERATIVES ITS POTENTIAL IS PROVEN. SOLVING 11 CHALLENGES TOGETHER The history of Canada is a unique story of a small population building a great economy and a generous society. The values of communitarianism and entrepreneurship have blended well in this country, and this mix will be even more important in the future.