etc

education, training and consultancy

1
Page

Name:
 FOREWORD
They may be community leaders or followers, seminar
facilitators or participants, but what gave form and substance to
this Handbook on Basic Cooperative Education were the varied
experiences of all these learners. It is a product of the people
involved in the success and failures of organizations in the aspect
of cooperative organizing and membership education.

This Handbook is not meant to be perfect, but rather to be

perfected by its constant application by the users. Revisions are
expected so as to fit the changing situations, both internal and
external, and answer the felt needs of the community-based and
self-help organizations. It is designed as a supplementary
material to be used by the cooperative organizer, trainer or
educator.

The content of this Handbook will be of great help to clearer

understanding by the learners when popularized, translated and
shared in the dialect.

Lastly, users of this Handbook are encouraged to equip

themselves with the needed exposure and experience for them to
go beyond the content of this material and explore some other
aspects in membership education, leadership formation and
cooperative development. In doing such, this Handbook will be
set for its first revision and will be on its path to perfection, with
you as a resource person.

rudzmvillanueva
0917-3221354, 0919-8299067
2

email: rvillanueva@uspf.edu.ph
Page

zdurmv@yahoo.com
 Your satisfaction,
our passion.

Course Outline
A. WHY CO-OPERATIVE?
Poverty and Abundance
Human Dignity and Social Justice
Self-Help and Group Action

B. WHAT IS A CO-OPERATIVE?
Definition
Types of Cooperatives
Nature and Purpose of Cooperatives
Cooperative Philosophy, Principles and Practices
C. HOW TO MANAGE A CO-OPERATIVE?
Articles of Co-operation
Cooperative Structure and By-Laws
- Duties and responsibilities of officers
- Task and functions of the BOD and
Committees
Success and Failure Factors of Cooperatives
- The Eight Cooperative Elements
Mechanics of Co-operative Organizing
3
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 Freelance ETC
Education, Training & Consultancy

Poverty and Abundance

Sub-topics:

➢ the exploitative situation

(local, national and global situationer)
➢ causes and effects of exploitation
➢ internal and external causes of poverty
➢ the cooperative idea

CAUSES OF POVERTY
A. Internal Causes
➢ Lack of education
➢ Lack of savings for capital
➢ Bad habits: gambling, alcoholism, extravagance, etc.
➢ Lack of initiatives
➢ “fatalism”
➢ Big family, extended family
➢ Laziness
➢ Lack of perseverance
➢ Disorganized, individualism
➢ Etc.
B. External Causes
➢ Import-dependent and export-oriented economy
➢ Foreign debt
➢ No equal access to opportunities
➢ Unequal distribution of wealth
➢ Unrestrained capitalism
-exploitation of laborers
-exploitation of consumers
➢ etc.
4 Page
EFFECTS OF POVERTY
1. Exploitation of the Poor
A. In one’s credit needs
-usurers
-pawnshops
-banks
B. in one’s consumer needs

-higher prices when items are bought in credit

-cheating on the weight and measurement of goods

-higher prices caused by hoarding and price manipulation

C. in the marketing of goods that they produce

D. in their needs for services

-housing/land acquisition
-transportation
-health/hospital
-others

B. Lack of Development of the Human Person

-social, culturally, politically, economically, and spiritually

Factors that results in exploitation Possible solutions

1. Poverty >resource mobilization, capital build-up

2. Individualism >organization, group action

3. Ignorance >education, information sharing

The organization formed:

➢ Must provide each one with the help to achieve liberation but not
at the expense of others
➢ Must be based on the principle of helping each other rather than
each one to himself.
➢ Must be aimed not only at helping individuals to develop
themselves, but also the community and the nation.
➢ Must not show discrimination against sex, religion, or political
5

affiliation
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 ➢ Must promote ecological balance
➢ Must encourage and promote generation of internal
capital/resources.

notes

EFFECTS OF POVERTY

Lack of development of the human person resulting from

bondage:

SOCIALLY- low self-image, inferiority

POLITICALLY- default in decision-making, vote-
buying/selling, patronage politics
ECONOMICALLY- feeling of hopelessness, despair
CULTURALLY- class distinctions/division
SPIRITUALLY- dichotomy, fatalism, God’s will
ENVIRONMENTALLY- survival for the fittest,
greed, no respect for natural laws
6

GENDERLY- overburdened women and exploitation

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 P Prostitution, drug addiction and other social ills are
but symptoms of a floundering economy and
deteriorating culture.

• No protectionist policies for small

Filipino entrepreneurs
Some Issues Deeply Embedded
In Philippine Society That
Chained Filipinos To Poverty

SOCIAL

• Social stratification/disintegration
• Exploitation CULTURAL
• Unequal treatment between the rich
and poor • Subsumed Filipino culture
• Individualism • Patronage syndrome
• Regionalism • Come what may
• Colonial mentality
POLITICAL • Cultural prostitution

• Culture of silence SPIRITUAL

• Powerlessness
• Few elite holds political power
• Leadership lacks political will
• Corrupt political leaders
• Government is not responsive to
people’s needs
ECONOMIC
• Unrestrained capitalism
• Foreign dependence
• Debt mentality
• Export-orientation & import
dependence
• Disillusionment
• Fatalism
• No close relationship with God
• Split Christian mentality
ENVIRONMENTAL
• Indiscriminate destruction of natural
resources
• Wanton destruction of marine lives
• Fast denudation of forest reserves
• Slash and burn by upland dwellers
• Lethal fishing means
•
7

• Bulging foreign & domestic debt Logging concessions

Page
GENDER SENSITIVITY Etc, atbp, ugubp,

• Women are marginalized

• Women are double/over-burdened
• Victims of all forms of violence
• Taken as sex objects

Your satisfaction,
our passion.

“God’s will for man is human dignity and a full and

abundant life for all.”
HUMAN DIGNITY
(THE THREE VIEWPOINTS)

1. The Religious/Christian Viewpoint

Genesis 1:26 “The human being is made in the image and likeness of God”
- as co-creator, he has to be productive; he has to protect nature and her natural
resources
- as co-redeemer (co-savior), he has to be responsible for his “brother/sister”
- as communitarian (co-social being) he has to live in harmony/synergy with others; he
needs and is needed by others

Genesis 1:28 The human being was intended to “have dominion over the earth.”
-having the right to property
-taking the responsibility for making the earth productive

God’s plan: The human being must develop self according to his/her dual nature:
8
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 - spiritual development: towards perfection, towards becoming more and more “the
image and likeness” of God.
- material development: to attain mastery over all created things and put them at the
service of God and fellow human beings; as the steward of all creation, he/she must
take the responsibility of protecting nature and its resources.

2. The Philosophical Point of View

The needs of the human being are not limited
to the physical or physiological.
He/she has a hierarchy of needs:

• communion with God

• synergy; communion with others
• self-actualization
• ego and esteem; self-worth
• social/love needs
• safety/security/certainty
• physiological: food, clothing, shelter, sex

➢ PERSON IS A RATIONAL BEING VASTLY SUPERIOR TO ALL OTHER CREATION BECAUSE

HE /SHE POSSESSES THE FACULTIES OF :

• intellect - the capacity to think and to understand and to form ideas.

• will – the capacity to direct his/her actions according to his/her
ideas.
• freedom – the moral ability to do as he/she should; to do what is
right, not what is wrong.

3. The Sociological Point of View

• The human being is a social being. It is in his/her nature to live with others, and
has therefore the responsibility:
9

- to help others. Instead he exploits others, or is being exploited

Page

- to share his life with others. Instead, he erects barriers, or is rejected

 - to achieve his highest aspirations and to fulfill his dreams and visions. Instead, he
is oppressed and exploited by others
The human being has the capacity and the capability to
develop, but his/her development is stunted because of poverty.
He is unable to develop skills which could obtain for him better
opportunities for a full and abundant life. He is unable to be
creative-he is too busy to earn a living he has forgotten how to
live. His will is weakened-he becomes lethargic and apathetic.
Poverty sometimes leaves the poor no choice.

The human being’s aspiration in life is . . .

To live a full and abundant life.

A life which can . . .

- Adequately satisfy the basic needs for

food, clothing and shelter
- Enable the person to meet the cost of
medicine and hospitalization
- Allow sufficient time for relaxation and
recreation
- Provide for education for self and
children
- Allow appreciation for the finer things
in life, e.g. books, art, etc.
- Provide for self and family with decent
housing
10
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 Your satisfaction,
our passion.

Everybody has the right to have access to the

means of production. When the existing system denies a
person that right while allowing a few others to enjoy a
life of abundance, luxury and abuse, then the system is
unjust, for the world was given to all not just to a few.
Ownership of property is not absolute, but has an
attached condition in that what is owned must be used
for the good of all.

When nature is destroyed (thru illegal/indiscriminate

destruction of the earth’s resources) for the sake of
profit, others are denied the use of these resources.

The Christian Concept of Property

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THE TYPES OF HELP AVAILABLE IN THE COMMUNITY
- Lending - Dole-outs
- Loans from usurers - “Bayanihan”
• Informal ways of help are seldom sustainable
• Formal institutions are organized
• Self-help is ego-centered
• Mutual self-help is others-centered. It is more humane and more Christian in
orientation. It is also more difficult because of certain barriers to cooperation.

OBSTACLES TO MUTUAL SELF-HELP

- Wrong attitudes, e.g. individualism and factionalism
- Racial memories of: Spanish extravagance, lavish spending; siesta time;
feudalism/paternalism; low self-worth (indios)
- The desire to get rich quickly or for instant results as in the case of projects being
undertaken without sufficient study.
- Communication problems
- Intra-personal and interpersonal conflicts
• The old approach was called IDAS
Idea
Decision
Action
Study

• The new, scientific approach is called ISDA

Idea
Study
Decide
Act
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 REMOVE THE BARRIERS:

The Cs of COOPERATION

Communication
Develop an atmosphere of openness and acceptance. This should
be a day to day, moment by moment effort by all concerned.

Coordination
With good planning and better communication, better
coordination.

Commitment building
Contrary to popular belief, commitment comes only after a lot of
dialogues and better understanding has been developed.

Conflict resolution
The absence of conflict is not a favorable sign; On the other hand,
too much conflict is destructive. Conflicts should be managed.

Competence development
Growth and development is faster if those given the responsibility
of leadership and management of the coop are competent people.
Competence can be developed through education and training.
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❖ A cooperative is member-owned- This means that the capital must
come from the members so that the spirit of belongingness will be
realized. The real essence of ownership is very visible.
❖ A cooperative is member- controlled/managed- This means that
generally members/owners will manage the business affairs of the
cooperative subject to rules and regulations set forth by the
cooperatives.
These rules and regulations should not be contrary to R.A. 6938 and RA.
6939, now RA 9520.
❖ A cooperative is a business enterprise- Cooperative must be
managed like a business enterprise so that it will ensure the
sustainability of its services and programs which are tailored fit to the
expressed common felt need of the members and the community.
❖ A cooperative is a member-patronized- A cooperative reason for
being is due to the fact that it was organized for its members and
therefore, members must patronize its services.
A cooperative which is not patronized by its members is not considered
a “genuine cooperative”.

❖ A cooperative must be community oriented- While it is true that

cooperative is for its members, however, concern for community must
also be considered by the cooperative like environment issues/concerns
and other community related welfare.

❖ A cooperative is a self-help organization- This means that

cooperatives is self-controlled as far as resource management, be it
human or material resources, is concerned. Decision making shall be
done by members and not to be dictated by an external group.

❖ A cooperative is not charitable organization- In the Philippines,

oftentimes, cooperatives are misconstrued to be charitable
organizations, which resulted to non-payment of members’ loan to the
cooperative.
14
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TYPES OF ORGANIZATIONS:
1. Pre-coops : organized as cooperatives, but not engaged in business
functions, e.g samahang nayons
2. Quasi-coops : other organization not registered as cooperative but observing
the cooperative principles and practices
3. Pseudo coops : using the name “coop”, but not adhering to the coop
philosophy, principles and practices, e.g. electric cooperatives
4. Full-fledged coops : duly registered, following the coop philosophy,
principles and practices

Nature of Real Cooperatives

“Cooperative” is derived from the latin CUM (together) and OPERARE
(work). It therefore means, “Working together for the common good.”

The coop is economic vehicle with social objectives.

C - Capitalized/Controlled by the member/owners

O - Owned by the members
O - Operated or managed by the member/owners
P - Patronized by the member/owners
S – Surplus for more Services to member/owners
CHARACTERISTICS OF COOPERATIVES
1. It is a group of people with common economic needs.
- people need to articulate their needs
- people need to differentiate between needs and wants
2. It is collective action.
- people need to learn how to work together in harmony/synergy
- people need to know why, what, when, how to act
3. It is a business/economic enterprise.
- people have to generate their own capital
- the business must be viable
- the enterprise must be big enough
- management capability and system must be developed
4. There is a special service relationship between the coop and the coop
enterprise.
- services must promote the members’ self-reliance
- the service must be timely relevant
- the service must address felt needs
15

- the service must be a adequate

Page

- the service must be accessible and affordable

 THE AIMS AND PURPOSES OF
COOPERATIVES
1. To promote thrift and savings
• Contributing one’s share capital is a means of
saving
2. To educate members, officers and staff
• A continuing education program is needed to
sustain membership support, leadership
development and staff competence.
3. To provide services to members
• the service must be based on common economic needs
4. To gain access to the means of production through collective action.

MINIMUM REQUIREMENTS FOR GROWTH

- the members must be willing to work together
- the cooperative helps members in their economic needs, but it is not a
charitable institution
- as a business, it makes money from its operations in order to sustain the
service; it must be run in a business-like manner
- its primary function is to serve the members, but the members must be
willing to pay for the cost of service.
- member-owner should be willing and able to contribute to the capital, in
cash or in kind
- members should be willing and able to
use the services of the coop
- there should be persons willing/able to
take the leadership
16 Page
TYPES OF COOPERATIVES
1. Credit Cooperatives:
To serve the credit needs of members
“Credit” is a word derived from the latin CREDO, which means beliefs,
trust
2. Consumes Cooperatives:
To serve the need of consumer goods
3. Producers Cooperatives:

To serve the common needs of producers

e.g. common pre/post harvest facilities

4. Marketing Cooperatives:
To do the marketing of produce in a joint and organized manner
5. Service Cooperatives:
To provide specific services for members
e.g. transportation, gasoline station, others
6. Workers Cooperatives:
This is a special type of coop, where the member-owners are also
employed by the cooperative
e.g. a furniture shop owned by the furniture workers themselves.
7. Multi-Purpose Cooperatives: A cooperative which attempts to provide all
of the above. In terms of operations and accounting systems, this type of a
cooperative is the most complicated.

HOW TO SAFEGUARD THE COOPERATIVE FUNDS:

- an adequate accounting and internal control system is installed
- persons handling cash are bonded
- the Audit and Inventory (AIC) or Supervisory Committee (SUPCOM) does
internal audit regularly
- sound and clear-cut policies are formulated by the Board Of Directors
- excess and reserve funds are deposited in the bank
- a continuing education for members is implemented
- an external audit is mandated by law
17

- the coop is duly registered; it can sue and be sued

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COOPERATIVE PHILOSOPHY
The philosophy of cooperatives embodies the ideals and aspirations of cooperators. It
encompasses these fundamental beliefs:

- That persons occupy a primary place in society, clothe as they are with human dignity
and freedom.
- That people have the God-given capacity to develop themselves and society, entitled
as they are to dignified and decent life.
- That we can actualize our potentials in a society where there is equality, justice,
democracy, freedom and peace.
- That communities should continuously work for these ideals, especially if actual
conditions negate them, in solidarity with other communities.

COOPERATIVE PRINCIPLES AND PRACTICES

COOPERATIVE PRINCIPLES are a system of ideas that determine the essentials

characteristics of cooperatives, and so, distinguish them from other forms of organizations or
enterprises. They are universal – i.e. not affected by time and space. Cooperative
organizations that do not follow these principles cannot be considered as real cooperatives,

COOPERATIVE PRACTICES, on the other hand, are the practical applications of these
principles as developed by the cooperators given country, in accordance with particular
conditions and circumstances. They may vary from one country to another, and from time to
time.

Historical Background:

The International Coop Alliance(ICA) cooperative principles were developed by the

following:

1. The Rochdale Pioneers: a group of 27 weavers from Toadslane, Rochdale, England who
organized a consumers’ cooperative, starting with the barest essentials,

2. The German Raiffeisen Banks (rural), organized through the efforts of Friedrich Wilhelm
Raiffeissen; this started as a bread union as a response to the poverty situation in the
community, and then evolved into a credit union.

3. The German Volks Banks (Peoples’ Banks) of Schultze – Delitz (urban) which developed
18

independently of the Raiffessen Banks

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 Statement on the
New Co-operative Identity
Definition
A cooperative is an autonomous association of persons united
voluntarily to meet their common economic, social and cultural needs
and aspirations through a jointly-owned and democratically
controlled enterprise.

Values
Cooperatives are based on the values of self-help, self-
responsibility, democracy, equity and solidarity. In the tradition of
their founders, co-operative members believe in the ethical values of
honesty, openness, social responsibility and caring for others.

Principles
The cooperative principles are guidelines by which cooperatives
put their values into practice.

1. VOLUNTARY AND OPEN MEMBERSHIP- Cooperatives are

voluntary organizations, open to all persons able to use their
services and willing to accept the responsibilities of
membership, without gender, social, racial, political or religious
discrimination.

Practices:
1. No compulsory membership
2. No discrimination against any person on account of religion race or
political belief.
3. No artificial limitation for admission of new members.
4 No artificial limitation of the right to withdraw from the membership.
5. Equal status of old and new members.

2. DEMOCRATIC MEMBER CONTROL- Cooperatives are

democratic organizations controlled by their members, who
actively participate in setting their policies and making
decisions. Men and women serving as elected representatives
are accountable to the membership. In primary cooperatives,
members have equal voting rights (one member, one vote), and
cooperatives at other levels are also organized in a democratic
manner.
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 Practices:

1. One person, one vote

2. No proxy voting
3. General assembly as supreme authority
4. Decision-making by the majority vote.
5. Direct or indirect participation of all members
in the control of the organization (i.e. through
the election of officers, board if directors, and
other committees.)
6. Control through regular audit

3.MEMBER ECONOMIC PARTICIPATION- Members contribute equitably

to, and democratically control, the capital of their cooperative. At least part of that
capital is usually the common property of the cooperatives. Members usually
receive limited compensation, if any, on capital subscribed as a condition of
membership. Members allocate surpluses for any of the following purposes:
developing their cooperative, possibly by setting up reserves, part of which at
least would be indivisible; benefitting members in proportion to their transactions
with the cooperative; and supporting other activities approved by the
memberships.
Practices:

1. Limited interest/dividend on share capital.

2. Equality of treatment regardless of one’s capital contribution.
3. Limitation of individual share contribution to not more than 20% of total
capital.
4. Provision of reserve funds out of the operation of the
5. Provision of reserves for the cooperative, belong to the development of the
cooperative members and should be business and common services
distributed in such a manner as
6. Patronage refunds would avoid one member gaining at the expense of others.

4 . AUTONOMY AND INDEPENDENCE –

Cooperatives are autonomous, self-
help organization controlled by their members. If they enter into agreements with
other organizations, including governments, or raise capital from external
sources, they do so on terms that ensure democratic control by their members
and maintain their cooperative autonomy.

Practices:

1. Self-reliance
2. BOD/GA as policy-making body
3. Minimal government assistance
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5.EDUCATION, TRAINING AND INFORMATION – Cooperatives provide
education and training for their members, elected representatives, managers and employees, so
they can contribute effectively to the development of the cooperatives. They inform the general
public – particularly young people and also leaders – about the nature and benefits of co-
operation.

The strength of the cooperative as self-help organization depends to a large extent on the
active participation of members. It is through continuing cooperative education that members
understand the organization, their duties, responsibilities and potentials.

Practice:

1. Appointment of an Education Committee.

2. Provision of an Education Fund out of net income.
3. Requirement of pre-membership education before
admission.
4. Ownership or membership meetings.
5. Continuing education/training of officers and staff
6. Adoption of an education and training plan.

6.CO-OPERATION AMONG COOPERATIVES –

Cooperatives serve their
members most effectively and strengthen the cooperatives movement by working
together trough local, national, regional and international structures.

All cooperatives organization in order to best serve the interests of their

members and their communities should actively cooperate in every practical way
with other cooperative at the local, national, and international levels, having as
their aim the achievement of unity of action by cooperators through out the
world. We belong to a movement.

Practices:

1. Membership in secondary and tertiary organizations.

2. Participation in projects like central fund, inter-coop trade, etc.

Note: The principles enumerated above are based on the experience of the
cooperative pioneers in Rochdale, England, and the Raiffeissen and Volksbank of
Germany. These were consolidated as agreed upon by the International
Cooperative Alliance (ICA), the international umbrella organization of
cooperatives through out the world.

7. CONCERN FOR COMMUNITY –

Cooperatives work for sustainable
development of their communities through policies approved by their members.

Practices:

1. Collaboration with various GOs/NGOs

2. Programs/services for members’ households/communities
3. Concern for community-based activities/initiatives
4. Issues advocacy
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 FILIPINO COOPERATIVE VALUES

1. Cooperative as social enterprises shall dedicate themselves to ideals

committed to the development of people and the conservation of
resources for sustainable development.
2. Cooperatives shall be organized based on felt needs and their
development anchored on the efficient utilization of private and
communal resources.
3. Cooperatives shall serve as stewards of natural resources both land and
marine-based to maintain ecological balance.
4. Cooperative members as social entrepreneurs shall promote and
practice social accountability.
5. Cooperatives shall promote unifying Filipino values which will enhance
active members’ participation.
6. Cooperatives shall share common symbols that will give members’
identity, enhance their dignity and self-respect and deepen their social
commitment.
7. Cooperatives shall pursue goals and make decisions based on
complementation and consensus to foster harmonious relationship
among members.
8. Cooperatives recognize the interdependence of the various sectors of
society. Thus, they shall endeavor to resolve conflicts – social, political,
economic and cultural – in a non-adversarial and non-confrontational
manner.
9. Cooperatives shall take an active leadership role in the community
which shall promote unity, peace and stability.
10.Cooperatives shall work towards the attainment of genuine social
justice and economic nationalism.
22
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 The Cooperative Structure

BOD Area of responsibility

Directional
General Assembly (GA)

Audit Board of Election

Committee Directors Committee
(BOD)

Secretary

Treasurer

Mediation and Ethics Other

Education
conciliation Committee Committee
Committee
Committee

Manager‘s Area
Manager Operational

Management Staff

Contents of the Cooperative By-Laws

• General Concepts and Principles
• Organization and Registration
• Membership
• Administration
• Responsibilities, Rights and Privileges
• Insolvency of Cooperatives
• Dissolution of Cooperatives
23

• Capital, Property and Funds

•
Page

Audit, Inquiry and Member’s Right to Examine

• Allocation and Distribution of Net Surplus
Historical Development of Cooperative Regulation in the Philippines

1915 – Act. No. 2508, otherwise known as the “Rural Credit Cooperative Law,”, tasked
the Bureau of Agriculture with the promotion and organization of rural credit
cooperatives.

1927 – Act. No. 3425, known as the Cooperative Marketing Law, placed the
responsibility of organizing farmers into marketing coops to another government office,
the Bureau of Commerce and Industry.

1940 – Commonwealth Act No. 565, otherwise known as the “Cooperative Law,”
created the National Trading Corporation (NTC) to which the tasks of organizing and
supervising cooperatives of the Agriculture and Commerce Bureaus were transferred.
The law also provided for the establishment of the National Cooperative Fund and
expanded government recognition and support to all types of cooperative.

1949-Executive Order No. 93 converted the NTC into the National Cooperative and
Small Business Corporation (NCSBC)

1950-Executive Order No. 364 abolished NCSBC and created the Cooperative
Authority Office (CAO) under the Department of Commerce and Industry.

1952-Republic Act No. 821 created the Agricultural Credit and Cooperative Financing
Administration (ACCFA) to organize, supervise and finance agriculture cooperatives,
specifically the Farmers Cooperative Marketing Associations (FACOMAs).

1963-Republic Act No. 3844, known as the Agricultural Land Reform Code ,
reorganized ACCFA into the Agricultural Credit Administration (ACA) tasked with
financing supervision and regulation of agricultural cooperatives. Promotion and
organization of coops were vested on another office, the newly created Agricultural
Productivity Commission (APC).

1971-Republic Act No. 6389 provided for the attachment of ACA to the Department of
Agrarian Reform to support the credit financing of the Agriculture Land Reform
Program.
1973-P.D. 175, entitled “Strengthening the Cooperative Movement”, and LOI No. 23
repealed all previous laws on cooperatives and tasked the Bureau of Cooperatives
Development (BCOD) under the Ministry of Local Government and Community
Development (MLGCD) the responsibility of implementing the decree.
1980-Executive Order No. 595 transferred the BCOD from the MLGCD to the Ministry
of Agriculture and Food (MAF).
1986-Executive Order No. 116 converted the Bureau of Cooperatives Development
(BCOD) to Bureau of Agricultural Cooperatives Development (BACOD)
24

1990-Republic Act No. 6939 created the Cooperatives Development Authority (CDA)
Page
HOW TO MANAGE A COOPERA TIVE?

The General Assembly-is the highest policy-making body of the cooperative

and shall exercise such powers as are stated in R.A. 6938, in the Articles of
Cooperation and in the By-laws of the Cooperative.

The conduct and management of the affairs of the cooperative shall be vested
in a Board of Directors, who are volunteer leaders. As a body, it shall direct and
supervise the business, manage the property of the cooperative.

The day-to-day operation shall be under the responsibility of a manager, who

shall be directly responsible to the BOD. All management staff shall be directly
responsible to the Manager.

The co-op shall be managed in a business-like manner with the following eight
(8) components:

1. Membership 5. Programs and Services

2. Leadership 6. Policies and Guidelines
3. Management Staff 7. System and Procedures
4. Resources 8. Support System

Meetings to review/evaluate operation:

1. General Assembly
a) Regular Assembly-once a year within 90 days after December31
b) Special Assembly- As the need arises
▪ Quorum – per by-laws but not less than 25% of the members who
are entitled to vote.

2. Board of Directors
a) Regular= Monthly
b) Special = As the need arises

3. Others (Management Staff, Committees)

1. At least once a month
▪ Quorum- 50% +1
25
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 THE EIGHT COMPONENTS
OF A CO-OPERATIVE
1. OWNERSHIP/MEMBERSHIP
➢ Growth and expansion
➢ Support and participation
• Regular share capital contribution
• Savings deposit in coop
• Patronage of services
• Payment of loans, service fees and
other services
• Attendance in ownership meetings
• Attendance in general assemblies
• Participation in other coop activities

2. LEADERSHIP
➢ Knowledgeable, skilled, capable and functional officers
-performance of tasks and functions by:
• Board of Directors
• Credit Committee
• Audit and Inventory Committee
• Election committee
• Education Committee
• Secretary
• Treasurer
-with well-defined plan
➢ Committed, dedicated and willing to serve
➢ visionary

3. MANAGEMENT
➢ With well-defined organizational structure
➢ Knowledgeable, competent and capable
➢ Efficient performance of job
• With clear job description
• Performance of staff evaluated regularly
• Fair compensation and staff benefits
• Timely submission of reports
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➢ With staff development program

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➢ Honest, committed and hardworking

4. FINANCIAL
➢ Adequate internal resources
• Continuous capital build-up (CBU),
varied CBU schemes
• Increase in share capital
• Increase in savings deposits
➢ Not dependent on external borrowings
➢ Not dependent on grants and donations

5. PROGRAMS AND SERVICES

➢ Expansion and variety of services

➢ Maximized resources
• Increase in business volume
➢ Reasonable return of investments
➢ Accessibility and affordability
➢ Relevant and felt needs of members
➢ Social advocacy and community service

6. SYSTEMS AND PROCEDURES

➢ Accounting and internal control system per service in-place
and implemented
➢ Practical, updated and user friendly
➢ Regular internal audit
➢ Proper segregation of functions
➢ Timely submission of financial report
➢ Management information system in-place and implemented

7. POLICIES
➢ Comprehensive and properly classified policies based on
the 8 coop components
➢ Manualized policies
➢ Disseminated to members
➢ Strict implementation of policies
➢ Policies reviewed and updated at least annually

8. SUPORT SYSTEMS
➢ Operational education program for owners, officers, staff and the
community
➢
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Yearly external audit

➢ Adoption of yearly development plan and budget
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➢ Linkaging and networking

➢ Improvement of coop facilities (lot, building, equipment, etc.)
➢ Vision, mission and goal statements published
 Cooperative Development Authority

The Cooperative Development Authority (CDA) is the only

government agency empowered to register all types of cooperatives.

Its main office is located in Metro Manila. Regional and provincial

offices in key areas of the country are being set up to facilitate the flow of
its services.

The CDA was created by R.A. 6938 to “…promote the viability and
growth of cooperatives as instruments of equity, social justice, and
economic development and to create an agency in fulfillment of the
mandate in Section 15, Article XII of the Philippine Constitution…”

CDA Requirements for Registration

The following are to be submitted in four (4) copies:

1. Economic Survey
2. By-Laws*
3. Articles of Cooperation*
4. Certificate of Non-Relationships*
5. Certificate of Bank Deposit*
6. Certificate of Membership Education
7. Minutes of 1st Organizational Meeting
8. Treasurer’s Bond*
9. Location Map
10. Organizational Structure
11. Registration fee of one-tenth (1/10) of the one percent (1%)
of the paid-up capital
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 Education is the Lifeblood
of Cooperatives

Experience shows us that the main cause of cooperative failure is the

lack of continuous cooperative education. In our general observation,
cooperatives which have no education program for its members, officers and
staff became stagnant or they just die a natural death.

Many cooperatives were able to acquire large assets over a short period
of time through external borrowings but after the funds have been
apportioned to the members as loans, the cooperative begins to crumble.
There is high delinquency rate. Many cooperatives suffer from this. This is
because the growth in cooperatives’ assets or properties is not proportional to
the growth in management capability. And how can management capability
grow if there is no continuous education program implemented by the coop.

Look at the Samahang Nayons that were organized in the early 1970’s.
Only about 5% of them are surviving at present. Why is this so?

During the early stages in the promotion of Samahang Nayons (Barrio

Associations), organizers were so enthusiastic in conducting Pre-membership
Education Seminars that almost all barangays were able to have their own
Samahang Nayons. This was being mandated by PD 175 and LOI 23. The
government has set the criteria on how and when to promote Samahang
Nayons into full-fledged Kilusang Bayan (Cooperatives). But how many
subsequent trainings and seminars have been conducted to upgrade the
knowledge, skills and attitudes of the members, officers and staff?

Then , there was the EDSA Revolution, Power changed hands, Republic
Act No. 6938, otherwise known as Cooperative Code of the Philippines was
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born. Organizing of cooperatives mushroomed throughout the Philippines.

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 What is said is not yet heard

What is heard is not yet understood

What is understood is not yet accepted

What is accepted is not yet applied

What is applied is not yet continually

practiced

What is continually practiced is not yet

internalized
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Social Context of Education

1. Social Analysis

2. Concept of Transformation

3. Conscientization

4. Human Relations
(trust building/communication)

5. Organizational
Development for
Community Action
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prepared by: rudzmvillanueva 2021april