COOPERATIVES exist to meet the economic, social, and cultural needs of people through collective ownership and democratic control. They are formed when individuals realize that acting together is more effective and fair than acting alone. Cooperatives help members obtain goods, services, credit, or market access at reasonable cost. By pooling resources, members reduce costs, increase bargaining power, and protect themselves from exploitation by middlemen or monopolies. Individual members are often too weak economically to operate efficiently on their own.
The cooperative model is based on self-help rather than profit maximization. Members support one another to improve their livelihoods collectively. Cooperation strengthens people economically and socially without dependence on external capital owners. Cooperatives are owned and managed by members on the principle of one member, one vote, unlike companies where control depends on capital. This ensures equality, participation, transparency, and accountability.
Cooperatives promote inclusion of weaker sections of society such as small farmers, workers, artisans, and consumers. They help reduce inequality and support community development. Economic development should benefit people, not just capital. Unlike private enterprises, cooperatives exist primarily to serve members, not to maximize profit. Any surplus is shared fairly or reinvested for member benefit. Service-oriented enterprises are more sustainable and socially responsible.
Cooperatives emphasize education, training, cooperation, honesty, and social responsibility. Cooperatives exist to combine economic efficiency with social justice and democratic values, making them a people-centered form of organization.
RA 9520 is the law that amended Republic Act No. 6938 (the Cooperative Code of the Philippines). It was enacted to strengthen, modernize, and professionalize cooperatives in the Philippines. RA 9520 was passed to: strengthen the cooperative movement, improve governance, accountability, and transparency, make cooperatives more responsive to economic and social development, and align cooperatives with international cooperative principles.
One of the salient features of the cooperative is the Cooperative Education and Training Fund (CETF) is a mandatory fund required under Republic Act No. 9520 (Philippine Cooperative Code of 2008). Its main purpose is to support the continuous education, training, and capacity-building of cooperative members, officers, and employees. CETF exists to: educate members on cooperative principles; values, and laws, train officers and employees in governance, management, and finance; develop leadership and professional competence; ensure cooperatives are well-managed, transparent, and sustainable.
At least 10% of the net surplus of a cooperative is allocated to CETF. Part of this fund may be remitted to: federations and unions, and CDA-accredited training institutions, as required by law.
