Autonomy and Independence

Cooperative businesses worldwide are guided by the Seven Cooperative Principles, adopted and adapted since 1895 by the International Cooperative Alliance. Abiding by the principles helps cooperatives adhere to the values that bind cooperative businesses everywhere.

The universal definition of 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.”

The universal values by which cooperatives operate are based on “self-help, self-responsibility, democracy, equality, equity, and solidarity. In the tradition of their founders, cooperative members believe in the ethical values of honesty, openness, social responsibility, and caring for others.”

These are noble ideals, but they are not difficult to understand, nor are they difficult to follow. All of the 26 member-owned electric cooperatives in North Carolina understand and follow these ideals. Working for their membership reminds employees of these ideals every day. Cooperatives are in business just like any other enterprise, but they don’t conduct business “as usual.” They operate solely for the benefit of their members and their members’ communities. Their primary aim is not to earn a profit for shareholders or anyone else, but instead to maintain the business in a sound manner, to perform the best possible services safely and at a reasonable cost, to contribute to the stability of their communities, and to return any “profits” or margins to their members in proportion to their participation or patronage.

Cooperative Principle No. 4:
Autonomy and Independence

“Cooperatives are autonomous, self-help organizations 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.”

As businesses, the nation’s electric cooperatives — and there are more than 900 of them — operate independently, controlled by their membership and not by government, parent businesses or any other institution or agency. As the principle states, they may enter into business agreements — such as agreements for purchasing wholesale power, or obtaining loans from their own national financing cooperatives or the federal Rural Utilities Service — but such agreements do not compromise members’ ownership or a cooperative’s autonomy.

An example of your cooperative’s independence includes the annual election of boards of directors. Each member-owner of a co-op annually may cast a ballot for board candidates, who themselves are members of the co-op. The democratically elected board is accountable to the membership for managing the business fairly and carefully. The cooperative does not depend on any other entity to choose who manages the business.

Likewise, the business of the electric cooperatives in North Carolina is not regulated by government in the way other utilities are. While they are subject to federal, state and local laws like any other business — and are subject to review by the state agency North Carolina Rural Electrification Authority — North Carolina’s cooperatives regulate themselves by their own democratic processes. In short, cooperatives are responsible for themselves and answerable to themselves.