Cooperative Governance; Where do you stand?

Over the past 6 months there has been a common theme to questions, and it boils down to one word, participation. How can we get people involved, how can we get people to engage, how do we get others to join? This isn’t only in the cooperative world but in all organizations; personal and professional.
Participation is defined as “to take part in” or “to have a part or share in something”. For cooperatives, participation is a large part of being a member. Either an expectation of using the services of the cooperative, utilizing the resources that accompany the cooperative or reaching a certain quota or goods sold to the cooperatives. All these are dependent on the cooperative by the structure of their bylaws and policies.

Graphic of light colored light bulb and hands connecting colored puzzle pieces
Cooperatives are as unique as people, one cooperative is not the same as another, or the saying of “If you’ve seen one co-op, you’ve seen one co-op.” This holds true for cooperative board of directors. Participating in a cooperative as an individual is difference as representing your cooperative as a director. Directors are elected by the members of the cooperative to represent them, to uphold the cooperative mission and values set forth and to keep the cooperative members informed.

Cooperative board directors have several duties and responsibilities that members have entrusted them with such as the welfare of the co-op, hiring and evaluation the management of the cooperative, setting goals for the cooperative and overseeing the financial health of the cooperative. They aren’t the individual that is in the daily operation role of the cooperative. That responsibility goes to the general manager of the cooperative, the person the board of directors entrusted to run the daily operations. While cooperative board of directors can look similar to those from 20 or 30 years ago, today’s boards need to have a more active role in the cooperative to ensure the longevity of the cooperative is successful and effective.

As stated on the University of Wisconsin, Center for Cooperatives website, the Center released their findings from the Cooperative Governance Research Initiative (CGRI) that was conducted in 2021. As stated in the CGRI report, “Democratic member control is cooperatives’ superpower and Achilles heel. Decades of research has found that strong governance is essential for cooperatives to thrive. Yet cooperatives have lacked the robust data that is needed to benchmark, reflect upon, and improve their governance practices.” The reason for the research was to help understand and improve cooperative governance so cooperative members, directors, developers and interested parties had knowledge to compare to. Those that participate in the survey were from all across the cooperative sector. The Centers website states that the “results of the survey show that one-third of board members tenure of serving on the board is 10 years or more, whereas 36% have 3-9 years’ experience and 34% have less than 3 years. While two-thirds of board members are serving less than 9 years, efficient and effective boards need to always have a plan for succession and ways to recruit new board members.”

Multiple blue gears with various business related graphics inside, such as a light bulb, people, and target.
Part of being a board director is to recognize the need for board trainings, and educational development for not only members but the directors themselves. USDA released in 2002, the ‘Circle of Responsibilities for Co-op Boards‘ and are as follows; 1. Represent members 2. Establish cooperative policies 3. Hire and supervise management 4. Oversee acquisition and preservation of cooperative assets 5. Preserve the cooperative character of the organization 6. Assess the cooperative’s performance 7. Inform members.

As a cooperative director, how do you stack up against the circles of responsibility? As a cooperative member, how can you get involved or engaged? Educational trainings are offered by various organizations and in multiple formats that make is more accessible to attend while maintaining a busy professional or personal workload.

Could Cooperation Help Your Small Business Market Better?

Product, price, place, and promotion. One of the keys to success for a small business is mastering marketing. Whether entrepreneurs are advertising their business, using promotional strategies to reach their target customers, or working to place their products into a new market channel, marketing encompasses many aspects of business. Are cooperative approaches to marketing opportunities a fit for your small business to save time and resources?

Does your business use supplies that many other businesses also use?

Purchasing supplies as a group, via a purchasing cooperative, for example, may help businesses lower per unit costs for supplies, improve market information across the supply chain, consolidate transactions to reduce administrative burdens, reduce inventories, coordinate shipping, or even control quality attributes.[1] For example, restaurants may use a purchasing cooperative to purchase food, packaging, equipment, and other commonly needed supplies together in bulk. The Wendy’s Quality Supply Chain Co-op works with suppliers to provide member restaurants with products and services, pooling billions of dollars in buying power.

For a more detailed look at the purchasing cooperative model, see the publication “A Guide for the Development of Purchasing Cooperatives,” by the U.S. Department of Agriculture.

Golden french fries in white paper container. White toilet tissue rolls in a wire shopping cart. Yellow paper shopping bags with polka dots and stars.

Could your business advertise with businesses in the same industry or geography?

Marketing cooperatives and similar approaches may offer opportunities for small businesses to reach new market channels or audiences while reducing costs and administrative burden for individual businesses.

In Ohio, businesses in the tourism industry like convention and visitors bureaus, lodging, restaurants, attractions, festivals, and others, may be able to utilize TourismOhio’s “Ohio, The Heart of It All Co-op Advertising Program,” which provides members opportunities to purchase advertising like paid social, digital, and paid search, as well as opportunities for marketing contact creation offerings like photography, videography, storytelling, and influencer engagements, among other potential benefits.

Illustrated image of computer screen with various graphics, including play symbol, money symbol, text bubble, light bulb, and megaphone.

Does your business have the ability or opportunity to share physical space with other businesses?

In some instances, cooperative approaches to helping businesses access the physical space they need to operate or market their business might offer benefits. For example, shared-use space like business incubators or artist cooperatives might help create affordable opportunities for start-up businesses, help businesses attract new customers in spaces where customers who enter the space to shop at one business may also be encouraged to shop at others, and reduce administrative burdens by sharing maintenance and upkeep for the space and outdoor areas.

Learn more about artist cooperatives in this “Toolkits for the Arts: Toolkit 2: Form an Artist Cooperative” from the Tamarack Foundation for the Arts in West Virginia.

Open sign on inside of glass window.

Some Considerations for Working Cooperatively

Small businesses exploring how a collaborative approach might help them better market their products and businesses will need to consider various key questions. The questions below are a starting point but are by no means exhaustive. Entrepreneurs who are interested in exploring a cooperative approach further can reach out to the College of Food, Agricultural, and Environmental Sciences Center for Cooperatives at Ohio State.

  • Who will be engaged? What is their role?
  • How will the group make decisions?
  • How will the group be formally organized?
  • How can the group manage risk?
  • Will working together provide the intended benefit

Graphic of light colored light bulb and hands connecting colored puzzle pieces

Contact Us!

For more information about the CFAES Center for Cooperatives at The Ohio State University visit go.osu.edu/cooperatives. Contact the CFAES Center for Cooperatives at osucooperatives@osu.edu or 614-247-9705.

For assistance with registration or additional questions about events, please contact Samantha Black at black.1156@osu.edu or 614-247-9774.

CFAES provides research and related educational programs to clientele on a nondiscriminatory basis. For more information, visit cfaesdiversity.osu.edu. For an accessible format of this publication, visit cfaes.osu.edu/accessibility.

[1] Reynolds, B. & Wadsworth, J. (2009). “A Guide for the Development of Purchasing Cooperatives,” U.S. Department of Agriculture Rural Development, Cooperative Information Report 64.

Youth Cooperative Leadership Experience Day Held at OSU South Centers

The OSU Center for Cooperatives team hosted 34 FFA students from Peebles High School and Ohio Valley Career Technical Center on Friday, March 31, 2023, for the Youth Cooperative Leadership Experience Day held at OSU South Centers.  The Youth Cooperative Leadership Experience is an educational program that provides high school students in the Appalachian region an opportunity to learn about the cooperative business model and careers in agricultural, while developing leadership skills.

The event kicked off with a welcome from OSU South Centers Director, Dr. Tom Worley, who provided students with details about the uniqueness of South Centers and the opportunities it brings to the southern Ohio region, as well as numerous jobs.  Dr. Worley described the many career paths available at the Center, from agricultural, research, and business development just to name a few.

Students began the day with a wagon tour of the farm, where they were able to view strawberries growing in the high tunnel, see how hops are grown, and hear how research is conducted with small fruits.  They were then given a tour and in-depth look at the hatchery, where they were able to learn about how to raise and care for various types of fish and view the Center’s famous sturgeon.

Students then had the opportunity to experience hands-on lab demonstrations of soil testing, with Dr. Rafiq Islam and Dr. Arif Rahman, part of South Centers Soil, Water and Bioenergy Resources team.  They were shown how to field test the soil to estimate quality, active carbons, and nitrogen fertilization, as well as recognizing what the coloration of the soil means.  All students were provided soil test kits they could take home to do their own soil testing.

Small fruits are also a key point of research at South Centers and Dr. Gary Gao and Dr. Dan Remley demonstrated many ways strawberries and oranges provide key sources of information.  Students were taught how to measure natural and artificial sugar levels using fresh oranges and orange juice, as well as how to extract DNA from strawberries.  Caydence from Peebles said, “The Strawberry DNA and the color machine activity was very interesting to me, in our group we looked at the color of the strawberry compared to the sugar content of each; the darker the strawberry the higher the sugar content, which makes sense that there is more sugar as the strawberry ripens.”

Microgreens was another fun lab activity students enjoyed, and was taught by Research Assistant, Ryan Slaughter.  Microgreens are becoming a very popular, healthy, easy, and enjoyable way to grow delicious greens from virtually anywhere in a very small area or limited amount of space.  The greens can be grown in small plastic containers, similar to restaurant takeout containers, and placed in a window.  Students were provided, potting soil mix, the opportunity to select from lettuce or kale seeds and were then able to plant their seeds with information about providing care and the growth of their microgreens.

A very popular point of interest for the day was visiting the aquaponics lab.  Research Associate, Thom Harker, gave students a first-hand account of what running an aquaponics system looks like, and provided detailed information about care of the fish and their importance in the growth process for the crops.  Both students and teachers were very interested in receiving information on how they can develop their own aquaponics systems at their schools.

During lunch, students had the opportunity to hear from several cooperative business leaders as they provided details about their cooperative, job opportunities available and the education and/or skills set needed to perform those jobs.  Companies represented were South Central Power, Farm Credit Mid-America, Atomic Credit Union, Adams Rural Electric Cooperative, and Dairy Farmers of America. Following lunch, students were able to engage one-on-one with each of the business leaders while visiting their tables during the Co-op Career Fair.  Company representatives not only offered students information and potential job opportunities, but offered help with resume building and even offered a mock interview to one lucky student.

Students also had the opportunity to speak to a representative from Ohio State University Agricultural Technical Institute from Wooster, OH, who painted a picture of ag campus life for students possibly interested in pursuing a degree in agricultural sciences.  There are a number of programs available across all animal species in ag business, marketing, engineering and many others.

Peebles High School ag teacher, Becky Minton, had this to say about the day, “the YCLE event was wonderful!! My students not only had the opportunity to tour the research facilities and hear about the research that is currently happening at OSU South Centers but received a hands-on learning opportunity as well.  Students participated in Strawberry DNA extraction, color & sugar testing of fruits, understanding soil testing, aquaponics and the importance of proper water quality testing for both fish and plants, and growing their own fodder/microgreens system. Students were able to discuss the importance of Co-ops with industry representatives but also engage in one-on-one conversations with them; my students were able to see local opportunities for job placement in the area of cooperatives. The lunch that was provided was a great addition to the day! I could not have asked for a better day with my students to learn and have fun at the same time; it was truly an enjoyable experience for me as a teacher and for them as students.”

Exploring the Ways Cooperatives Support Sustainable Development at the 2023 Appalachia Studies Conference

The 46th Annual Appalachian Studies Conference, hosted on the Athens, Ohio, campus of Ohio University in the heart of the Buckeye state’s Appalachian region, celebrated the region’s resilience. From scholarly presentations to practitioner panels, arts performances, poster presentations, and more, the conference explored issues like diversity, equity, and inclusion, environmental challenges and reclamation, combating food deserts, honoring and sharing the region’s history, traditions, and culture, and much more via the theme “AppalachiaFest: From Surviving the Thriving.”

Picture of "AppalachiaFest: From Surviving to Thriving" button on green background with black font "Visit Athens County, Ohio."

The theme of the 2023 Appalachian Studies Conference was “AppalachiaFest: From Surviving the Thriving.”

Hannah Scott, CFAES Center for Cooperatives Program Director, joined a panel with colleagues from Pennsylvania and Kentucky around the theme, “Cooperatives and Sustainable Development in Appalachia.”

Dr. J. Todd Nesbitt, Professor of Geography at Lock Haven University of Pennsylvania studies economic geography, including the history of economic development in Appalachia. Defining sustainable development simply as “growth that must be accomplished with respect for nature and humankind,” Dr. Nesbitt posited that “most cooperative enterprises achieve sustainable development by default,” through their commitment to globally recognized principles including democratic member control and concern for community, as well as values of self-help, democracy, and equity.

In 2020, Hannah Scott explored how sustainability is a part of being a cooperative in this article.

From farmers marketing their products to consumers accessing new or affordable goods and services to workers democratically owning their workplace, Hannah Scott shared how the cooperative model is being applied across Appalachia and how the CFAES Center for Cooperatives’ Appalachia Cooperates Initiative (ACI) is working to support a cooperative ecosystem in the region. ACI is a peer learning network. The main idea is to connect cooperative, community, business, and economic developers and advocates in Central Appalachia. By helping build these connections and providing learning opportunities, the CFAES Center for Cooperatives’ goals are to build awareness and understanding of the co-op model, equip practitioners with knowledge and skills, and facilitate a connected network of co-op and community developers. ACI was born out of a collaborative dialogue between partners in Ohio, West Virginia, and Pennsylvania.

The Center regularly hosts peer networking calls and learning sessions as part of the ACI. Find learning session recordings and sign-up to receive emails about the Appalachia Cooperates Initiative at: go.osu.edu/appalachiacooperates.

A slide sharing the goals of the Appalachia Cooperates Initiative: Develop practitioners’ awareness and understanding of the cooperative model and of cooperative development resources to better recognize and act on cooperative opportunities in their communities Foster relationships among practitioners that will facilitate joint cooperative development activities in Central Appalachia and allow practitioners to better utilize existing resources Raise awareness of the cooperative business model as an opportunity for economic development and justice in the region.

The goals of the Center’s Appalachia Cooperates Initiative include developing practitioners’ awareness, fostering relationships, and raising awareness about cooperatives as an economic development opportunity.

Myrisa Christy, Project & Development Specialist with the Kentucky Center for Agriculture and Rural Development (KCARD) shared how KCARD’s team, along with partners like Kentucky Farm Bureau and others, were part of an effort to activate networks of cooperative farm supply stores to support post-tornado recovery in 2022. With financial support from community partners, cooperatively owned farm supply stores were able to pivot to help community members procure needed supplies like fencing and small equipment to recover from devastating tornadoes in the state. Christy also shared multiple examples of cooperative or cooperative-like efforts to respond to community needs in Appalachia, highlighting that cooperatives are focused on serving members’ needs in a way that builds equity and provides members with control over the enterprise, but recognizing that there are various barriers to cooperative development in the Appalachian region.

For more information about the Appalachia Studies Association (ASA), visit: https://www.appalachianstudies.org/.

National Council of Farmer Cooperatives Annual Meeting 2023

The 2023 National Council of Farmer Cooperatives was recently held in Orlando, Florida from February 8th– February 10th.  This year’s theme was “Strategy and Action: Thriving in a Disruptive Ag Landscape.” The event kicked off with opening remarks from Chuck Connor, President and CEO of National Council of Farmers, Jon Doggett, former CEO National Corn Growers Association, and Hunt Shipman, Principal and Director for Cornerstone Government Affairs.

Keeping with the theme, the group began the discussion with addressing a hot button issue— ‘How do we deal going forward?’ meaning how do we take the various disruptions from the past three years we’ve faced and are continuing to face and plunge forward.  “We have an obligation to turn people’s views around and get back to the times of being able to share the bread,” explained Jon Doggett.  “The political changes are going to come from elected officials in the primary races, and we need to start understanding that.”

The USDA has reported rural America is drastically shrinking, with much fewer farmers in their representative districts.  For example, in the state of Iowa in the 1960’s there were 6 representatives for the state, now there are only 4.  In order to stay relevant today, we must start by telling America what we’re doing for them! Mr. Shipman asked the audience if it’s really enough for America that at the end of the day everyone’s got to eat?  Knowing this is something we worry and think about is not enough to drive a vote, we must continue the dialogue and keep it in the minds of the people for a lengthy period of time.

A very valuable point was articulated by Mr. Doggett, “We can’t educate consumers, we market to them, so what are we doing for them? We must provide the information they’re looking for, as well as advice to navigate co-ops in farming.  We must quit thinking of labeling and bring in new people and perspectives, embracing where we are today.”

The panel concluded their session opener with the importance of making connections and understanding your audience, validating those connections to meet people where they’re at.  Shipman left the group with a very proactive thought, “Don’t try and fit in just to check a box, deal with the core issues that are coming at us, remain engaged at the highest levels and really get involved.”

This is very fitting for each of us.  There will also be a place to get involved and engaged to be proactive.  Let’s take the opportunity to reach out to our friends, neighbors, and colleagues to thrive in disruption.

3rd Biennial Ohio Co-op Law Conference a Success

During the month of January, attorneys, co-op developers and co-op minded individuals gathered in Columbus for the 3rd Biennial Ohio Co-op Law Conference. This two day event held a wide variety of co-op law related sessions with topics ranging from employment law and worker co-ops to experts speaking on housing cooperatives with nearly 40 in attendance.

Keynote speaker, Doug O’Brien, President and CEO of NCBA CLUSA, spoke to attendees on ‘Cooperatives for the Modern Era’. Doug touched on the current role that cooperatives have in todays society and how cooperatives could be more relevant in the future with the economy. All which addressing how getting involved can help bring more awareness to cooperatives, whether it be at a state, local or federal level working on policy or working one on one with cooperative groups to bring awareness and education.

On day two, Nathan Schneider, Professor of Media, Communication and Information at University of Colorado Boulder spoke on the future of cooperatives and the 21st century. Nathan discussed how individuals need to be an advocate for cooperatives and to be aware of the gaps that we see in society.

Professor Ariana Levinson, University of Louisville,  spoke on the topic of worker co-ops and employment law discussing the legal structure that can distinguish the worker owners from the employees and breaking down some of the legal structure that is in place for classification. While panelists’ spoke on how the legal community has helped navigate and support the development of cooperatives around the area.

Those in attendance were able to engage with one another throughout the event networking and bringing relative issues to the forefront to be discussed. Coming from across the country, representatives from Texas, Connecticut, Wisconsin and Tennessee gathered together to learn more on defining the cooperative legal structure and how to guide cooperatives with resources.

With plans to meet again in 2025, organizers are already meeting to create another engaging conference. Stay tuned and hope to see you at the next conference!

Wait, Who Owns that Photo? A Basic Intro to Copyright for Small Business Marketing

As the calendar turns to a new year, it is a natural time for entrepreneurs to consider how they want to improve and to plan for the coming month, quarter, and even year. It is also a great time to review past marketing strategies and plan for the coming year. Have you thought about how you can improve your business’s marketing in the new year? Here are some thoughts to consider.

Marketing and Legal Considerations: Intellectual Property

Whether a business is thinking about entering a new market channel, wants to reach a different target customer group, is planning to refresh its website, or thinks a new social media platform would be useful, business marketing and branding can include legal considerations, including factors like content ownership and the use, protection, and monitoring of intellectual property like trademarks and copyright, among various other areas.[1]

As they market themselves and their products, businesses may create intellectual property and that may be useful to monitor or protect, depending on its value and many other factors. Also, businesses may need to use others’ intellectual property in their marketing efforts and will likely want to avoid infringing others’ property rights as they do.  The following is a brief introduction to one basic area of intellectual property, copyright, and may be helpful. As small businesses develop or update their marketing plans, it may be useful to consult with an attorney about potential intellectual property needs.

Multi-colored graphic of thought bubbles and text boxes connected by arrows

Introducing Copyright Basic Concepts

What is copyright?

Copyright law protects “original works of authorship fixed in any tangible medium of expression. . . “[2] In general, a copyright gives the owner legal rights to reproduce copies, distribute copies, display or perform a work, and develop derivative works.[3]

Some examples of copyrightable works include: websites, pictures, advertisements, musical recordings, business plans, software, sales presentations, and more! Facts and ideas are not copyrightable.[4]

Who owns a copyright?

In general, initially the author of a copyrightable work owns the copyright.[5] However, an employer generally owns the work created by its employees in the scope of their employment.[6] Further, when a certain type of copyrightable work is specially ordered or commissioned from an independent contractor, the party who commissioned the work owns the copyright if there is a written agreement to that effect.[7] Copyright owners can transfer parts or all of their ownership.[8]

How is a copyright created?

When a work that qualifies for copyright protection (e.g., the work is original and expresses a minimal level of creativity) is “fixed in a tangible medium” (for example, when it is written, recorded, or saved in a digital format), it is protected by copyright. As one guide for entrepreneurs put it, “No action is required to obtain copyright protection,” and while a copyright notice may be advisable, it is not a legal requirement.[9] However, registration of a copyright can confer additional rights and benefits, including the right to sue for infringement.[10]

Social Media Platforms and Intellectual Property

Social media platforms offer various opportunities for small businesses to market their products and services, like the ability to connect with large audiences for little or no cost.[11] As entrepreneurs use social media platforms to market their products, services, or businesses, they should be aware that these platforms may have specific policies related to intellectual property. For example, TikTok’s Intellectual Property Policy states that it is a violation of the platform’s Terms of Service and Community Guidelines to post, share, or send content that violates or infringes another’s copyrights, trademarks, or intellectual property.[12] For a deeper dive into music use on TikTok, check out the article, “Music Licensing in the Age of TikTok.”

Developing a Marketing Plan

Outline of head with multi-colored graphics of business icons like pie chart, bar chart, and gearsAs businesses consider their marketing opportunities for the coming year, a written marketing plan may help keep ideas organized, track progress, and communicate plans with key team members. Some questions to consider in developing a marketing plan include:

  • What is the profile of your target customer(s)?
  • What product or service are you marketing?
  • What is your advantage compared to competitors?
  • What promotion strategies will you use?
  • What are your sales goals or forecast?
  • How will you measure outcomes and success?

Tools and Resources for Entrepreneurs

As entrepreneurs build digital marketing strategies, they will likely need images, videos, graphics, and other content. Various online outlets offer imagery like photos, illustrations, graphics, and video, as well as sound like music and sound effects, that are licensed for users to use for little or no cost.

Want to learn how to build a website for your business or enhance your social media marketing strategies?  Connect with the Small Business Development Center at The Ohio State University South Centers, which covers a 10-county region in southern Ohio.

Looking for help developing or updating a marketing plan for your small business? Connect with your local Small Business Development Center (SBDC). SBDC’s offer free business consulting and at-cost training to small businesses across the country. Find your local SBDC online here.

Food and farm entrepreneurs who want to learn more about direct marketing their products can explore the Ohio State University Extension Direct Food & Agricultural Marketing program, including online resources like webinar recordings and short videos.

Important note: This information is provided for educational purposes only. It is not legal advice and is not a substitute for the need to consult with an appropriately licensed attorney.

 

Sources:

[1] “The Legal Implications of Social Media Marketing & Advertising.” (n.d.). Pillsbury Winthrop Shaw Pittman LLP. https://www.pillsburylaw.com/images/content/1/0/v2/102362/FACTSHEET-SocialMediaMarketingAdvert.pdf

[2] 17 U.S.C. §102

[3] 17 U.S.C. §106

[4] Bagley, C. & Dauchy, C. (2012). “The Entrepreneur’s Guide to Business Law: 4th Edition.” South-Western, Cengage Learning: Mason, Ohio.

[5] 17 U.S.C. §201(a)

[6] 17 U.S.C. §201(b)

[7] Circular 30: Works Made for Hire. (2021). United States Copyright Office. https://www.copyright.gov/circs/circ30.pdf

[8] 17 U.S.C. 201(d).

[9] Bagley, C. & Dauchy, C. (2012). “The Entrepreneur’s Guide to Business Law: 4th Edition.” 534. South-Western, Cengage Learning: Mason, Ohio.

[10] Id.

[11] Fountain, T. (Jan. 25, 2021). “Why Small Businesses and Startups Should Invest in Social Media Marketing.” Forbes. https://www.forbes.com/sites/forbesbusinesscouncil/2021/01/25/why-small-businesses-and-startups-should-invest-in-social-media-marketing/?sh=3e686afe563e

[12] Intellectual Property Policy. (June 7, 2021) TikTok. https://www.tiktok.com/legal/copyright-policy?lang=en

Leading the Co-op: Director Key Responsibilities and Board Training Programs

One of the unique aspects of the cooperative business model is that members democratically control the enterprise.[1] Commonly, cooperative members elect a representative board of directors to govern the business.

Cooperative directors are tasked with varied and sometimes complex tasks, from monitoring financial performance to assessing the co-op’s general manager and more. In serving in a vital role in their cooperative, directors also take on various responsibilities – some of them legal in nature. Key among these responsibilities are the fiduciary duties directors owe to members, other directors, and the cooperative.[2]

  • Duty of care – Generally, requires that cooperative directors use care in their actions as judged based on the care that an ordinarily prudent person in a similar position would exercise. Directors are generally expected to make informed decisions, exercise reasoned judgement, and adequately supervise those to whom they delegate responsibilities.[3]
  • Duty of loyalty – Generally, requires that cooperative directors act in good faith and for the benefit of the cooperative, including not receiving preferential treatment compared to other members and appropriately addressing or avoiding conflicts of interest.[4]
  • Duty of obedience – Generally, requires that cooperative directors comply with applicable laws and authorities. It is important for directors to be generally familiar with key authorities like the co-op’s bylaws, articles of incorporation, policies, and other key legal instruments.[5]

A deeper dive into the legal responsibilities of agricultural cooperative directors, “Navigating Your Legal Duties: A Guide for Agricultural Cooperative Directors,” is intended as a practical resource for directors that includes self-assessment tools to help directors identify areas where they can learn more. The resource is published by the National Agricultural Law Center.

For a wider-view of the types of responsibilities that directors take on in leading their cooperative, “The Circle of Responsibilities for Co-op Boards,” by James Baarda is a helpful publication.

Tan office chairs around circular meeting table

Most Cooperatives Provide Board Training in Key Responsibilities

Cooperative board training programs can help directors understand their roles and responsibilities, including ensuring that new directors, and even seasoned directors, have a firm grasp of their fiduciary duties, among other areas. In a survey of 500 cooperatives across industry sectors and the United States, co-op enterprises shared the topics in which they train directors:

  • 80% or more of responding cooperatives train board members in fiduciary duties, financial topics, and the cooperative model
  • Many cooperatives, between 53% and 78% of responding cooperatives train directors in ethics and compliance, industry-specific topics, legal and regulatory issues, and risk management
  • Almost half of responding cooperatives (49%) train directors in corporate social responsibility/sustainability/social impact
  • Some responding cooperatives train their directors in meeting facilitation and conflict resolution – 41% and 32%, respectively[6]

Training is a Key Part of Global Co-op Principles

According to the globally-recognized cooperative principles stewarded by the International Cooperative Alliance (ICA), Principle 5: Education, Training and Information recognizes that, “Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their co-operatives. . .”[7] The ICA’s Guidance Notes on the Cooperative Principles clarify what might seem like a redundant phrasing – education, training, and information have distinct, important meanings:

“ ‘Education’ is about understanding the Co-operative Principles and Values and knowing how to apply them in the day-to-day operations of a co-operative business…”

“ ‘Training’ is about developing the practical skills members and employees need to run a co-operative in according with efficient and ethical business practices and to democratically control their co-operative business responsibly and transparently.”

“ ‘Information’ is a duty to make sure that others who are members of the general public . . . know about co-operative enterprise.” [8]

Graphic of light colored light bulb and hands connecting colored puzzle pieces

A Commitment to Continued Learning: Developing a Board Training Program

As directors navigate complex business landscapes trying to ensure their cooperative enterprise is responsive to members’ needs and remain sustainable over the long-term, training programs can help directors develop their technical and soft skills. To develop a board training program, cooperatives may look both internally and externally. For example, training programs may be specifically constructed and hosted by a local cooperative’s key employees or by a federated cooperative partner. Various education and nonprofit institutions that work with or support cooperative enterprises like councils, cooperative associations, and universities that offer generalized training opportunities and educational resources. Further, industry-based associations, like agribusiness, housing, or financial industry associations, often host learning sessions, updates, and professional development opportunities.

As cooperative managers, directors, entrepreneurs, and developers look toward a new calendar year, prioritizing training that can help directors lead their co-op more effectively may be a worthy goal to add to the list of resolutions!

Important note: This information is provided for educational purposes only. It is not legal advice and is not a substitute for the need to consult with an appropriately licensed attorney.

 

Sources

[1] “Cooperative identity, values & principles.” (2018).  International Cooperative Alliance. https://www.ica.coop/en/cooperatives/cooperative-identity

[2] Scott, H. & Traxinger, M. E. (2021). “Navigating Your Legal Duties: A Guide for Agricultural Cooperative Directors.” National Agricultural Law Center. https://nalcpro.wpenginepowered.com/wp-content/uploads//assets/articles/Co-op-directors-guide.pdf

[3] Id.

[4] Id.

[5] Id.

[6] Berner, C. & Schlachter, L.H. (2022). “Findings from the Cooperative Governance Research Initiative: 2021.” University of Wisconsin-Madison Center for Cooperatives, 31. https://resources.uwcc.wisc.edu/Research/CGRI_2021Report_web.pdf

[7] “Cooperative identity, values & principles.” (2018).  International Cooperative Alliance. https://www.ica.coop/en/cooperatives/cooperative-identity

[8] “Guidance Notes on the Cooperative Principles.” (2017). International Cooperative Alliance, 59. https://ica.coop/en/media/library/the-guidance-notes-on-the-co-operative-principles

3rd Biennial Cooperative Law Conference

Have you heard about the 3rd Biennial Cooperative Law Conference? With the last conference being held in 2020 in virtual format, we are happy to come back together and hold this event as an in-person conference packed with great speakers and informative sessions. This two day event will be held on January 24-25, 2023 at the Nationwide & Ohio Farm Bureau 4-H Center located on The Ohio State University campus in Columbus, Ohio. The conference focus being “Cooperative for the Modern Era”, participants will hear from leading experts in the cooperative field by attending workshops, panel discussions and keynote sessions discussing the tools that cooperatives need to help in the growth of a resilient, and just of a local economy. Networking time is scheduled throughout the day for individuals to connect with others to create and foster cooperative relationships.

For more information and details and how to register for this event, click here.

Who should attend?

Whether you are based in the legal sector, cooperative sector, or interested in the cooperative business model, this conference will offer informative education for all. Encouraging not only those within the state of Ohio, but those in the region to participate! This experience will show how professionals can spark the movement to empower community based initiatives to be the power to change through cooperatives and social enterprise while building relationships through our network.

Keynote Speaker

Keynote speaker Nathan Schneider will be featured on day two, presenting on the topic “21 century cooperatives: multistakeholder, platform, and DAO cooperatives – what’s new? (future of coops)”. Nathan is an associate professor with the University of Colorado Boulder with his studies in religion, technology and democracy has recently focused on democracy ownership and technology. In 2020, Nathan published, “Exit to Community: A Community Primer“, which focuses on how companies can readjust their business model to offer ownership to those within the company to create a community of stakeholders.

Nathan Schneider

This conference is being organized by attorney Jacqueline Radebaugh and several cooperators. Thank you to the following sponsors and all those involved for making this event happen!

 

 

Hope to see you all in Columbus!

Why Small Businesses Should Consider Video in Social Media Marketing

Social media platforms offer numerous opportunities for small businesses as they market their products and services – from free access to broad and vast audiences of potential customers to opportunities to drive traffic to websites where businesses are selling goods or services to tools for selling products and services directly on social platforms.

The importance and reach of video marketing on social media platforms means that entrepreneurs developing their social media marketing strategies and building their digital skills would be well-advised to invest in creating video content. Consider that:

For more information about social media and video marketing, including a helpful overview of how different social media platforms utilize video and tips for effectively incorporating video into marketing for various platforms, check out this guide from Vimeo. Vimeo also has a blog dedicated to video marketing for business with articles and resources ranging from “Small Business Saturday ideas for both planners and procrastinators” to “How to set up Instagram Shopping for your small business.”

Illustrated image of computer screen with various graphics, including play symbol, money symbol, text bubble, light bulb, and megaphone.

Upcoming “Foodpreneur School” to Focus on Social Media Marketing for Food & Farm Entrepreneurs

Food and farm entrepreneurs ready to learn more about using social media marketing and creating impactful video for marketing, join us for “Foodpreneur School” in Hillsboro, Ohio on Tuesday, October 25, 2022! Foodpreneur School is an educational program for food and farm entrepreneurs ready to grow through enhanced sales and marketing. Experts from Ohio State University will teach entrepreneurs about creating impactful video content and effectively using social media for small business marketing. Entrepreneurs are encouraged to bring their preferred devices (mobile phone, tablet, laptop, etc.) for managing their social media presence, as the session will be interactive! Learn more and sign up for no-cost online.

If you require an accommodation, such as translation, to participate in this event, please contact Samantha Black at black.1156@osu.edu or 614-247-9705. Requests made two weeks in advance will generally allow us to provide seamless access, but the university will make every effort to meet requests made after this date.

CFAES provides research and related educational programs to clientele on a nondiscriminatory basis. For more information, visitcfaesdiversity.osu.edu.