1991 – Cooperative Development group

Cooperative Leadership & Cooperative Values

Cooperative Leadership


Cooperative Values

V Kurien


National Dairy Development Board

Anand 388 001


The Cooperative Development group of the National Dairy Development Board initiated the Field Information Service(FIS) some three year ago. The main objective of the FIS is to create an awareness and share related developments amongst the people closely connected with the cooperative activities. Through the Field Information Service we have made an attempt to disseminate information covering various issues suck as cooperative management, cooperative leadership, tasks of cooperative managers, cooperative legislation, role of dairy cooperatives, role of women in cooperatives etc. – besides the speeches delivered by eminent persons/cooperators.

We are privileged that for our 100th issue, we are reprinting an article on “Cooperative Leadership and Cooperative Values” by Dr V Kurien, Chairman, NDDB from “The Cooperative Perspective” (special commemorative issue- ’91) by VAMNICOM. Today, the cooperative movement is at a cross-roads – while on the one hand, many spectacular developments have taken place, on the other, never before in its history has it fallen on such bad days. As Dr Kurien rightly points out “A movement which should place the instruments of development in the hands of people has been hijacked by a coterie of individuals whose lack of knowledge of cooperation is matched only by the arrogance of their pretentions and the rapacity with which they appropriate what was created by and belongs to our farmers.” We are sure that this article will make all of us think and ponder as to where the cooperative movement is heading today.

Cooperative Leadership and Cooperative Values

Anyone, who truly believes that cooperative is important to our nation’s development cannot but weep at the state of affairs today. A movement which should place the instruments of development in the hands of the people has been hijacked by a coterie of individuals whose lack of knowledge of cooperative is matched only by the arrogance of their pretensions and the rapacity with which they appropriate what was created by, and belongs to our farmers. It is, therefore, both appropriate and essential that we examine the role of cooperative leadership in protecting, preserving and exemplifying the value of cooperative. Once we have done so, we must then examine the ways in which we can ensure that the leadership which evolves will play its role properly.

Let it be clear that, even today, there are honorable exceptions: there are leaders who have a clear and correct concept of cooperation and who strive to protect these values against the depredations of those who seek power, patronage and self-aggrandizement. Unfortunately, these honorable and committed leaders from the exception. How far we have travelled from the day when pillars of principle and probity like Shri Vaikunthbhai Mehta gave us all hope that cooperative would transform rural India.

If we are to realize the dream of our early cooperators, then we must ask what is a leader and what is a leader and what are cooperative values.

I would submit that a leader is not simply someone who, by hook or by crook, has managed to occupy a chair. Leadership involves far more than that. True leadership is based not on force, favor or factionalism; rather it is based on vision, integrity, and courage. A true leader does not lead because he can manage to mobilize a group of undesirable elements to advance his cause; he leads because he has a clear vision of what people can achieve together and a commitment to see it through. A true leader does not use patronage – and worse – to win the loyalty of his followers; he consistently acts on principle and leads on the basis of the respect that integrity engenders. A true leader does not survive because he is able to pit one group against another, and to deftly shift sides and causes at each turn of the tide; he is an individual of courage and conviction, ready to stand on principle and committed to unify rather than divide.

Those of us who have worked with our nation’s rural people know that the qualities of leadership are found in men and women in all our villages. The more so because most of the unscrupulous have gone to our cities. It was our dream that cooperatives would provide a training ground for these leaders; equipping them with the skills, adding depth and breadth to their vision and steeling their commitment to serve their people with honour and integrity.

Why then, When we survey the landscape of cooperation, does the scenery appear so bleak. Why is it that instead of women and men of class and character, we find our unions and federations led by those who hardly represent the interests of the thousands or tens of thousands whose resource – and very futures – are in their trust?

The first culprit is our cooperative law and regulation.

When our colonial masters decided that cooperatives would help to quell rural discontent, they did so with a view that the “native” could not be trusted. And, therefore, they evolved a framework of law and regulation that was designed to give the powers of life and death to registrar. How naïve of the worldly British lords to believe that honesty could be compelled from without, when, as should be obvious, it can only be enforced from within.

Because we simply continued the British law, only adding to it new ways and means to in interfere, we opened the door to all forms of misuse and abuse of cooperatives by and all who were so inclined. Thus we have evolved a nexus of politician and bureaucrat which has appropriated not only the resources that truly belong to our farmers, but the dream that was once called cooperation.

I must next fault our bureaucrats. Our Constitution has created an All India Service for the purpose of providing the nation with a strong backbone of ability, wisdom and principle. I fear the reality has defeated the purpose. How many administrators, given the responsibilities of a Registrar, have carefully considered the principles and techniques of cooperation and conducted their office in consonance therewith? I fear it has been very few.

When has an administrator, assigned to manage a cooperative federation engaged in a complex and specialized business, said with honesty and humility that such an enterprise should be managed by an experienced professional, not a generalist administrator? I know of no such instances.

How many administrators have sought to clearly understand the important link of accountability that is essential to cooperation: management accountable to a board which, in turn, is accountable to the members? How many have then tried to ensure that all the conditions were met ensure that this link was maintained and strengthened? I know of very few.

How many of our administrators – those who are fond of calling themselves the “friends, philosophers and guides” of cooperation and who rue that inherent problems of our society render it inevitable that cooperatives will fail – How many of them recognize that what they call cooperatives are not cooperative at all, but simply state enterprises with a different label? Very, very few.

Let us also ask, how many administrators have connived with politicians to delay or manipulate cooperative elections? How many sit in air-conditioned offices, ride in air conditioned cars, and furnish their homes and feather their nests with the fruits of the farmers toil? I fear it has been all too many.

Last, and most important, I fault ourselves. We who have believed in cooperation believed that leaders would not only intuitively grasp the principles and values of cooperation, they would seize them with a commitment sufficient to ensure that no temptation or threat could divert them from their course. We failed to understand the need to educate, to train and to nurture the values on which cooperation must be built.

What are those values? They are part and parcel of the principles of cooperative, principles that have been formulated- indeed they have been formulated under the chairmanship of one of our most distinguished cooperative leaders: Professor Karve. Those who would search for cooperative values must begin with these principles.

The first principle is open and voluntary membership. This, like most of the principles, is not well understood. It does not mean that anyone and everyone has the right to become a cooperative member! It means that no one who needs the services of the cooperative and is willing to accept the responsibilities of membership should be denied that membership on the basis of religion, caste, political affiliation or other artificial distinctions.

Thus, the first set of values which our cooperative leaders should promote and protect are those that ensure that our cooperatives are truly open and voluntary. This means that they must educate and encourage cooperatives to enroll all genuine applicants without consideration of their caste, their party, their community. It means, too, that our leaders must recognize and respect the true producer – even as is often the case with our dairy cooperatives if that producer is a woman . It means that our leaders must fight any attempt to enroll members for political purposes. It also means that ownership – including equity – is limited to genuine users and that government, in whatever form, is not eligible for membership and should not hold owner equity in a cooperative. Above all, it means that they must recognize that those who belong to the cooperative are those who will use its services, building it into an institution that benefits the community at large.

The second principle of cooperation is democratic governance. It quite simply means that the owners of a cooperative – its members- have the right and responsibility to govern its affairs, both directly and through the leaders they elect.

This leads to the second set of cooperative values: our leaders must defend the right of cooperative members to govern their own enterprise. They must fight any attempt to defer, delay or manipulate election. They must ensure that the members and their elected leaders have the right to hire and to fire their chief executives. They must ensure that the members have timely access to the information they need to take decisions wisely- including an accurate, honest and timely audit.

The third principle of cooperation is perhaps the least understood: limited return on equity. When cooperative members invest in equity, they are building a business that they hope will benefit them to the extent that they patronize it. They are not investing for a direct return.

This leads to the third set of cooperative values: our leaders must turn away from reliance on government as the source of capital. They must find ways and means to encourage the owners of a cooperative to invest in building their own business in order that they may, over time, gain a greater benefit. And the best way to encourage such investment is to ensure that the cooperative operates with honesty, economy, efficiency and provides its owners with the services they require.

The fourth principle of cooperation is equitable distribution of surplus: any profit should be allocated in a way that either builds the enterprise, or to the members in a manner proportionate to each member’s business.

This leads to the fourth set of values: our leaders must see that there is a surplus, an objective that can be achieved only when they exercise their responsibilities with honesty and diligence. They must also ensure that the profit is invested in strengthening the business and in patronage return to members. It must not be spent for the benefit of the few, whether leaders or managers or any group of members.

The fifth principle is cooperation between cooperatives. This means that both in business and in protecting the interests of cooperation, cooperatives should work together, extending the benefits of cooperation in even wider circles.

This leads to the fifth set of values: our leaders must actively find ways to work with each other, not to benefit themselves, but to strengthen the role of cooperatives and the benefits to their member.

The last principle is cooperative education : cooperatives should actively seek to educate their leaders, employees, members and the general public in the principles and practices of cooperation.

This leads to the sixth set of cooperative values and perhaps the most important. While it is important that our cooperative leadership plays the role of an educator, it is far more important they educate through example. That is to say, our cooperative leaders should not only speak, but live the principles of cooperation. This would entail, among other things, that they know closely the following values:

To seek, to apply genuine cooperation in every sphere of human activity;

To respect the views of the majority, whether they be members of a cooperative or the public at large;

To promote, nurture and defend democratic governance both within and without the field of cooperative;

To act in the greater interest of the cooperative and the community at large, not in self –interest or ht interest of a group;

To respect the trust of leadership by acting with integrity and principle in every way;

To study, so as to be able to clearly understand, promote and protect the principles of cooperation;

To face any assault on cooperation and its principles with courage and determination.

I am sure that the reader is now thinking, “such lofty principles are mere rhetoric. How can we expect our cooperative leaders to put aside their self-interest and act in such an honorable and selfless way?”

I would argue that it is in our cooperative leadership’s self – interest to act precisely in the way I have described. What benefits ultimately accrue to the leader, who everyone knows has looted a cooperative, or filled its posts with his friends and families, or abused his trust by giving contracts and benefits in return for favours ? While such “leader” may survive for a while, ultimately they earn their just rewards.

Think, for a moment, what benefits might accrue to the cooperative leader who works selflessly, with dedication, diligence and honesty, to build a vital, strong cooperative structure. Would not that individual earn the respect, trust, admiration and – if he or she may so choose – the votes of the thousands, or tens of thousands, whose lives have improved as a result? That is real self-interest.

How, then, can we help to ensure that our leadership becomes the true guardian of cooperative values? I believe that the answers should be self- evident.

First, all who truly believe that genuine cooperation is important to our nation’s development must join to ensure that our present archaic and repressive cooperative legislation is replaced by new laws that place responsibility and accountability where they belong, with those who own their cooperatives.

Second, even now our present generation of cooperative leaders must recognize, and must act to preserve and protect those rights that they have even under the present law. They must say no to regulations that are illegal and, if necessary, they must seek the assistance of the courts to establish that principle. They must find ways and means to return to the government the equity that presently acts as an excuse for interference and control. They must thank the government for having so kindly loaned its officers to assist them in their early stages but make clear that they now need true professionals to achieve their potential. They must build their membership into a constituency that is able and willing to act to defend the interests of cooperation.

Third, those in government who understand cooperation and its principle, must take the lead in withdrawing from the over regulation and direct management of cooperative, leaving these people’s institutions to regulate and manage themselves.

Fourth, we must all bring the same energy and commitment in educating and training a new generation of leaders that we earlier brought to the promotion and support of cooperatives. This must begin with the education of the members and must continue until each cooperative institution, whether society, union or federation, is led by individuals whose purpose is to serve with diligence, commitment and virtue.

It is now a great many year since, by accident, I happened to become involved with cooperatives. It was my good fortune to work with leaders like Shri Tribhuvandas Patel, who exemplified the principles and practices of cooperation. And I saw how these principles could transform the lives of tens of thousands of people.

If we can again create the environment, opportunity and education, our village will provide a new generation of leaders who will not only rebuild our cooperative movement, but help us to build a truly great nation. This, Then, is the task ahead. We know it can be done. We know how to do it. It is only a question of whether we have the will to proceed.