2. Module 1. Perspective Setting
Cooperatives as a Tool
for Development
➢ Cooperatives and
Development: Social
and Economics

3. Role of Coops in
Social
Development?

5. The Cooperative movement was one of the first social
movements in modern times. Many social grassroots
movements have turned to cooperatives because of the
damage caused due to globalization and worldwide recession
to improve people's living conditions and empower them.
Many social enterprises are arising from initiative of
grassroots groups and organized and backed by them to
achieve peace, prosperity and social equity. Cooperatives can
offer an alternative to capitalist economy as they are self-
help, not charity and empowerment driven. They put people
at the heart of their businesses to meet their everyday social,
economic and cultural needs (Singhvi, 2011).

6. The United Nations supports cooperatives.
There is a growing consensus among
international agencies about their importance.
The World Bank recognizes the role of
cooperatives in revitalizing the agricultural
sector and the rural economy. Cooperatives
may not solve the world’s problems but are
certainly part of the solution.

7. Concern for community recognizes
that cooperative members also tend
to be members of a particular
community. Often, one of the
business aims for the cooperative is
that it will meet the needs of this
wider community. This does not mean
cooperatives are ‘social’ rather than
economic and can be used as a
development tool (ICA, 2009).

8. Cooperatives empower communities, enabling the people to
respond effectively to challenges such as natural disasters,
humanitarian and economic crises.

9. ICA Vision 2020
These critical themes are:
1 Elevate participation within
membership and governance to a
new level.
2 Position co-operatives as builders of
sustainability.
3 Build the co-operative message and
secure the co-operative identity.
4 Ensure supportive legal frameworks
for co-operative growth.
5 Secure reliable co-operative capital
while guaranteeing member control.

10. An Integrated
and Transformative
Co-operative
System
“Towards a
Globally
Competitive
and Resilient
Cooperative
Industry for A
Progressive
Nation”.
Philippine Cooperative
Development Plan

11. Strategic Goals
1. Enhanced Policy, Regulatory Environment,
and Partnerships;
2. Improved Institutional Development,
Governance, and Management;
3. Sustained Human Capital; Development
among Cooperatives;
4. Globally Competitive Cooperative Products
and Services;
5. Increased Access to Finance; and
6. Increased Access to Markets and
Infrastructure
To build integrated
businesses imbued
with co-operative
values for the
improvement of the
quality of life.

12. Strategic Choices

13. Understanding Social Development
Social means relating to society or its
organization
Social Development refers to the
progressive improvements in the living
conditions of quality of life enjoyed by society
and shared by its members
According to Bilance, 1997 “Social
Development is the promotion of a
sustainable society that is worthy of human
dignity by empowering marginalized groups,
women and men, to undertake their own
development, to improve their social and
economic position and to acquire their
rightful place in society.”

14. environmental
political
economic
Social
The word Development was used for many years to refer
primarily to economic development only. The concept of social
development as different from economic development arose
from the many discussions at national conferences and in many
international meetings under the auspices of the United Nations.

15. The Copenhagen Social Summit,
1995 defined Social Development in
terms of three basic criteria:
Poverty Eradication
Employment
Generation
Social Harmony
Amartya Sen in the 1980s, employed extensively in the context of human development.
Here ‘poverty’ is understood as deprivation in the capability to live a good life,
and ‘development’ is understood as capability expansion.

17. • In a narrower
sense, it would be
used with reference
to the human
welfare aspects of
development, that is
improving the
quality of life and
more equitable
distribution of
material and cultural
goods.
• In the broadest
sense “it
signifies all
aspects of
development
that are of
collective nature
pertaining to the
society as a
whole.

18. SD Concepts
• Invokes the notion of a process
• Role of social welfare states in raising standards of living.
• In Asian countries, governments are reported to use social goals to achieve economic goals
(Welfare developmentalism).
• Some SD writers use the term “transformation” to describe the SD process.
• Multi-dimensional process composed of economic, social, political, and environmental.
Gender and other dimensions are integrated and harmonized.
• Process of SD is interventionist that requires a human agency in the form of projects,
programs, policies, and plans that achieve SD goals.
• SD process is productivist in that practice intervention functions as an investment that
contributes positively to economic development and generates rates of return to the individual,
households, and communities that benefit from this investment and the wider society
• Universalistic in scope as it seeks to promote people’s participation in development.
• Committed to the goal of promoting people’s social well-being.

19. Understanding SD
Several specific social
development goals have been
identified, such as: eradicating
poverty and hunger, improving
education, and literacy, reducing
infant and maternal mortality, ending
gender discrimination and oppression,
enhancing participation in the political
process, and increasing access to
improved sanitation.

20. Social Inequity
According to a study conducted by former Secretary General Romulo Virola (2015) of
the National Statistical Coordination Board, over 74.7% of the population comprise the
lower class, while 0.1% families constitute the upper class, the remaining 25.2% fall
within the “middle class” or the 4.7M families with 5 members. They are the group who
is heavily taxed in the Philippines.
What are the examples of social
inequality in the Philippines?
• Yet inequality remains high: the top 1
percent of earners together capture 17
percent of national income, with only 14
percent being shared by the bottom 50
percent. With an income Gini coefficient of
42.3 percent in 2018, the Philippines had
one of the highest rates of income
inequality in East Asia
AlDub and Philippine Tax
Reform - My Finance MD

21. As of 2022,
$3.20 per day

22. Elite
Population
Middle Population
Poverty Threshold
Social development may be used in connection with structural transformation in
society seeking changes in the system of stratification and in degree of mobility.
Structural
Transformation

23. Agenda 2030
The Sustainable
Development Goals
(SDGs), otherwise known
as the Global Goals, are a
universal call to action to
end poverty, protect the
planet and ensure that all
people enjoy peace and
prosperity.
These 17 Goals build on the successes of the Millennium Development Goals, while
including new areas such as climate change, economic inequality, innovation, sustainable
consumption, peace and justice, among other priorities. The goals are interconnected – often
the key to success on one will involve tackling issues more commonly associated with another.
15 Years 17 Goals 169 Targets 232 indicators

24. Under EO No. 14, signed
January 27, 2023 the
development plan “aims to
“bring back the country to a
high-growth trajectory and,
more importantly, enable
economic and social
transformation for a
prosperous, inclusive, and
resilient society.”

25. SD Strategies
Human capital investment,
employment generation
policies and programs, micro-
enterprises, social capital and
community development,
asset building, community
participation, social activism,
social protection, and national
socio-planning.

26. Cooperatives can engage in a broad range of
activities, the most common being in
(i) education, training, and human resource development;
(ii) community development;
iii) enterprise development and employment generation
(iv) health and nutrition;
(v) law, advocacy, and politics; and
(vi) sustainable development

27. The Community Development Fund shall be used for projects or activities
that will benefit the community where the cooperative operates.
Section 8. Reporting of Social Development Activities of the
Cooperative and the Utilized CDF Social development activities
conducted for the community and the funds utilized for each activity shall
be included in the Social Audit Report of the Cooperative. The amount of
CDF utilized during the year shall be indicated in the Social Audit Report
to determine the balance and the percentage of utilization. Any changes
in the amount of CDF shall be reflected in the Statement of Changes in
Equity.
MEMORANDUM CIRCULAR NO. 2021-01 Series of 2021
REVISED POLICY GUIDELINES GOVERNING THE ALLOCATION AND UTILIZATION OF THE COMMUNITY
DEVELOPMENT FUND (CDF) OF COOPERATIVES

28. The core of cooperative operations,
the poor, excluded and marginalized
sectors of society are usually served
well by cooperatives
Social Responsibility

29. To sustain the drive of cooperatives for social
justice, a strong membership base, bound by
the democratic one-member-one-vote principle,
is essential to addressing weak or unethical
management, or other conflicts of interests
which could divert cooperatives from
addressing social justice issues.
• Social justice, which could be seen
as equal opportunity treatment of all
persons in society. It focuses on the
dignity of each individual.
• Social justice promotes the
participation of each individual in the
development of their society and
enjoys the rewards of that
development.
• Cooperatives have the
responsibility to ensure this happens

30. • Social problems are challenging to
solve single-handedly. To get POs
involved in their programs, civic groups
must develop the ability to formulate
clear goals, draw up a roadmap to
those goals, and communicate the
pivotal role they have to play in
addressing social problems.
Businesses, on their part, must
become more responsive in locating
and selecting the appropriate POs and
NGOs to partner with.

31. Role of Cooperative
in Economic
Development

32. • As governments around the world cut services
and withdraw from regulating markets,
cooperatives are being considered
useful mechanisms to manage risk for members
in agricultural or other similar cooperatives
• Strengthen the communities in which they
operate
• Cooperatives generally provide an economic
boost to the community as well.

33. Cooperatives offer a significant and practical meaning as an employee
benefit mechanism, as a mode of employment and poverty alleviation,
as a safety net for displaced workers, as an empowerment tool for rural
and urban women, as an agrarian reform program, self-reliant and
many more (ILO, 2008).

34. Micro, small and medium
enterprises (MSMEs) have a very
important role in developing the
Philippine economy. They help
reduce poverty by creating jobs
for the country’s growing labor
force. They stimulate economic
development in rural and far-flung
areas. They serve as valuable
partners to large enterprises as
suppliers and providers of support
services. They serve as breeding
ground for new entrepreneurs and
large corporations. A vibrant MSME
sector is thus an indication of a
thriving and growing economy.

37. • Cooperatives have branched out from the traditional production,
marketing and credit and diversified into all kinds of service
cooperatives – housing, electric, and water, transport, medical,
insurance, banking, microfinance and worker cooperatives.
Moreover, they perform various
development functions in their
communities, including health
programs, sports, education and
training, emergency relief,
damayan, religious and social
festivities

38. Through their commitment to
servicing the poor and
underserved, financial
cooperatives are helping to
lessen the burden of
poverty. Financial cooperatives,
by providing savings products,
help to reduce members’
vulnerabilities to shocks such as
medical emergencies. commitment

39. Cooperatives have
also been
instrumental in
promoting inclusive
development in
rural areas, helping
to both strengthen
and diversify rural
economies.
Vertical integration in Hog Meat Marketing Chain: The Case of Sorosoro Ibaba Devt Coop
One of the strategies to improve marketing efficiency is to minimize costs incurred in moving a
commodity between market players from the production point to the consumption point

40. Financial cooperatives provide access
to credit for members who might not
typically have access to the larger
savings and commercial banks. This is
significant in markets where financial
providers are absent owing to poor
revenue prospects, high risks, or high
transaction costs. This access to
financial services often supports the
formation of small and micro
businesses.

41. Cooperatives have also been able to
strengthen agricultural production and
improve access of poor farmers,
especially through engaging in fair trade
arrangements. Small farmers who
struggle to create and sustain businesses
of their own are able to increase farm
revenues, lower marketing and
information-gathering costs, as well as
enter into high-value supply chains that
they would not be able to do on their own.
Linking Farmers to Export Market: The Casa of Subasta
Integrated Farmers MPC

42. Trinidad Vegetable Trading Post Multi Purpose
Cooperative
The establishment of a P20 M food
processing facility in La Trinidad, Benguet
to encourage value-adding of harvests and
to prevent losses.

43. In an era when many
people feel powerless to
change their lives,
cooperatives represent
a strong, vibrant, and
viable economic
alternative.

44.  The need to promote the business
potential of cooperatives so they can
contribute to sustainable development
and decent employment, in the context
of the urgent need for social justice.
 Empowering cooperatives to influence
their capacity to contribute to social
justice requires a sound policy and
legislative framework
How?

45. • Achieving economy of size,
• Improving bargaining power when dealing with
other businesses providing them, among
others benefits, higher income and social
protection
• Purchasing in bulk to achieve lower prices,
• Obtaining products or services otherwise
unavailable
• Access or broadening market opportunities
• Improving product or service quality,
• Securing credit from financial institutions
• Increasing income
• Regardless of the type, size, geographical
location or purpose, cooperatives provide a
unique tool for achieving one or more
economic goals in an increasingly competitive
global economy.

46. To be effective it need to be comprised of nine principles. These
nine principles are:
1. Need to have a multi-faceted and comprehensive strategy
2. Need to strengthen community ownership
3. Need to secure access to credit for local businesses
4. Need to build human resources (leadership development, literacy
development, employment supports, etc.)
5. Need to build local capacity
6. Need to integrate social and economic goals
7. Need to empower a broad range of the community
8. Need to have sound financial management
9. The process needs to be guided by strategic planning and analysis
Bruce (2000)

47. 23 Years old – Average working age
Assistance in :
Upskilling
Upscaling
Youth Development Program

48. Transition to Digital
Economy • The country has seen evident growth of e-
commerce and the digital economy during
the pandemic, as Filipinos turn to a safer
and more convenient methods of purchasing
goods, it was imperative for businesses to
integrate digitalization in their operations. E-
commerce companies and platforms
enabled the consumer market to thrive
during the pandemic. Filipino consumers
now adapting to a more digital way of life.
Coupled with the continued economic
growth, the Philippines is a major focus for
digital transformation.
Marcos administration to ensure economic recovery | Philippine News Agency (pna.gov.ph)

49. By virtue of the principles of co-
operatives, there is an integral
relationship between a
cooperative at its community.
Often not, cooperatives are
acknowledged as playing a role in
community economic
development, cooperatives are
essentially a response to
community development
opportunities or challenges.

50. Cooperatives can also contribute to
increasing social integration and community
cohesion when they specifically address the
needs of the weakest and less privileged
people in society and marginalized groups.
Women find that membership in cooperative
enterprises enables them to achieve economic
empowerment, engage in entrepreneurial
activities and stimulate employment
generation. It also provides them with services
for the growth and protection of their assets

51. Cooperatives are already
playing a strong role in the
economies of local
communities.

53. Reference
• https://uncoopsyear.wordpress.com/category/cooperatives-in-social-
development/