New Zealand – the world’s most co-operative economy

In 2014, the United Nations declared New Zealand to be the world’s #1 ranked co-operative economy in a survey of 145 nations.


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The United Nations Department of Economic and Social Affairs commissioned an American consultancy, Dave Grace and Associates, to survey the size and scope of the global co-operative economy in 2014. The first ever Global Census on Co-operatives placed New Zealand at number one in both its Co-operative Economy and Social Progress indices.

The survey found that while co-operatives are generally locally owned and operated enterprises, at a national level the co-operative economy comprises more than 10% of the Gross Domestic Product in four countries (New Zealand (20%), Netherlands (18%), France (18%) and Finland (14%)).

In measuring the social and economic impact of co-ops, the analysis took the form of utilizing three ratios that compared the co-operative system in a given country relative to the country’s total population and GDP. These ratios are the membership penetration of co-operatives relative to the total population (i.e., membership /population), employment by co-operatives relative to total population (i.e., employment/population) and annual gross revenue or turnover of all co-operatives in a country relative to the country’s GDP. The top ten countries for each of these measures are shown below in Table 1.

Table 1: Top Ten Countries

Rank

Memberships & Clients/ Population

Employment/Population

Annual Gross Revenue/GDP

1

France

New Zealand

New Zealand

2

Finland

Switzerland

Netherlands

3

Switzerland

Italy

France

4

Austria

France

Finland

5

Dominica

Malta

Luxembourg

6

Netherlands

Finland

Germany

7

Ireland

Germany

Ireland

8

Germany

Netherlands

Italy

9

Cyprus

Spain

Denmark

10

Australia

Norway

Poland

 

Memberships & Clients

The number of memberships/clients in cooperatives relative to the total population provides a measure of cooperative outreach and consumer value. This assumes that cooperatives in a given market are providing value to their members/clients, as has often been shown in studies. While some surveys that include this membership penetration rate rely only on the adult population in a country, because of the presence of educational, social and health cooperatives and the desired to include youth cooperatives we measured memberships/clients relative to the total population not the adult population.

With this measure we find that 1 in every 6 people on average in the world has membership or is a client of a cooperative.

Employment

A strong argument could be made that in measuring cooperative employment relative to only the adult population in a country should be used. However, for consistency we also use total population in this measure. It should also be noted that these employment figures are considered formal employment and could be significantly under represent the actual employment. Most notably is that an employment figure for the agricultural cooperatives in China was not available as the it was indicated that many farmers contribute their labor to the cooperative and income is derived from the sale of products through the cooperatives. While these agriculture cooperatives have volunteer labor many also have employees but data was not available. That said we did not find evidence of cooperative employment being near 100 million as the ILO had previously estimated.

Annual Gross Revenue

While many researchers are beginning to use alternative measures besides GDP to measure progress and output in a society, we believe that there is still great value in looking at GDP relative the cooperatives’ revenues. This was the least reported on of the six measuring in the Global Census on Cooperatives. As such, these national, sector and global totals should be considered minimums for cooperatives economic contributions to national revenue.

Introduction of the Cooperative Economy Index

While individually these three measures may not be the most robust measures of an industry’s economic or social contribution to society, taken together they can be an important signpost for diverse organizations across diverse countries. As with indexes our Cooperative Economy Index benefits from multiple measures that limit the rankings being determined by any single factor.

The memberships, employment and gross revenue ratios are evenly weighted within the Cooperative Economy Index to provide a single measure to determine the most cooperative economies globally. Summary results for the Cooperative Economy Index are below.

Table 2: Cooperative Economy Index

Rank

Cooperative Economy Index

1

New Zealand

2

France

3

Switzerland

4

Finland

5

Italy

6

Netherlands

7

Germany

8

Austria

9

Denmark

10

Norway

In compiling our results on the most cooperative economies in the world we were amazed that two-thirds of the countries listed in the top ten most cooperative economies also make up 8 of the top 12 spots on the Social Progress Index (SPI). The SPI has 54 measures and includes items like basic human needs, opportunity and access to knowledge. It has been developed and promoted by the Social Progress Imperative. While it’s beyond the scope of this project to determine if there is any cause and effect between cooperative economies and social progress, there does appear to be a high level of correlation among these two lists.

Table 3: Social Progress Index and Cooperative Economy Index

Rank

Social Progress Index (SPI)

Cooperative Economy Index (SPI Ranking)

1

New Zealand

New Zealand (1)

2

Switzerland

France (20)

3

Iceland

Switzerland (2)

4

Netherlands

Finland (7)

5

Norway

Italy (29)

6

Sweden

Netherlands (4)

7

Canada

Germany (12)

8

Finland

Austria (11)

9

Denmark

Denmark (9)

10

Australian

Norway (5)

© Dave Grace and Associates|United Nations

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