Building a Secured Society through HRD Efforts in

Cooperatives

MKM

Professor Dr. Rosmimah Mohd RoslinCooperative College of Malaysia

Secured Society depicted as….

• A society that is free from social anxiety, fear of poverty, and able to sustain its economic standing

• How?– Able to generate income– Well trained to undertake specific income

generating jobs– Honing of business acumen

• Secured society through:– A more equitable distribution of income• The propensity to consume

– Self sustaining– Able to meet general standard of living

• This could only be done through well developed training programs in human resource development

HRD Efforts in Cooperatives• Cooperatives are viewed as important vehicles

for community development because they mobilize local resources into a critical mass and their structure allows them to be more community oriented (Wilkinson & Quarter, 1996)

• Co-ops are institutions of choice to bring economic opportunity to underserved areas.

HRD Efforts include:

• Education and Training– Academic Programs– Setting up of Cooperative Academic Institutions

• Skill Building Programs– Vocational programs– Business training skills

Cooperatives Contribution

• Estimates of the number of cooperatives and their impacts on the world economy vary widely, but their impact is extensive.

• It is estimated that approximately 800 million people worldwide are members of cooperatives, and another 100 million are employed by cooperatives

(Schramm, 2007)

• Economically, the cooperative business model has helped millions of low-income individuals in developing country improve their economic standing

• Providing security to the poor by converting individual risks to collective risks

• Remote, rural regions, where most poor people live, tend to be less profitable for other forms of enterprises and unattractive to investors because of scattered and low levels of production, high transaction costs and long distances to market.

• Cooperatives allow entrepreneurs to overcome many of the market barriers that exist in developing countries

• Democratically, co-op members learn firsthand the principles of democratic governance, transparency and member participation.

• Cooperative membership gives subsistence producers and other impoverished people a voice and a chance to take charge of their destinies.

• This experience provides a sense of ownership of the local political process; it sets an example of organizational efficiency, transparency and accountability; and it creates a practical vehicle for conflict management through jointly vested interests.

• Socially, co-ops increase trust and solidarity, leading to social well being and stability ,in some cases in the face of adverse conditions and conflict.

• Through development programs, cooperative members learn the relationship between serving their own needs and the viability of organizations

WELL TRAINED COOPERATIVES – A QUESTION OF IMPACT

A Malaysian Experience

The Malaysian Experience – Cooperatives and Business Ventures

Types of Projects Applications Received Applications Approved

Numbers Amount (RM) Numbers Amount (RM)

2010 2011 2010 2011 2010 2011 2010 2011

1. Services

Contractual work 35 33 9,994,380 13,915,750 20 33 3,777,000 8,425,641

Retail 40 113 12,515,000 33,360,000 30 93 4,462,900 19,222,000

Finance 42 105 102,700,000 257,000,000 25 61 42,548,500 109,507,000

Transportation 26 30 25,624,206 18,413,298 24 17 23,463,486 4,415,842

Tourism/Health 2 8 992,435 1,968,000 - 4 - 811,036

2. Agriculture 33 28 40,502,067 27,123,600 18 22 18,188,300 13,786,900

3. Construction 62 75 47,926,32 98,502,777 50 52 25,648,539 40,808,905

4. Manufacturing 1 3 1,800,000 10,150,000 - 1 - 50,000

Total 241 395 242,054,417 460,433,425 167 283 118,088,725 197,027,326

Impact of Business VenturesIn the year 2010 Year of Loan Application

Number of members Frequency Percentage (%) Frequency Percentage (%) Less than 100 members 15 7.4 18 8.8 100 - 300 members 41 20.1 49 24.0

301 - 500 members 47 23.0 45 22.1

More than 500 members 101 49.5 92 45.1

Capital Share

Less than RM10K 8 3.9 19 9.3

RM10K-RM50K 19 9.3 27 13.2

RM51K-RM100K 19 9.3 23 11.3

More than RM100K 158 77.5 135 66.2

Assets of Cooperatives

Less than RM50 K 13 6.4 40 19.6

RM50 K-RM100 K 18 8.8 22 10.8

RM101 K-RM500 K 50 24.5 42 20.6

More than RM500K 123 60.3 100 49.0

Allocation for Members’ Welfare Funds

Less than RM10 K 105 51.5 125 61.3

RM10 K-RM50 K 50 24.5 41 20.1

RM51 K – RM100 K 29 14.2 22 10.8

More than RM100 K 20 9.8 16 7.8

Dividend Allocation

Dividend not allocated 66 32.4 82 40.2

Dividend allocated 138 67.6 122 59.8

• Contemporary community development paradigms encourage communities to rely on their internal resources (human, social, environmental, financial, and physical) to solve community problems.

• The willingness of people to cooperate and trust is a fundamental building block in a cooperative development strategy.

• Communities that are well trained in specific skills are more likely to be self sustaining economically.

References

• Schramm, S. G.(2007). Cooperatives: Pathways to Economic, Democratic and Social Development in the Global Economy, www.ocdc.coop. [Accessed 18 October, 2012]

• Wilkinson, P. and Quarter, J. (1996). Building a Community-Controlled Economy: The Evangeline Co-operative Experience. Toronto, Ontario, Canada: University of Toronto Press.