Keeping on Track

To govern and manage your co-op effectively, and to ensure that members remain committed to the co-operative, clear polices and good records are crucial. The policies provide the members with a shared understanding of the requirements and rules that the members have agreed upon. These rules should ensure that all members are treated fairly and equitably while at the same making sure that the operating requirements for the business are effectively met. The records – minutes of meeting, financial statements, bookkeeping etc. – are required to ensure the co-op meets its legal requirements and, more importantly, that the members have shared information in regard to the decisions they have made and the results that are being achieved.


Policies are the basic decisions by the membership about how the co-op should be organized and managed on a day-to-day basis. The size of your co-operative and the complexity of its business operations will strongly influence the types and number of policies the co-op is likely to have. Policies are developed and approved in a variety of ways; however, three broad categories can be identified. The first category are polices that must be approved by the membership at large. These are generally limited in number and relate to key working conditions within the co-op. The second, and usually the largest number of policies, are developed and approved by the board of directors. The third category are policies relating to the details of the operations and often it is the management of the co-op who have the authority approve these policies.

Member education, remuneration, work organization, benefits, vacation and sick leave are some areas in which policies are useful. With established policies, your co-op will be ready to deal with most situations that arise and members will have clear expectations for themselves and their co-members. Policies can also provide guidelines as to how to deal with difficult situations, such as members who have not fulfilled their responsibilities.

It is important to note that the development of policies can take place in many ways. For example, the wage policy would likely be developed in conjunction with the budget and with input from the members, financial managers and some directors. The board may set up committees which include directors and members at large to examine an issue and make a policy recommendation. Management may ask the members working in specific areas of the business to develop operating policies for their specific area of responsibility or develop some policies themselves. Once a specific policy is developed, it is presented for approval to the body within the co-op that has the authority to approve the particular type of policy.

Lastly policies, like many other aspects of the co-op, develop over time as situations change and new issues arise. Sometimes policies which were effective when they were originally developed are no longer effective in a changed situation and need to be modified. At other times, an issue arises for the first time and it becomes apparent that it would be best to have a policy to ensure that any similar situation in the future will be treated in the same manner and without the need for long analysis or discussion.

Record keeping

It is essential for any business to establish a record-keeping system. Many of these records are required by law. They should be filed in a way that is organized and accessible to all members of the co-op. That way, information is readily available to help your co-operative’s development. Here are some of the records you should keep.

Co-op records

You should have a minute book to record all membership meetings and directors meetings. The policy manual should record all policies and changes to policies, including the dates on which they were approved. Each member should have a copy of the policy manual and of the co-op’s Articles of Incorporation and bylaws.

Financial records

Besides routine bookkeeping, you should have separate files for member share and loan accounts, customer accounts, payroll records, Revenue Canada (monthly CPP, UIC remittances), bank statements, budgets, financial statements and tax returns.

Operational records

These files help keep track of things such as production data, work schedules and inventory.

General records

These files consist of anything relevant to your co-op: correspondence, trade magazines, marketing information, contacts, government program information, news clippings, etc.