The concept of profitability in cooperatives
An ILO report highlights that the cooperative economy does not seek to maximise profits but rather to generate social value and meet the needs of its members.
The International Labour Organization (ILO) has published a document whose goal is to clarify the relationship between the cooperative model and the concept of profitability. The United Nations body addresses common misunderstandings in the interpretation of cooperative economics, explaining that while cooperatives must be economically viable, their primary goal is not to maximize profits for outside shareholders.
Profitability in cooperatives: a new business model
The ILO report highlights that for a cooperative any financial surplus will be a means to an end (for example, of meeting the needs of its members), rather than an end in itself. By reinvesting surpluses in better services, lower costs or social projects, cooperatives prove that they are a sustainable and ethical alternative to capital-centred business models. This clarification is particularly relevant for health cooperatives, where the priority is always the well-being of patients and the professional dignity of health personnel.
