A distinguishing feature of a co-operative is that it:
Multiple Choice
is only intended to operate for a limited period of time.
is owned and operated by the people who use it.
maintains a distinct separation between ownership and management.
can have no more than 75 ?owners, all of whom must be citizens of Canada.
The correct answer and explanation is:
The correct answer is:
is owned and operated by the people who use it.
Explanation:
A co-operative (or co-op) is a unique business model that operates based on a set of principles which distinguish it from other types of businesses. The most fundamental characteristic of a co-op is that it is owned and controlled by the people who use its services or products. This is known as the “user-owner” principle.
In a co-operative, each member (who is typically both an owner and a user) has an equal say in the decision-making process, regardless of how much capital they have invested. This is often referred to as the “one-member, one-vote” system. The goal of a co-operative is to meet the common needs and aspirations of its members, whether they are customers, employees, or producers.
Key features of a co-operative include:
- Democratic control: All members participate in the decision-making process, usually through an annual general meeting where major decisions are made.
- Member economic participation: Members contribute to the capital of the co-op and share in its profits or losses, based on their use of the cooperative’s services.
- Voluntary and open membership: Co-ops are generally open to anyone who wants to join, provided they meet the necessary criteria and can benefit from the co-op’s services.
- Service over profit: The primary goal of a co-operative is to serve the needs of its members rather than to maximize profit for outside shareholders.
- Community focus: Many co-operatives are committed to benefiting the broader community, not just the individual members.
In contrast to other business models where ownership and control are often separate from users or consumers (as seen in publicly traded companies), co-operatives break down this divide by aligning the interests of owners and users. This makes them distinctively different from traditional business structures.
Thus, the correct answer emphasizes the ownership and operational structure of a co-operative being centered on the people who directly benefit from its services.