CommonWise Enterprise – Data Collection
I. Development Banks:
- Define their typical scope of activities
- Have any perused a “progressive,” sustainable development agenda
- How are they funded
- What is their governance structure
II. Small Business:
- Quantify the efficiency & effectiveness of job creation as compared to
large companies
- Capital:
o Why is it so hard to access capital?
o What programs currently serve small business?
 Quantify the programs in terms of businesses served and
dollars loaned
 What are the strengths and weaknesses of those programs
o Quantify the investment risks for:
 Start-ups
 Going concerns
o What are the primary reasons that small start-ups fail?
o What are the primary reasons that small going concerns fail?
o What would most effectively mitigate against these risks?
o How do the terms of loans and interest rates compare to the
terms upon which large companies access capital?
o Where does start-up capital most come from?
o How does this vary for Co-Ops & ESOP’s
III. Cooperatives and ESOP Companies:
- How do Cooperatives and ESOP’s perform financially vs. shareholder
businesses? For example:
o The Employee Ownership Index (EOI) has consistently
outperformed the FTSE All-Share. In cash terms, an investment
of £100 in the EOI in 1992 would have been worth £349 at the
end of June 2003; the same amount invested in the FTSE AllShare would have been worth £161.
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I. Development Banks:
- Define their typical scope of activities
- Have any pursued a “progressive,” sustainable development agenda
- How are they funded
- What is their governance structure
Research
Multilateral development bank (MDB)
A multilateral development bank (MDB) is an institution, created by a
group of countries, that provides financing and professional advising for the
purpose of development. MDBs have large memberships including both
developed donor countries and developing borrower countries. MDBs finance
projects in the form of long-term loans at market rates, very-long term loans
(also known as credits) below market rates, and through grants.
The following are usually classified as the main MDBs:
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World Bank
African Development Bank
Asian Development Bank
European Bank for Reconstruction and Development
Inter-American Development Bank Group
There are also several "Sub-Regional" Multilateral Development Banks. Their
membership typically includes only borrowing nations. The banks borrow from
and lend to their members. These banks include:
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Corporación Andina de Fomento (CAF)
Caribbean Development Bank (CDB)
Central American Bank for Economic Integration (CABEI)
East African Development Bank (EADB)
West African Development Bank (BOAD)
Black Sea Trade and Development Bank (BSTDB)
Eurasian Development Bank (EDB)
There are also several Multilateral Financial Institutions (MFIs). MFI's are
similar to MDBs but they are sometimes separated since they have more
limited memberships and often focus on financing certain types of projects.
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European Commission (EC)
European Investment Bank (EIB)
International Fund for Agricultural Development (IFAD)
Islamic Development Bank (IDB)
Nordic Investment Bank (NIB)
OPEC Fund for International Development (OPEC Fund)
Nederlandse Financieringsmaatschappij voor Ontwikkelingslanden NV
(FMO)
The Public Banking Institute
http://publicbankinginstitute.org/about-us.htm
The Public Banking Institute (PBI) is a non-partisan think-tank, research and
advisory organization dedicated to exploring and disseminating information on
the potential utility of publicly-owned banks, and to facilitate their
implementation. PBI was formed in 2011 as an educational non-profit
organization by a group of citizens including past and present community and
civic leaders, businesspeople, educators, political economists, writers, and
banking and other professionals. The group shares a concern over the
destabilizing actions of a private banking industry that, through its corporate
business model, has precipitated the economic imbalances now witnessed
across the US economy.
PBI seeks to explore the possibilities for, and to facilitate the implementation
of, public banking at all levels -- local, regional, state, national, and
international. Its approach is informed by the historic role of public banks in
fostering access to cheap and readily available credit for governments,
businesses, and individuals, particularly with respect to creating productive
capacity.
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Bank of North Dakota
http://www.banknd.nd.gov/
About BND
Deposit Base
In contrast to most commercial banks, Bank of North Dakota (BND) is not a
member of the Federal Deposit Insurance Corporation (FDIC). North Dakota
Century Code 6-09-10 provides that all BND deposits are guaranteed by the
full faith and credit of the State of North Dakota.
The deposit base of BND is unique. Its primary deposit base is the State of
North Dakota. All state funds and funds of state institutions are deposited with
Bank of North Dakota, as required by law. Other deposits are accepted from
any source, private citizens to the U.S. government.
Policy and Governance
The state Industrial Commission oversees Bank of North Dakota, as mandated
by the 1919 state legislature. Members of the Industrial Commission are the
Governor, who acts as chairman, the Attorney General and the Commissioner
of Agriculture of the State of North Dakota.
The Bank also has a seven-member Advisory Board appointed by the
Governor. The members are knowledgeable in banking and finance. The
Advisory Board reviews the Bank's operations and makes recommendations to
the Industrial Commission relating to the Bank's management, services, policies
and procedures.
Assessing Mondragon: Stability & Managed Change
in the Face of Globalization
By: Saioa Arando, Fred Freundlich, Monica Gago,
Derek C. Jones and Takao Kato
November 2010
http://webcache.googleusercontent.com/search?q=cache:7S2TL53jYBIJ:wdi.u
mich.edu/files/publications/workingpapers/wp1003.pdf+how+resilient+was
+Mondragon+in+2008+recession%3F&cd=9&hl=en&ct=clnk&gl=us&client
=safari&source=www.google.com
Assessing Mondragon: Stability and Managed Change
in the Face of Globalization
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Saioa Arando, Fred Freundlich, Monica Gago, Derek C. Jones and Takao Kato
November, 2010
Abstract
By drawing on new interview evidence gathered during several field trips and
new financial and economic data from both external and internal sources, we
document and assess the changing economic importance and performance of
the Mondragon group of cooperatives as well as the two largest sectors within
the group. Compared to conventional firms in the Basque Country and Spain,
and producer co-ops (PCs) and employee owned firms elsewhere, in general we
find evidence of growing group importance and strong performance and a
similarly strong record for the industrial and retail divisions. These stylized facts
do not support hypotheses concerning PCs such as predictions that PCs will
restrict employment and become progressively comparatively undercapitalized.
In accounting for this record, we highlight key and, at times, not
uncontroversial institutional developments in the group during the last 20 years
or so that indicate the existence of a continuing capacity for institutional
adaptation in Mondragon-- an ongoing ability to innovate and make
institutional adjustments to deal with emerging challenges. In addition, we
provide more detailed information than before on some key distinguishing
institutional mechanisms of the Mondragon group, including the extent of
worker-member transfers during economic crises, the patterns of profit pooling
and the type and volume of training. The aggressive and extensive use of these
and related mechanisms, themselves formulated and refined only after a
deliberative democratic process, may help to account for some of the
outstanding features of the Mondragon group record. Overall these findings
represent suggestive evidence that groups of employee-owned firms are feasible
and sustainable organizational forms; in a world of declining labor power and
tepid employment recovery by private firms, the institutional arrangements at
Mondragon are worthy of deeper study by many including policy-makers,
other co-ops and other employee-owned firms.
Public Banking Institute
http://publicbankinginstitute.org./home.htm
Public Banking's Background
Public banking is banking operated in the public interest, through institutions
owned by the people through their representative governments. Public banks
can exist at all levels, from local to state to national or even international. Any
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governmental body which can meet local banking requirements may,
theoretically, create such a financial institution.
Public banking is distinguished from private banking in that its mandate begins
with the public's interest. Privately-owned banks, by contrast, have
shareholders who generally seek short-term profits as their highest priority.
Public banks are able to reduce taxes within their jurisdictions, because their
profits are returned to the general fund of the public entity. The costs of public
projects undertaken by governmental bodies are also greatly reduced, because
public banks do not need to charge interest to themselves. Eliminating interest
has been shown to reduce the cost of such projects, on average, by 50%.
When the public interest demands, the mission of public banks is to respond
immediately, to assure the long-term prosperity of the community. In the U.S.,
the Bank of North Dakota is a prime example of such a public bank.
Triodos Bank
http://www.triodos.comMission
Find out how we make money work for positive change
Triodos Bank is one of the world's leading sustainable banks. Our mission is to
make money work for positive social, environmental and cultural change.
More specifically, we are in business to:
•
Help create a society that protects and promotes the quality of life
of all its members
•
Enable individuals, organisations and businesses to use their
money in ways that benefit people and the environment, and promote
sustainable development
• Provide our customers with innovative financial products and high quality
service
Core Activities
Triodos Bank's overall approach to sustainable banking
At Triodos Bank, there are three main ways in which we work to deliver on our
promise of sustainable banking:
As a sustainable service provider
Our customers don't just want products and services that support sustainable
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development. They also expect competitive prices and a professional service.
So our aim is to provide a range of services that satisfy all these requirements,
to an equally high standard.
By doing this, we have created a broad customer base - a powerful international
community of individuals, businesses and organisations with a shared desire for
positive social, cultural and environmental change.
As a product innovator
The more customers we reach, the more good we can do. So we're constantly
working to develop innovative new products, which we can make available
both directly through Triodos Bank and also via third parties.
In The Netherlands, for example, a range of sustainable Triodos investment
funds is now offered to the general public by other banks - and achieving rapid
growth, as a result.
As an opinion leader
We believe an important part of our role is to stimulate and lead public debate
on issues including our quality of life, social and environmental development,
and sustainable banking.
How we invest
A rigorous process that ensures sustainable success
So how do we ensure that the money our clients entrust to us is invested only
in companies with the best sustainability performance? The short answer is we
leave nothing to chance. We have strict social, environmental and governance
criteria, and a rigorous research and selection process that provides a firm
foundation for every investment decision.
Research and consultation
At Triodos Bank, we have our own Sustainability Research Department,
responsible for keeping us up to date with the latest thinking on sustainability
issues, monitoring legislative and regulatory developments, and ensuring that
our selection process is based on the most relevant and reliable information
available. In addition, to give us a broader perspective on what are often very
complex issues, we've set up an international advisory panel which is made up
of leading international experts, representing various interest and stakeholder
groups.
A three-stage selection process
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Selecting listed companies for inclusion in the Triodos Investment Universe is
a rigorous and systematic process. To ensure they meet our social and
environmental requirements, companies are screened against a wide range of
criteria, in a three stage process:
Step 1: Sustainable activities
We've identified certain types of products and services that contribute to the
health and wellbeing of people and planet. Any company that derives over 50%
of its revenues from sustainable activities of this kind qualifies for Triodos
investment, provided they also pass step 3.
Step 2: Best-in-class
Companies that don't meet the step 1 criteria above can still qualify for
investment if their all-round sustainability performance puts them among the
best in their sector. We assess this using over 70 generic and sector-specific
criteria, relating to environmental, social and governance issues. And
companies whose score puts them in the top 50% within their sector qualify
for Triodos investment, provided they also pass step 3.
Step 3: Minimum standards
Our minimum standards are Triodos Bank's bottom line: the absolute criteria
we apply to ensure that we never fund any business engaged in any activities
that are harmful to individuals, society or the environment. Companies that
qualify through steps 1 or 2 must also meet these requirements before we'll
consider investing in them.
Once companies have passed step 3, they are added to the sustainable universe.
The actual investment decisions are made by our external asset manager. From
our sustainable universe the external asset manager carefully selects the
companies that are considered to have the best financial forecasts.
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As you'll see elsewhere on this site, many of our people are acknowledged
experts in their fields, and we strongly encourage them to take part in all
relevant forms of discussion and consultation. We want our long and wide
experience in promoting sustainable development to make the biggest possible
difference.
Maximizing our influence on the companies we invest in
With the money entrusted to Triodos SRI funds comes the responsibility - and
the power - to influence the way the companies in which we may invest do
business. So, as a key element of our SRI strategy, we pursue a policy of active
engagement and dialogue, with the aim of raising awareness of sustainability,
stimulating action and creating lasting change.
Vancity - Vancouver City Savings Credit Union
https://www.vancity.com/Development finance institution
Tamara Vrooman - Chief Executive Officer, Vancity
Sure, we’re proud of the fact that our 400,000 members have entrusted us with
$14.5 billion of their assets, making us Canada’s largest Credit Union. But those
impressive numbers are never our sole focus, to be sure. No, our focus is
always on what we believe. And what we believe in is you.
Since 1946, we’ve known that members make us who we are.
In the last six-and-a-half decades, we’ve grown to become Canada’s largest
Credit Union, with almost 60 locations province-wide serving over 400,000
members.
But at Vancity, these members aren’t just the people we serve. These members
are the people at the helm. They guide us, as a co-op, on our journey. And they
do this in any number of ways -– specifically by electing members to sit on our
Board of Directors or by becoming Directors themselves.
At the end of the day, it comes down to full transparency – something 2/3 of
our members agree is of paramount importance. As such, our accountability
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reports have become an integral part of the lifeblood of our organization.
Keeping members abreast of economic, social, and financial decisions and
actions made along the way.
It’s really a bit chicken-and-egg, actually. Do our members choose us because
our vision matches theirs? Or do they choose us because our vision is actually
shaped by theirs?
Because, like we said, without you there would be no “us”. And it’s just as easy
as that.
What is governance? A simple model of governance requires rules and policies
to be put in place to ensure that the members interests are safeguarded through
effective financial and risk management. Vancity believes that good governance
goes beyond this simple model: Good governance is ensuring that the
organization is run in a socially, environmentally and economically responsible
way that is aligned with the interests of our members, employees and other
stakeholders, including our local communities.
The Board of Directors with the Executive Leadership Team set the strategic
direction and oversee the Credit Union. Our members elect the Board and are
the first step in setting our governance.
Since the Board is voted in by our Members, the Directors are 100%
independent of management. Read more on our individual directors.
How do we stay Main Street and not become Wall Street?
With
leadership in action.
The Board of Directors is responsible under law for the management of
Vancity’s business and its affairs. It has the statutory authority and obligation to
protect the assets of Vancity in the interest of all members. Although Directors
are elected by the members to bring special expertise or a point of view to
Board deliberations, the best interests of Vancity must be paramount at all
times. In other words, the Vancity Board of Directors is here to represent and
serve all our members. It’s this kind of thinking that has led Vancity since 1946
to be the first financial institution to lead the way in changing how our
community is served.
Read more on our current board, directors election, director responsibility,
director development and remuneration.
Using the framework of our Statement of Values and Commitments and
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governance policies, the Board has the following principle duties:
•
•
•
•
•
To ensure that our strategic planning is aligned to our Values
To appoint, oversee and monitor senior management
To oversee enterprise risk management
To ensure effective communication with members and other stakeholders
To ensure the integrity of financial and non-financial reporting and system of
internal controls
To ensure effective governance practices
Triple the bottom lines. Triple the commitment.
Our triple bottom line business model is driven not only by a commitment to
financial success, but to environmental and social sustainability as well.
As we grow and change, there is one thing that will never change — our values.
• Our Statement of Values and Commitments isn't new—it's how we've always
done business. We put it in writing to guide our business decisions and
ensure we stay true to the values that have made us strong.
• We are committed to the Co-operative Principles of the International Cooperative Alliance.
• We've made corporate social responsibility an integral part of our business
planning process, targets and action plans. It defines how we live our
values in the way we do business.
• Every day, we refer to our Ethical Policy to make decisions on current and
future business relationships, including suppliers, business members, and
sponsorship and grant recipients.
• We strive to create a workplace where all employees are treated with dignity
and respect. Our Code of Conduct assists Vancity employees in
maintaining the highest standards of ethical conduct.
• Our Commitment to Diversity reflects our commitment to maintaining a
positive, welcoming work environment in which our individual
differences are valued.
• What will the future of socially responsible investing hold for investors,
managers, advocates and the sector overall?
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The Vancity Story was written by our employees to showcase what makes
Vancity unique. For us, corporate social responsibility (CSR) goes beyond donating money or
volunteering time to worthy causes. It’s about operating in a way that is
responsible to our members and our staff, that is respectful of the environment
and that is supportive of the communities in which we live and work.
In striving to be a leader in CSR we:
• Offer business products that are socially and environmentally responsible.
• Invest in the well-being of the communities we serve through grants,
scholarships, awards, fundraising and community service.
• Adopt business practices that are socially and environmentally responsible.
• Advocate for social and environmental responsibility with the aim of making
a positive difference to the individuals and communities around us.
In striving to be a leader in corporate social responsibility, we have developed
business practices, products and services that serve our members well while
contributing to the social and environmental well-being of local communities.
We have made corporate social responsibility an integral part of our business
planning process and our targets and action plans.
Our Green Products
We offer green products that support activities that reduce energy consumption
and use cleaner energy. Now it’s easier for you to choose green and save money
too.
enviro Visa* donates at least 5% of Visa profits to local environmental
projects. Plus, each time you make a purchase, you get reward points that can
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be redeemed for travel, merchandise, financial products or donations to
charities.
Green Business Program helps business and not-for-profit members make big
or small changes to their operations that positively impact the environment and
save them money.
Bright Ideas Home Financing rewards you for making your home
environmentally efficient. We support your choice to make your home more
energy-efficient by offering no-nonsense, renovation financing. Bright Ideas
will help you produce fewer greenhouse gas emissions while cutting your
energy costs by about 35%.
Clean Air Auto Loan saves you money when you buy a vehicle with low CO2
emissions. We reward members who choose to buy fuel-efficient cars that emit
less carbon into the atmosphere with preferential loan rates. With no loan
maximum and no prepayment penalties, it’s an easy way to choose green.
IAC Inhance SRI Funds. Through our strategic alliance with IA Clarington
Investments (IAC) we help you invest in companies that use progressive, social,
environmental and corporate governance practices in managing their business.
This allows you to choose from a wide array of responsible investments so you
can choose a greener way to get returns.
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Shared Success gives 30% of our net profits back to members and their
communities every year. Shared Success helps a variety of local organizations
that improve social, economic and environmental conditions.
Shared Growth Term Deposits invests your money in projects that improve
the social and environmental well-being of local communities while you earn a
guaranteed, competitive interest rate.
Development Finance Institutions
http://en.wikipedia.org/wiki/Development_Finance_Institution
(DFI) is generic term used to refer to a range of alternative financial institutions
including microfinance institutions, community development financial
institution and revolving loan funds.[1] These institutions provide a crucial role
in providing credit in the form of higher risk loans, equity positions and risk
guarantee instruments to private sector investments in developing countries[2].
DFIs are backed by states with developed economies. In 2005, total
commitments (as loans, equity, guarantees and debt securities) of the major
regional, multilateral and bilateral DFIs totalled US$45 billion (US$21.3 billion
of which went to support the private sector)[2].
DFIs have a general mandate to provide finance to the private sector for
investments that promote development[2]. The purpose of DFIs is to ensure
investment in areas where otherwise, the market fails to invest sufficiently[2].
DFIs aim to be catalysts, helping companies implement investment plans and
especially seek to engage in countries where there is restricted access to
domestic and foreign capital markets and provide risk mitigation that enables
investors to proceed with plans they might otherwise abandon[2]. DFIs
specialise in loans with longer maturities and other financial products. DFIs
have a unique advantage in providing finance that is related to the design and
implementation of reforms and capacity-building programmes adopted by
governments[2].
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DFIs' mandate requires them to invest in areas commercial banks do not,
towards poorer countries and sectors and as hence they face higher risks[2].
DFIs must help markets grow and seek to improve the investment climate, in
order to demonstrate that enterprises can develop in economically challenging
markets, thus contributing to sustainable development[2]. However, since
private capital must also be involved and their continued investment in future
projects ensured, a commercial return must be achieved[2]. Yet DFIs seek to
resolve these two conflicting factor through an 'optimum' level of risk by
balancing the cost of managing elevated levels of risk (e.g. loss provisions on
loans, guarantees and equity impairment revaluations etc.), with the need to
maintain liquidity sufficient to ensure strong institutional credit ratings, a low
cost of borrowing, and generate a surplus to support technical assistance and
grants[2].
Community development financial institutions
http://en.wikipedia.org/wiki/Community_development_financial_institution
In 2006, there were approximately 1250 CDFIs, consisting of:[2]
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More than 500 community development loan funds;
More than 350 community development banks;
More than 290 community development credit unions;
More than 80 community development venture capital funds.
In May 2010, the CDFI Fund had certified 862 CDFIs[3], 57 Native CDFIs
(serving Native Americans)[4], and 4,230 CDEs[5], each of which may have
multiple subsidiary investment funds.
Nationwide, over 1000 CDFIs serve economically distressed communities by
providing credit, capital and financial services that are often unavailable from
mainstream financial institutions. CDFIs have loaned and invested over billions
in our nation’s most distressed communities. Even better, their loans and
investments have leveraged billions more dollars from the private sector for
development activities in low wealth communities across the nation.
While there are numerous organizations certified as CDFIs by the CDFI Fund,
it is believed that there are thousands of financial institutions serving the needs
of low-income people or communities in the U.S., but either have not applied
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for CDFI status or have otherwise not been able to fulfill all of the
requirements for formal CDFI certification.
(On August 20, 2010, the Shore bank was declared insolvent, closed by
regulators and most its assets were acquired by Urban Partnership Bank
https://www.upbnk.com/personal) - ShoreBank, headquartered in the South
Shore neighborhood of Chicago, was founded in 1973. It was the largest CDFI,
with over $2 billion in assets.[3] ShoreBank had branches in Chicago’s South
and West sides, Cleveland, and Detroit, but in August 2010 the bank was
declared insolvent and its branches were taken over by Urban Partnership
Bank. Its holding company ShoreBank Corporation, still exists and promotes
its community development mission through affiliates in Oregon and
Washington state, and in Michigan’s Upper Peninsula. ShoreBank’s
international consulting services have offices in Chicago, Washington, D.C.,
and London, and projects in 30 countries around the world.
OneUnited Bank, headquartered in Boston, MA is the largest AfricanAmerican owned CDFI in the country and focuses on serving and developing
urban communities. The Bank has achieved consistent profitable growth
through both bank acquisitions of similar mission driven banks and organic
loan and deposit growth. The Bank has provided innovative products and
services to fulfill its community development mission in the urban
communities of Boston, Massachusetts, Miami, Florida and Los Angeles,
California. OneUnited Bank continues to be integrated into the social and
economic fabric of each of these communities in every respect from not-forprofits, small business, affordable housing, churches, etc.
The Center for Community Self-Help, another leading CDFI, was founded in
1980 in Durham, North Carolina. Self-Help's home and business lending has
provided low-wealth, minority, rural and female borrowers with over $5.24
billion in financing.[4] Much of this is through Self-Help's national secondary
market program, which enables conventional lenders to make more home loans
to low-wealth families. Self-Help also develops commercial and residential real
estate and operates retail credit unions. In response to predatory lenders
increasingly targeting family wealth in poor and minority communities, SelfHelp in 1999 worked with the NAACP, AARP and other North Carolina
groups to form the Coalition for Responsible Lending and help enact one of
the US's first laws to curb predatory mortgage lending.[5] In 2002, Self-Help
founded the Center for Responsible Lending, a nonprofit, nonpartisan research
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and policy organization that recommends solutions to predatory lending
abuses.[6]
Association for Enterprise Opportunity
http://www.aeoworks.org/index.php/site/page/category/what_we_do/AEO
is a national membership organization and voice of microenterprise
development in the United States. For nearly two decades, AEO and its
hundreds of member organizations have helped more than two million
entrepreneurs support themselves and their families and contribute to their
communities through business ownership. AEO’s strives to foster greater
understanding of the importance of strong and effective microenterprise
initiatives to the U.S. economy, and to increase capacity of the field to support
underserved entrepreneurs in starting, stabilizing and establishing businesses.
AEO represents the public policy interests of its members and, through its
growing network of partners, facilitates interactions among small entrepreneurs
and the organizations that seek to help them succeed.
Mission: AEO supports the development of strong and effective U.S.
microenterprise initiatives to assist underserved entrepreneurs in starting,
stabilizing, and expanding businesses.
Vision: Every individual in the U.S. has access to resources and services for
creating wealth, assets and healthy communities. AEO envisions a vibrant
microenterprise sector served by a broad range of institutions and sustainable
providers of business development and support services—all members and
partners of AEO.
AEO’s strategy includes 3 pillars:
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Strengthen and restructure the microenterprise field to serve as a robust
source of sustainable products and services to an increasing number of
disadvantaged and underserved entrepreneurs.
Link the needs of a growing microenterprise sector to an ecosystem of
market partners for greater economic impact.
Catalyze new solutions and the rapid adoption of standards and
innovation by microenterprise development organizations to drive
transformation in the field.
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Impact
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AEO members have helped more than two million entrepreneurs create
jobs for themselves and their communities.
AEO has secured more than $300 million federal dollars for
microfinance industry participants since 2001 through its policy
advocacy efforts.
Through AEO managed programs, member organizations have received
around $20 million dollars of private funding to improve and expand
vital programs and services to disadvantaged entrepreneurs and
communities, while entrepreneurs have received $1.4 million dollars in
technology and equity awards.
AEO gratefully acknowledges the following foundations and corporations
for their generous contributions. Their financial support and commitment
to AEO’s mission gives us the means and inspiration to make our work
possible.
Bank of America
Capital One
Citibank
Citi Foundation
The Friedman Family Foundation
The W.K. Kellogg Foundation
The Charles Stewart Mott Foundation
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The Ms. Foundation for Women
UPS
US Bank
CDFA Community Development Finance Association
Community Development Finance Institutions (CDFIs) lend money to
businesses, social enterprises and individuals who struggle to get finance from
high street banks and loan companies. They help deprived communities by
offering loans and support at an affordable rate to people who cannot access
credit elsewhere.
Who do CDFIs help?
Most CDFIs are based within the UK’s most disadvantaged communities. They
provide loans and support to:
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
Microenterprises (businesses with less than 10 employees)
Small businesses (with 10-49 employees)
Medium businesses (with 50-249 employees)
Social enterprises, community organizations or charities
Individuals
CDFIs can serve one or several of these markets, but often they specialize in
just one. Most lending by CDFIs is to microenterprises and social enterprises.
CDFIs traditionally provide loans to people who face barriers to accessing
finance. For example, they may lend to individuals with a poor credit history or
little collateral, or provide business loans to entrepreneurs with little business
experience.
What do CDFIs finance?
CDFIs provide finance for a wide range of purposes, although these will vary
according to each individual CDFI. They include:
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Working capital
Bridging loans
Property and equipment purchase
Start up capital
Business purchase
Personal loans
Home improvements*
Back to work loans
How is a CDFI different from a normal bank or loan company?
CDFIs are small, independent organizations, not part of multinational
companies like the banks. CDFIs’ primary mission is not to make a private
profit, but to support communities by providing affordable finance that would
otherwise not be available. They recycle this finance again and again into
communities. Many CDFIs are run with funding from the Government and
charitable trusts, alongside other funding sources.
Most CDFIs do not take savings or deposits like banks do. And because they
are much smaller than banks, they can spend more time talking to customers
about their needs and finding the right loan for them. Some CDFIs offer
business support and financial advice in addition to loans.
Personal-lending CDFIs offer an affordable alternative to high interest
doorstep lenders. They keep their fees as low as possible and help customers to
manage and repay their debts, unlike doorstep lenders which charge sky-high
APR-rates and trap customers in spirals of debt.
How are CDFIs funded?
There are many different sizes and types of CDFI, and they are funded in
different ways.
All CDFIs use the income from lending activity for their running costs and to
make more loans.
Current Funding Opportunties
Barclays Community Finance Fund
European Regional Development Fund
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CDFI wholesale lending through Unity Trust Bank
Esmee Fairbairn grants
They combine this with funding from a range of additional sources. Many are
part-funded by Government departments and agencies. For example, a number
of business-lending CDFIs in England have funding from the Regional
Development Agencies, while many personal-lending CDFIs have funding
from the Department for Work and Pensions Growth Fund.
Other funding sources include European grants, donations from charitable
trusts, social investments, and grants and loans from high street banks.
The Change Matters performance framework acts as a health check service for
our members, and it is currently provided to them fully subsidised by cdfa.
Through a programme of site visits, our trained external assessors give
members a thorough analysis of their performance with the aim of driving up
standards across the sector.The overall aim is to enable CDFIs to improve their
own efficiency, transparency and impact which will in turn increase the
potential to attract investment from a range of stakeholders.
The CDFI Coalition
http://www.cdfi.org
The CDFI Coalition is the unified national voice of community development
financial institutions (CDFIs). Our mission is to encourage fair access to
financial resources for America's underserved people and communities.
Nationwide, over 1000 CDFIs serve economically distressed communities by
providing credit, capital and financial services that are often unavailable from
mainstream financial institutions. CDFIs have loaned and invested over billions
in our nation’s most distressed communities. Even better, their loans and
investments have leveraged billions more dollars from the private sector for
development activities in low wealth communities across the nation.
The CDFI Coalition advocates on behalf of the CDFI industry and educates
the public about community development finance. The CDFI Coalition is a
primary source of information and knowledge about the CDFI field for the
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general public, the media, public officials, private sector lenders, as well as
CDFIs.
Governance
The Fund is housed in the U.S. Treasury Department and its Director is a
Presidential appointee. A 15-member advisory board is comprised of six
government representatives: the Secretaries of Agriculture, Commerce, HUD,
Interior, and Treasury as well as the SBA Administrator; and nine private
citizens: two CDFI representatives, two representatives from insured
depositories, two national public interest representatives, two community
development specialists, and one Native American community development
representative.
Community Development Bankers Association
http://www.cdbanks.org/
CDBA is the national trade association of the Community Development
Banking sector. We are the national voice of community development banks
and thrifts that are certified as community development financial institutions
(CDFIs). We strive to educate policy-makers, regulators, legislators and the
general public on the importance of Community Development Banks,
the unique circumstances under which they operate and the special needs our
institutions have.
A Community Development Bank (CDB) is a Federal Deposit Insurance
Corporation-insured bank or thrift that has a primary mission of promoting
community development. Often referred to as CDFI Banks, these institutions
are distinct from traditional banks and thrifts because they primarily target low
and moderate income markets. Most traditional banks do not focus on
specifically serving these areas. Our member banks and other CDBs work
in urban and rural communities that lack access to credit and are not adequately
served by the traditional banking industry.
Sponsors
Using Promontory Interfinancial Network's CDARS® and IND® services,
financial institutions can build multi-million-dollar relationships, manage
liquidity by selling excess deposits for fee income, and tap cost-effective fixedor floating-rate funding (available without collateralization or stock purchase
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requirements). Promontory has established the nationwide Promontory
Network, comprised of more than 3,000 financial institutions, through which
members place billions of dollars in deposits every week. As a service to the
banking industry, Promontory also offers Prepaid Assessment
MarketplaceSM, a free service that helps depository institutions buy or sell
prepaid FDIC assessments. To learn more, please visit
www.promnetwork.com.
Waveland Ventures, LLC provides capital and structured financial solutions to
operating companies and owners/developers of commercial real estate.
Waveland currently manages approximately $500 million in venture capital and
leveraged debt investments. Our investment philosophy is predicated on the
belief that significant secular trends have converged to create compelling
investment opportunity in what are commonly referred to as
Emerging Domestic Markets ("EDMs"). EDM's can be defined as people,
geographic areas, or enterprises that face constraints in accessing traditional
sources of debt and equity capital, and include: small and medium sized
businesses; early and seed stage operating businesses; businesses and real estate
located in low and moderate income census tracts; ethnic and/or minority
owned businesses.
You can support the important work that CDBs do in your local community or
in communities around the nation. Community Development Banks need
socially motivated investors willing to place their money in the form of deposits
to provide capital to make new loans. You can help by placing your money as a
fully insured deposit in a CDBA member. Scroll down to read more about our
Banking on Communities Initative.
Community Development Venture Capital Alliance
http://www.cdvca.org/
The Community Development Venture Capital Alliance (CDVCA) is the
network for the rapidly growing field of community development venture
capital (CDVC) investing. CDVC funds provide equity capital to businesses
in underinvested markets, seeking market-rate financial returns, as well as
the creation of good jobs, wealth, and entrepreneurial capacity.
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CDVCA promotes the field by combining advocacy, education,
communications, and best-practice dissemination through conferences
and workshops. CDVCA makes its expertise available to CDVC funds by
providing consulting services and technical assistance.
CDVCA also manages its own investment vehicle, the Central Fund. The Fund
specializes in identifying areas with untapped market potential, investing in
rapidly growing businesses across diverse industries.
CDVCA was formed in 1993 and incorporated as a not-for-profit in 1995,
CDVCA promotes use of the tools of venture capital to create jobs,
entrepreneurial capacity and wealth to advance the livelihoods of low-income
people and the economies of distressed communities.
The organization began when representatives of several community
development venture capital funds met to discuss issues of common concern
and share experiences and solutions to common problems. Realizing that they
had been "reinventing the wheel" in different corners of the country, these
funds established a regular forum in which they could exchange ideas. Since
then, CDVCA has grown rapidly, now with approximately 100 members,
bringing together practitioners at all levels of experience and providing
opportunities for them to learn, explore best practices, and gain resources for
their work.
CDVCA is working on many fronts to build, strengthen, and support the
community development venture capital (CDVC) field. CDVCA promotes the
field by combining advocacy, education, communications, and best-practice
dissemination through conferences and workshops. CDVCA makes its
expertise available to CDVC funds by providing consulting services and
technical assistance. Click here for more information about CDVCA's program
areas.
Our Mission
The Community Development Venture Capital Alliance (CDVCA) is the
network for the rapidly growing field of community development venture
capital (CDVC) investing. CDVC funds provide equity capital to businesses
in underinvested markets, seeking market-rate financial returns, as well as
the creation of good jobs, wealth, and entrepreneurial capacity.
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The CDVCA Central Fund currently has almost $6 million under management
and is actively seeking investment opportunities to put those funds to work in a
meaningful way in the community development venture capital industry. The
Fund is available to make two types of investments: Fund of Funds
investments and Co-investment Fund investments.
Fund of Funds investments are made in CDVCA member funds that have
missions of creating high-quality jobs and wealth that improve the lives of lowincome people and benefit distressed communities. Co-investment Fund
investments, as direct equity investments made with other funds, are made in
companies that meet CDVCA's financial and social criteria and will be made in
any industry sector except real estate.
The investments lead to creation of substantial job opportunities for lowincome people.The portfolio of the Fund is managed so that more than half of
the jobs created go to people who had low-incomes (less than 80% of area
median) before they took the jobs. The Fund also seeks other social returns,
such as encouraging minority and women ownership, environmentally
sustainable businesses, production of products useful to communities, and
promotion of socially responsible business practices.
National Federation of Community Development Credit
Unions
A community development credit union (CDCU) is a credit union with a special mission of
serving low- and moderate-income people and communities.
More than sixty years ago, a small number of credit unions were founded with
the specific mission of serving low-income and minority communities beyond
the reach of banks and mainstream credit unions. These “community
development credit unions” (CDCUs) specialize in serving populations
generally considered the hardest to serve, including low-income wage earners,
recent immigrants, and people with disabilities.
Policy Members - Credit unions with a primary mission of serving low-income
people & communities.
Current membership: 235 CDCUs
Aggregate Statistics of Policy Member CDCUs*:
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Assets: over $10.7 billion
Credit union members: more than 1.6 million
Median size: $3.8 million in assets and 1,597 members
Median age: 40 years
To search our member CDCUs by state, please click here.
*As of June 2010.
Community Development Partners - Credit unions that do not have a primary
mission of serving low-income people & communities, but have shown a
commitment to serving people of modest means or want to do more to serve
the underserved.
Current Membership: 50 Community Development Partners
Aggregate Statistics of Community Development Partners:
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Total Assets: over $120.89 billion
Credit union members: more than 10.16 million
Median size: $586.9 million in assets and 56,429 members
Since 1982, The Federation's "Capitalization Program for CDCUs" has helped
credit unions strengthen their finances and expand their impact on low-income
communities. CDCUs - like all credit unions - raise deposits which they relend
to their members. But in low-income communities, raising deposits from
people with little disposable income is a major challenge. Congress recognized
this in 1970, when it gave low-income credit unions the exclusive right to raise
deposits from "non-members" -- organizations and individuals outside the
primary field-of-membership of these credit unions. To help CDCUs gather
these funds, the Federation launched the Capitalization Program.
25th Anniversary Capital Campaign - In 2007, the Capitalization Program
celebrated its 25th anniversary. Marking this important milestone, the
Federation launched a capital campaign to raise an additional $25 million to
invest in CDCUs across the country. As part of this campaign, the program
focus has been redirected to bring maximum impact to our members, and
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rebranded itself as the Community Development Investment Program. Learn
more about our 25th Anniversary Capital Campaign by clicking here.
Over the past 25 years, many foundations, banks, religious organizations, and
other institutions have invested in local CDCUs through this program. The
Ford Foundation, John D. and Catherine T. MacArthur Foundation,
Mennonite Mutual Aid, Bank One, JPMorgan Chase, Bank of America, and the
federal CDFI Fund are just a few of our investors.
Today, the Federation has more than $50 million in assets under management,
with 80% deployment of our investments in more than 120 different CDCUs.
We have become a virtual "one-stop-shop" for credit unions seeking funds to
expand their activities: we provide not only deposits, but loans (secondary
capital) and grants.
An investment in the Federation is a social investment in grassroots,
cooperatively-owned and locally-controlled nonprofit institutions, focused on
serving low- and moderate-income communities across nation. For investors
looking for targetted impact, there is no better way to reach the world of
CDCUs than through the Federation's Community Development
Investment Program.
National Community Investment Fund
http://www.ncif.org/
The National Community Investment Fund is a non-profit, private equity trust
that invests in banks, thrifts and credit unions that generate both financial and
social returns. These Community Development Banking Institutions
(CDBIs) — a term used by NCIF to describe depository institutions with a
community development focus - may be located in urban, rural or Native
American markets, and may be minority-owned, minority-focused or majority
owned. However, to be considered a CDBI, an institution must focus a
substantial part of its business on low- to moderate-income people or
communities.
Mission Statement
The National Community Investment Fund (NCIF) invests private capital in,
and facilitates knowledge transfer to, depository institutions that increase access
to financial services in underserved communities.
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NCIF fulfills its mission through two primary business lines; "Equities with
Exits" Investments and the CDBI Exchange Network.
"Equities with Exits" Investments
NCIF purchases common stock in individual community development banks
and thrifts as a patient investor. These institutions need to demonstrate
sustainable, sound financial performance, a strong development impact in the
communities they serve (for more information,see Model CDBI Framework
under the Investing page), and they should expect to provide share-holder
liquidity within a reasonable time frame. Additionally, NCIF selectively makes
seed fund loans, extends debt to banks and provides secondary capital to lowincome credit unions. NCIF has $68 million in New Markets Tax Credits
allocations.
During 2007, NCIF created metrics using publicly available data (available from
the Home Mortgage Disclosure Act, the Federal Deposit Insurance
Corporation and the 2000 Census) that act as a positive screen for identifying
new CDBIs. Using these metrics, NCIF will help increase the flow of deposits
(and in the future, debt and equity) to the CDBI sector.
CDBI Exchange Network
This informal peer-to-peer network of CEOs, CFOs and other interested
participants in the Community Development Banking Institution (CDBI)
industry provides best practices in risk management, valuation, corporate
governance and development impact analysis. NCIF’s Annual Development
Banking Conference is the centerpiece of our knowledge transfer initiatives.
NCIF Investments by the Numbers
Community Development Impact
Since NCIF began tracking the activities of its portfolio institutions in 1998,
these institutions have generated over $3.7 billion in development lending. This
represents over 83,000 loans that were directed toward low-income borrowers
and low to moderate-income communities.
Total Investment
Since its inception in 1996, NCIF has invested over $24 million in 37 financial
institutions nationwide.
Diverse Investments
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By dollar amount, 73% of all investments made have been placed in minorityowned or focused institutions and/or woman-owned or managed institutions.
Rural Institutions
By dollar amount, 18.9% of all investments made by NCIF have been placed in
rural institutions.
De Novo Banks
NCIF has invested seed capital in six de novo banks.
Investors & Funders
NCIF was created when Bank of America (then NationsBank) entered into a fund
advisory relationship with ShoreBank Corporation and invested $15 million for NCIF to
invest in community development banking institutions throughout the country. Bank of
America continues to be the largest investor in NCIF. Over the years, additional banks and
funders have supported the NCIF mission. A full list of investors and funders is given
below
NCIF's investors include:
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Bank of America
MBNA America Bank (now Bank of America)
Washington Mutual Bank (now JPMorgan Chase)
The John D. and Catherine T. MacArthur Foundation
The Ford Foundation
Fannie Mae
The F. B. Heron Foundation
Jewish FundS for Justice
National Credit Union Foundation
Opportunity Finance Network
http://www.opportunityfinance.net/about/about.aspx
Finding and financing opportunities that others miss.™
Opportunity Finance Network is the leading network of private financial
intermediaries identifying and investing in opportunities to benefit low-income
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and low-wealth people in the U.S. Our financing delivers both sound financial
returns and real changes for people and communities.
Opportunity Finance Network originated more than $23.5 billion in financing
in non-conforming urban, rural, and Native communities through 2008. This
has generated or maintained 229,687 jobs; 51,409 businesses and
microenterprises; 630,882 housing units; and, 6,022 community facility projects.
With cumulative net charge-off rates of less than 1.2%, we have demonstrated
our ability to lend prudently and productively in unconventional markets often
overlooked by conventional financial institutions.
Vision & Mission
Our vision is a world where all people experience social, economic, and
political justice and so have the opportunity to act in the best interests of their
communities, themselves, and future generations. Our mission is to lead the
opportunity finance system to scale through capital formation, policy, and
capacity development.
Vision
Opportunity Finance Network’s vision is a world where all people experience
social, economic, and political justice and so have the opportunity and ability to
act in the best interests of their communities, themselves, and future
generations.
Mission
Opportunity Finance Network’s mission is to lead the opportunity finance
system to scale through capital formation, policy, and capacity development.
We expect to achieve this by 2010.
Core Purpose
Our core purpose is to align capital with social, economic, and political justice.
That is the reason Opportunity Finance Network exists.
Core Values
Two core values anchor our work. We will work by these values without regard
to circumstantial or environment changes.

Justice
Every facet of our work should be directed toward and reflect an
unwavering commitment to fair and equal access to, opportunity in, and
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responsibility for social, economic, and political life. For us, justice is a
unifying value.
Excellence
The people and communities we serve have a right to expect excellence,
and we have a responsibility to provide it. A commitment to excellence
is a statement of respect for our customers, investors, funders, staff,
Board, and Members.
Core Lines of Business
We work in three areas – financing, knowledge sharing, and policy. Our core
lines of business have proven records of success. We serve Members, donors,
investors, policy makers, and customers. We help capital flow to opportunity
markets – the people and communities that are outside the economic
mainstream today. And we help opportunities flow to capital markets.
Financing
To transform community development finance into a high-volume financing
system we finance CDFIs (community development financial institutions)
directly with an eye toward identifying and financing the systems that alter how
the CDFI industry works – enabling scale and productivity through changes
involving hundreds of CDFIs. Our Financing includes our core Financing
Fund for CDFIs and Managed Assets for institutional investors in CDFIs.
The CDFI Assessment and Ratings System™ (CARS™), the only rating system
of its kind for CDFI investors, is also part of our financial services. CARS™ is
a comprehensive, third-party analysis of community development financial
institutions that aids investors and donors in their investment decision making.
CARS™ will increase the flow of capital and ensure that CDFI performance is
the primary criterion for determining the flow of capital through these
institutions.
Knowledge Sharing
Knowledge Sharing delivers knowledge sharing services, including our Annual
Conference (the premier opportunity finance industry event attracting more
than 700 attendees); regional meetings; consulting services; publications;
informal technical assistance; and Member Staying Connected conference calls.
Policy
Our Policy division is actively engaged in the core issues and programs that
advance economic development resources for CDFIs at the federal level. We
are also leading the discussion to bring together leaders from a variety of
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industries to develop a bi-partisan policy strategy regarding access to capital to
create wealth and economic opportunities.
Opportunity Finance Network
We are proud of our Network’s record of success:
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More than 170 Members strong
$23.5 billion invested through FY 2008, financing:
o 51,409 businesses
o 630,882 housing units
o 6,022 community facility projects
o and, generating or maintaining 229,687 jobs
$9.0 billion in total assets
Low-risk, with a net charge-off rate of 0.9% in FY 2008
At work in urban, rural, and Native communities in all 50 states
Strategic Plan
Aligning Capital With Social, Economic & Political Justice: National
Community Capital’s Strategic Plan 2004-2010* was developed in response
to structural and systemic changes in our external operating environment and
within and among the opportunity finance industry. We needed to understand
how opportunity finance is likely to change over the next seven-ten years and
what role we should play.
We set six strategic goals Opportunity Finance Network expects to achieve by
2010. Of the six, two are systemic – that is, they are transformational changes
of the opportunity finance system – and four are organizational, they pertain
directly to Opportunity Finance Network.
SYSTEMIC GOALS
ORGANIZATIONAL GOALS
If we are going to align capital with social, economic, and political
justice by leading the community development finance system to scale through
capital formation, policy, and capacity development, by 2010 we will need to
achieve—alone or preferably in partnership with others—the
following systemic and organizational goals:
A high-volume financing system providing tens of billions of dollars
annually benefiting millions of low-income and low-wealth people and
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communities with a wide array of affordable, customized products that create
economic opportunities, build wealth, and strengthen communities. This goal is
the central, lead goal in NCCA’s strategic plan.
Government policies that benefit low-income and low-wealth people
and communities by stimulating billions of dollars annually of new private
investment by pension funds and other retirement accounts, mutual funds,
individual investors, banks, and non-bank financial service companies in
underserved markets. Anti-poverty and economic inclusion policies are integral
to economic as well as social policy.
Broad understanding of, agreement with, and support for NCCA’s core
purpose and mission among a critical mass of community development
finance professionals, conventional finance professionals, policy makers, and
the people and communities we serve. The community development finance
system must do much more than it has so far to organize people and
organizations in support of community development finance if we are to
achieve success at scale.
Binding ties to the 7-10 most powerful organizations
fighting for social, economic, and political justice. Community development
finance needs to demonstrate in clear and visible ways its historically implicit
commitment to justice
Scores of mainstream champions (on Wall Street, in banks, and in
government) fighting for NCCA’s core purpose. Community development
finance serves the economy and policy well; we must make the connection
tangible and easily recognizable.
Consistently strong NCCA financial performance that increases our ability
to execute our plan year after year. To succeed, NCCA must align its resources
with its strategies.
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II. Small Business
- Quantify the efficiency & effectiveness of job creation as compared
to large companies
- Capital:
o Why is it so hard to access capital?
o What programs currently serve small business?
 Quantify the programs in terms of businesses served and
dollars loaned
 What are the strengths and weaknesses of those programs
o Quantify the investment risks for:
 Start-ups
 Going concerns
o What are the primary reasons that small start-ups fail?
o What are the primary reasons that small going concerns fail?
o What would most effectively mitigate against these risks?
o How do the terms of loans and interest rates compare to the
terms upon which large companies access capital?
o Where does start-up capital most come from?
o How does this vary for Co-Ops & ESOP’s
CSR Press Release
http://www.csrwire.com/press_releases/30725-First-of-its-Kind-LawGives-Bid-Advantages-to-Sustainable-Small-Business
First of its Kind Law Gives Bid Advantages to Sustainable Small
Business
CLEVELAND, Sep. 29 /CSRwire/ - The City of Cleveland has enacted the
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first law in the U.S. providing advantages for sustainable companies bidding on
City contracts. Cleveland's 'buy local and sustainable law' puts sustainable
companies' bid advantages on par with those given to minority (MBE) and
female business enterprises (FBE). Certified MBEs and FBEs can add
Cleveland's local and sustainable bid advantage to their existing bonuses. The
City of Cleveland spends upwards of a billion dollars a year on the purchase of
goods and services and through this law provides a model for cities across the
U.S. to encourage triple bottom line sustainability among small businesses.
BALLE
The Business Alliance for Local Living Economies, or BALLE, is North
America's fastest growing network of socially responsible businesses,
comprised of over 80 community networks in 30 U.S. states and Canadian
provinces representing over 22,000 independent business members across the
U.S. and Canada.
BALLE believes that local, independent businesses are among our most potent
change agents, uniquely prepared to take on the challenges of the twenty-first
century with an agility, sense of place, and relationship-based approach others
lack. They are more than employers and profit-makers; they are neighbors,
community builders and the starting point for social innovation, aligning
commerce with the common good and bringing transparency, accountability,
and a caring human face to the marketplace.
BALLE believes in the power of bottom-up, networked change. In the age of
the Internet and social networking and the emergence of “glocalism” as a new
form of social consciousness, we believe that never before have communities
possessed as much power to determine their futures as they do today and in
ways that are good for people, places and the planet.
By catalyzing and connecting local business networks dedicated to Living
Economy principles, we are movement builders, growing an ever-expanding
constituency for sustainable businesses and sustainable communities, from
Main Street to the world.
By strengthening these networks, we are field leaders, deepening our
understanding of community economic development frameworks and practices
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while experimenting with innovations aimed at building thriving local
economies.
http://www.livingeconomies.org/netview/what-is-a-balle-network
Transition Towns
http://www.transitionus.org/about-us
Transition US is a nonprofit organization that provides inspiration,
encouragement, support, networking, and training for Transition Initiatives
across the United States. We are working in close partnership with the
Transition Network, a UK based organization that supports the international
Transition Movement as a whole.
The Transition Movement is a vibrant, grassroots movement that seeks to build
community resilience in the face of such challenges as peak oil, climate change
and the economic crisis. It represents one of the most promising ways of
engaging people in strengthening their communities against the effects of these
challenges, resulting in a life that is more abundant, fulfilling, equitable and
socially connected.
We believe that we can make the transition to a more sustainable world. We
hope that you will join us.
Sustainable Communities Online
http://www.sustainable.org/about
Sustainable Communities Online is the newly revised, updated, and redesigned
website formerly known as the Sustainable Communities Network (SCN)
website which was developed by a broad coalition of organizations around the
United States in the mid-1990s. The intent of the SCN was to pool information
on sustainability to make it more readily accessible to the public. CONCERN,
Inc. and the Community Sustainability Resource Institute managed the SCN
from 1993–2001 and CONCERN has managed it since then.
The Charleston Green Business Challenge
http://www.sustainable.org/economy/small-business/1076-the-charleston-
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green-business-challenge
The Green Business Challenge is a voluntary opportunity for businesses of all
types and sizes to pursue green and sustainability driven strategies, and improve
their business performance and enhance their bottom line. The Green Business
Challenge was developed by the City of Chicago and is now being piloted by
five cities across the nation through the initiative of ICLEI—Local
Governments for Sustainability. Key elements of the Challenge are reductions
in waste, water and energy use, as well as creating a healthy work environment
and community stewardship. In Chicago, this program saved fifty participating
businesses over $5 million and created almost a 9% savings in energy usage, in
just a year.
The Sustainability Institute has partnered with the City of Charleston,
Lowcountry Local First, the Green Fair, the Charleston Metro Chamber of
Commerce and Charleston County to launch the Charleston Green Business
Challenge and give local businesses the opportunity to achieve green successes
and be recognized for their efforts. The institute is offering its expertise in
training and education to help participating businesses stay on track during the
twelve months of the Challenge and provide direction on ways to achieve the
goals laid out in the program’s Scorecard.
Independent Business Alliance®
http://amiba.net/about_ibas.html
What is a Local Independent Business?
•
•
•
•
Private, cooperative, employee, or community ownership
At least 50% owned by area resident(s)
Full decision-making authority lies with its local owner(s) or members
Limited number of locations, all within a within a single state or region
(determined by local groups)
An Independent Business Alliance works to build vital local economies based
on independent, locally-owned businesses and help local entrepreneurs to
thrive. They frequently play a key role in preventing chain proliferation and
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other trends from displacing local businesses. IBAs unite locally-owned
independent businesses, citizens and community organizations to achieve this
goal.
IBAs accomplish this through four focus areas:
1) Public education about the greater overall value local independents often
can provide (even when they are not the cheapest) as well as the vital
economic, social and cultural role independent businesses play in the
community.
2) Cooperative purchasing, branding, marketing, resource sharing and
other activities to help local businesses gain economies of scale and compete
more effectively.
3) Creating a strong and uncompromised voice for
local independents in the local government and media while engaging citizens
in guiding the future of their community.
Angel Capital Network
http://www.angelcapitalnetwork.com/
Goldman Sachs -
10,000 Small Businesses
is a $500 million investment to help create jobs and economic opportunity in
the United States.
http://www2.goldmansachs.com/citizenship/10000-smallbusinesses/index.html?cid=31070699
The initiative will unlock the growth and job-creation potential of 10,000 small
businesses across the United States through greater access to business
education, mentors and networks, and financial capital.
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Our 10,000 Small Businesses program includes: • Practical business and
management curriculum • Access to capital • Critical support and
consulting services
10,000 Small Businesses is a $500 million initiative that will unlock the growth
and job-creation potential of 10,000 small businesses across the United States
through greater access to business education, mentors and networks, and
financial capital. It is based on the broadly held view of leading experts that a
combination of education, capital and support services best addresses the
barriers to growth for small businesses.
Small businesses have generated 64 percent of net new jobs over the past 15
years. They represent 99.7 percent of all employer firms, hire 40 percent of
high tech workers, and produce 13 times more patents per employee than large
patenting firms.
How it Works
Goldman Sachs has an established track record through
10,000 Women and other initiatives that bring together people, capital and ideas
to address social and economic challenges. Building on these efforts, in 2009
Goldman Sachs announced 10,000 Small Businesses, a $500 million initiative that
will unlock the growth and job-creation potential of 10,000 small businesses
across the United States through greater access to business education, mentors
and networks, and financial capital. It is based on the broadly held view of
leading experts that a combination of education, capital and support services
best addresses the barriers to growth for small businesses. The program includes: Practical Business and Management
Curriculum for Small Business Owners 10,000 Small Businesses will
contribute $200 million to program partners, including local community
colleges, universities and other institutions, to provide scholarships to
underserved small business owners and build educational capacity. Students will
receive a practical education that focuses on skills that can immediately be
applied by business owners, including accounting, marketing and human
resources management. Leading business schools will contribute to national
curriculum development, which will be tailored by community colleges to
address the specific needs of local business owners. Business schools will also
work closely with community colleges to expand their capacity to educate small
business owners by training faculty and sharing best practices. Getting Capital Flowing to Small Businesses Goldman Sachs will invest
$300 million through a combination of lending and philanthropic support to
Community Development Financial Institutions (CDFIs) to help business
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owners reach their potential to access capital. The investment will increase the
amount of growth capital available to small businesses in underserved
communities and expand the capacity of the CDFIs to deliver enhanced
technical assistance to small businesses. Loans may be applied for through
Community Development Financial Institutions in keeping with their existing
loan practices. In addition, 10,000 Small Businesses will provide technical
assistance to graduates of the program to help them access other sources of
capital. Providing Critical Support Services for Small Businesses Small
business owners, particularly those operating in underserved communities,
often face challenges accessing mentoring, networking and expert advice.
Advice and technical assistance will be offered to participating small business
owners through partnerships with national and local business organizations,
professional services firms and the people of Goldman Sachs.
Banks Reach Out to Small Firms
http://online.wsj.com/article/SB10001424052748703507804576130591215
860046.html?mod=WSJ_SmallBusiness_LEADNewsCollection
FEBRUARY 8, 2011
Much of the holdup in small-business lending is caused by the continuing
struggles of many entrepreneurs to overcome weak sales and uncertainty about
the future, says William Dennis, a senior fellow with the NFIB Research
Foundation, part of the small-business trade group. The tumble in real-estate
values also made it harder for small-business owners to use a home or
commercial property as collateral for a loan.
Office of Advocacy of the U.S. Small Business Administration Provides
Data on Small Firm Lending, 2009-2010; Harbingers of Growth
http://www.businesswire.com/news/home/20110210007097/en/OfficeAdvocacy-U.S.-Small-Business-Administration-Data
WASHINGTON--(BUSINESS WIRE)--Lending to small firms by U.S.
financial institutions continued to decline, but began to stabilize in some loan
size categories over the 2009-2010 period. This is according to the Office of
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Advocacy’s latest edition of Small Business Lending in the United States, released
today. The study finds that small business lending dropped by 6.2 percent, less
than the 8.9 percent drop experienced in large firm lending over the 2009-2010
period. GDP has turned upward, and business lending may follow the pattern
of other recessions, in which commercial and industrial lending grew only after
recovery was well under way.
“As the economy improves, this study, through its state-by-state display
of lender performance, can help both small business borrowers and
lending institutions see where small firms are beginning to find the
capital they need.”
“Businesses and lenders continued to exercise caution in borrowing and
lending through 2009-2010,” said Chief Counsel for Advocacy Winslow
Sargeant. “As the economy improves, this study, through its state-by-state
display of lender performance, can help both small business borrowers and
lending institutions see where small firms are beginning to find the capital they
need.”
The study finds that lending in the smallest business loans under $100,000
began to stabilize in 2009-2010—the total was down by 1 percent, compared
with a 5.5 percent drop in 2008-2009, and real estate loans accounted for the
entire decline
Morgan Stanley Commits $500 Million to Enable Small Businesses
to Increase Investments and Create Jobs
Morgan Stanley partnership with community banks and nonprofits
to increase lending through U.S. Small Business Administration
loan program
Feb 10, 2011 – 12:48 PM EST
NEW YORK, Feb. 10 /CSRwire/ - Morgan Stanley (NYSE: MS)
announced today the launch of a new initiative to help deliver up to
$500 million of credit to small businesses seeking to increase investment
and create new jobs.
In collaboration with national nonprofits and local community banks,
Morgan Stanley will enable more small businesses to utilize the U.S.
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Small Business Administration's (SBA) 504 Loan Program which focuses
on providing the long-term capital small businesses need for commercial
real estate investments and job creation and retention. The initiative,
called the Morgan Stanley SBA 504 Program will be available through
Community Reinvestment Fund, USA (CRF), a nonprofit corporation,
and CDC Direct Capital, a wholly owned subsidiary of CDC Small
Business Finance, a certified development company that focuses on
serving the financing needs of small businesses.
"By extending financing for small businesses to invest and grow, Morgan
Stanley is reaffirming our commitment to put our financial capabilities
to work in the service of the economic development of communities,"
said Ruth Porat, Chief Financial Officer of Morgan Stanley.
CRF and CDC Direct Capital will work with a national network of
financial institutions to facilitate the purchase by Morgan Stanley of
existing and new loans collateralized by first liens on commercial real
estate originated as part of the SBA 504 Program. As cash-strapped
small businesses finally can access the capital resources they need, they
can reinvest in their businesses, creating jobs and helping build healthier
communities.
"Morgan Stanley is working with the public sector to maximize the
impact of the dollars it allocates towards economic development," said
Mike Mantle, Senior Advisor in Morgan Stanley's Global Sustainable
Finance Group. "We are pleased to work with these long-standing
industry professionals to respond to this critical need identified by
community development leaders."
By providing liquidity to community banks who lend to small businesses
through the SBA 504 program, Morgan Stanley will enable participating
financial institutions to limit credit exposure, reduce interest rate risk
related to fixed rate loans, retain more liquidity and make more SBA f irst
mortgage loans, helping small business owners obtain the long-term
financing they need.
"CRF has been helping connect communities with capital for more than
22 years, and we are pleased to continue that role with the SBA 504
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program and Morgan Stanley," said Frank Altman, CEO for CRF. "We're
looking forward to helping hundreds of small businesses lead our
country's economic recovery. CRF has been active throughout the nation
and this product will be a valuable tool from coast to coast."
Kurt Chilcott, President and CEO of CDC Small Business Finance
added, "For the past 32 years, CDC Small Business Finance has helped
thousands of small businesses access billions of dollars of capital
through a range of programs and services. Our relationship with Morgan
Stanley will allow us to reach even more small businesses with essential
capital for growth and expansion, which will lead to more jobs in the
communities we serve."
The Morgan Stanley 504 Program will be available through CRF and
CDC Direct Capital, each working directly with financial institutions to
identify qualified borrowers and facilitate financing from Morgan
Stanley. Visit www.crfusa.com or www.cdcloans.com for more
information on how banks and community lenders across the country
can benefit from this unique lending program. Small business owners
interested in the program should contact their community or regional
bank.
About Morgan Stanley Morgan Stanley is a leading global financial
services firm providing a wide range of investment banking, securities,
investment management and wealth management services. The Firm's
employees serve clients worldwide including corporations, governments,
institutions and individuals from more than 1,200 offices in 42 countries.
For further information about Morgan Stanley, please
visit www.morganstanley.com.
About CRF Community Reinvestment Fund, USA (CRF), a nonprofit
organization and certified Community Development Financial
Institution, is the nation's leader in bringing capital to public and private,
nonprofit community development lenders through the secondary
market for community development loans. Formed in 1988, CRF has
injected more than $1 billion into low-income and economically
disadvantaged communities around the country to help stimulate job
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creation and economic development, provide affordable housing, and
support community facilities. CRF is headquartered in Minneapolis,
Minn. www.crfusa.com
About CDC Direct Capital CDC Direct Capital's mission is to provide
secondary market solutions to SBA 504 lenders across the United States
connecting them to the wholesale lending markets. Its vision is to
increase lenders' access to capital to expand financing options to small
businesses.http://www.cdcloans.com
About CDC Small Business Finance CDC Small Business Finance
provides SBA 504 loans to small businesses as well as access to other
capital through distinctive, innovative financing products and services.
In addition, CDC reinvests in communities, particularly underserved
markets and populations in California, Nevada and
Arizona. http://www.cdcloans.com
Why Do So Many New Businesses Fail?
Research by the U.S. Bureau of Labor Statistics shows that nearly six in ten
businesses shut down within the first four years of operation. While not as
calamitous as the 90% failure rate often repeated as fact, the BLS statistics are
sobering for anyone tempted to invest their time and personal savings into
launching a small business. To avoid becoming a statistic yourself, I have put
together the top reasons so many new businesses fail.
The Top 10 Reasons Startups Fail
http://www.squidoo.com/starup_failures
III. Cooperatives and ESOP Companies:
- How do Cooperatives and ESOP’s perform financially vs. shareholder
businesses? For example:
o The Employee Ownership Index (EOI) has consistently
outperformed the FTSE All-Share. In cash terms, an investment
of £100 in the EOI in 1992 would have been worth £349 at the
end of June 2003; the same amount invested in the FTSE AllShare would have been worth £161.
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List of employee-owned companies
http://en.wikipedia.org/wiki/List_of_employee-owned_companies
The National Center for Employee Ownership
http://www.nceo.org/main/article.php/id/11/
The ESOP Association
http://www.esopassociation.org/
• There are approximately 11,500 ESOPs in place in the U.S., covering 10
million employees (10% of the private sector workforce).
• These employees draw in excess of 3% of their total compensation from
ESOP contributions.
• The growth of ESOP formation has been influenced by federal legislation.
While the rapid increase in new ESOPs in the late 1980s subsided after
Congress removed certain tax incentives in 1989, the overall number has
remained steady with new plans replacing terminated ESOPs. Currently,
it is estimated that there are approximately 11,500 ESOPs in place in the
U.S. However, there is no precise way to measure this figure accurately
since the overwhelming majority of ESOP companies are privately held
and do not file public reports with the SEC.
• About 330 ESOPs - 3% - are in publicly traded companies. However, these
companies employ just under 50% of the nation's 10 million employee
owners.
• An estimated 7,000 of the 11,500 companies have ESOPs that are large
enough to be a major factor in the corporation's strategy and culture.
• Approximately 4,500 ESOP companies are majority-owned by the ESOP.
• Approximately 3,000 are 100% owned by the ESOP.
• About 2% of ESOP companies are unionized.
• While ESOPs are found in all industries, over 20% of them are in the
manufacturing sector.
• At least 70% of ESOP companies are or were leveraged, meaning they used
borrowed funds to acquire the employer securities held by the ESOP
trustee.
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• An overwhelming majority of ESOP companies have other retirement
and/or savings plans, such as defined benefit pension plans or 401(k)
plans, to supplement their ESOP.
• Of the 11,500 employee-owned companies nationwide, fewer than 2% were
financially distressed when they established their ESOP.
Total assets owned by U.S. ESOPs is estimated to be $901 billion at the end of
2007.
Corporate Performance
• In the new book, Shared Capitalism at Work: Employee Ownership, Profit and Gain
Sharing, and Broad-Based Stock Options, edited by Douglas L. Kruse,
Richard B. Freeman, and Joseph R. Blasi, the editors list some take away
findings on shared capitalism. The book identifies employee stock
ownership plans (ESOPs) as a primary model of shared capitalism in the
U.S. Below are the summarized findings.
Shared capitalism is a significant part of the U.S. economic model.
Shared capitalism can increase wealth for workers at lower and
middle income levels.
Shared capitalism improves the performance of firms. It is associated
with greater attachment, loyalty, and willingness to work hard;
lower chance of turnover; worker reports that co-workers work
hard and are involved in company issues; and worker suggestions
for innovations. Shared capitalism is most effective when
combined with employee involvement and decision-making and
with other advanced personnel and labor policies.
Shared capitalism improves the performance of worker well-being. It
is associated with greater participation in decision-making; higher
pay, benefits, and wealth; greater job security, satisfaction with
influence at the workplace, trust in the firm, and assessment of
management; and better labor management relations practices.
Shared capitalism is most effective when combined with employee
involvement and decision-making and with other advanced
personnel and labor practices.
Shared capitalism complements other labor policies and practices.
Forms with shared capitalism compensation are more likely to
have other worker-friendly labor policies and practices.
Combinations of shared capitalist pay and other policies, such as
devolving decision-making to employees, wage at or above the
market rate, and lower supervisory monitoring, produce the
largest benefits for workers and firms.
The risk of shared capitalism investments in one’s employer is
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manageable. Portfolio theory suggests employee ownership can
be part of an efficient portfolio as long as the overall portfolio is
properly diversified. Most workers have modest amounts of
employee ownership within the ranges suggested by portfolio
theory. Less risky forms of shared capitalism such as cash profit
sharing and stock options where workers are paid market wages,
or company stock is not financed by worker savings, can be
prudently combined with riskier forms where workers purchase
stock.
Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and BroadBased Stock Options, edited by Douglas L. Kruse, Richard B. Freeman, and
Joseph R. Blasi, The University of Chicago Press, National Bureau of
Economic Research, 2010. Above information can be found on page 12.
2. In August 2010, The ESOP Association and the Employee Ownership
Foundation released the results of a survey conducted among the
Association’s 1,400 corporate members which confirmed positive
benchmarks for ESOPs. The eye-opening statistics of the 2010 survey
are the increase in age of the ESOP and account balances. In 2010, the
average age of the ESOP was reported to be 15 years, demonstrating
ESOP companies are sustainable. In addition, the average account
balance has risen dramatically to $195,222.65; a high figure compared to
most data tracking defined contribution plans which correlates with the
age of ESOPs participating in this year’s survey. And approximately
90% of members reported having retirement savings plans in addition to
the ESOP including the use of 401(k) plans, pension plans, stock
purchase plans, and stock options. In terms of motivation and
productivity, 84% of respondents agree that the ESOP improved
motivation and productivity. The Company Survey is conducted every
five years and was last completed in 2005. Prior to 2005, the survey was
completed in 2000.
Also in September 2010, the Employee Ownership Foundation released the
results of an extensive study it funded that evidenced that ESOPs provide more
employee benefits than non-ESOP companies. The study, which reviewed data
from the Department of Labor Form 5500 on defined contribution retirement
plans, found:
• ESOP companies have at least one plan, the ESOP, but more than half
(56%) have a second retirement savings/defined contribution plan, likely
a 401(k) plan. In comparison, the Bureau of Labor statistics reports that
47% of companies have some sort of defined contribution plan which
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shows that an ESOP company is more than likely to have two defined
contribution plans than the average company is to have one plan.
• The average ESOP company contributed $4,443 per active participant; in
comparison to a non-ESOP company with a defined contribution plan
which contributed on average $2,533 per active participant. This study
found that on average ESOP companies contributed over 75% more to
their ESOPs than other companies contributed to their primary plan.
The project was done by the National Center for Employee Ownership
(NCEO).
Finally, in the summer of 2010, the Employee Ownership Foundation released
its 19th Annual Economic Performance Survey (EPS), that evidenced a very
high percentage of companies, 91%, declared that creating employee ownership
through an ESOP (employee stockownership plan) was “a good decision that
has helped the company.”
1. In June 2008, Brent Kramer, a doctoral candidate at the City University of
New York, now Ph.D., submitted a study, Employee Ownership and
Participation Effects on Firm Outcomes, that “provides strong evidence that
majority employee-owned businesses have a significant advantage over
comparable traditionally-owned businesses in sales per employee.” The
average advantage, $44,500, means that a typical 200 person ESOP firm
could be expected to have an almost $9 million annual sales advantage
over its non-ESOP counterpart. Sales per employee is the total of a
company’s sales divided by the number of employees, and is a
commonly used measure of a company’s productivity. Highlights of the
study include: 1.) Using standard statistical methods, it was found that
the average sales advantage for the ESOP firms in the study was
$44,500, or an average of an 8.8% sales per employee advantage over
their non-ESOP counterparts in the same industry and of the same size;
2.) It was found that firms that ask for non-management employee input
into innovation in work processes have a greater employee-owned
advantage in sales per employee; 3.) Kramer’s research indicates the sales
per employee advantage for the 50% plus ESOP companies compared
to non-ESOP companies is less for larger employers. The Employee
Ownership Foundation providing funding for the research and The
ESOP Association contributed membership information to the study. A
total of 328 ESOP firms and over 2,000 matching non-ESOP firms were
included in the study.
2. In January 2007, the co-operative relationship between the Employee
Ownership Foundation and the University of Pennsylvania’s Center for
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Organizational Dynamics led to an important new and “fresh” study of
the effectiveness of ESOPs and employee ownership as uncovered in 30
years of scholarly research on the issue. The study, “Effects of ESOP
Adoption and Employee Ownership: Thirty Years of Research and
Experience,” authored by Dr. Steven F. Freeman, Affiliated Faculty and
Visiting Scholar in the Center for Organizational Dynamics, Graduate
Division, School of Arts and Sciences at the University of Pennsylvania,
confirms what the Association has been saying for years, that employeeowned companies experience increased productivity, profitability, and
longevity. To download the study, “Effects of ESOP Adoption and
Employee Ownership: Thirty Years of Research and Experience,” please
visit the University of Pennsylvania’s Library Digital Archive http://repository.upenn.edu/od_working_papers/2/. The research was
possible thanks to a generous, unrestricted donation to the University by
ESOP Association member company, Alliance Holdings Inc. of Willow
Grove, PA. Alliance is also a significant donor to the Employee
Ownership Foundation, which gives significant donations to the
University of Pennsylvania’s Center for Organizational Dynamics
Program.
3. The most comprehensive and significant study to date of ESOP performance
in closely held companies was conducted by Dr. Joseph R. Blasi and Dr.
Douglas L. Kruse, professors at the School of Management and Labor
Relations at Rutgers University, and funded in part by the Employee
Ownership Foundation. The study, which paired 1,100 ESOP companies
with 1,100 comparable non-ESOP companies and followed the businesses for
over a decade, reported overwhelmingly positive and remarkable results
indicating that ESOPs appear to increase sales, employment, and
sales/employee by about 2.3% to 2.4% over what would have been
anticipated, absent an ESOP. In addition, Drs. Blasi and Kruse
examined whether ESOP companies stayed in business longer than nonESOP companies and found that 77.9% of the ESOP companies
followed as part of the survey survived as compared to 62.3% of the
comparable non-ESOP companies. According to Drs. Blasi and Kruse,
ESOP companies are also more likely to continue operating as
independent companies over the course of several years. Also, it is
substantially more probable that ESOP companies have other
retirement-oriented benefit plans than comparable non-ESOP
companies, such as defined benefit plans, 401(k) plans, and profit
sharing plans.
4. Research done by the Washington State Department of Community, Trade
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traded ESOP companies compared to 500 not publicly-traded nonESOP companies showed that the ESOP companies paid better
benefits, had twice the retirement income for employees, and paid higher
wages than their non-ESOP counterparts. Wealth and Income
Consequences of Employee Ownership: A Comparative Study from
Washington State, Kardas, Peter A., Scharf, Adria L., Keogh, Jim,
November, 1998.
5. In 1995, Douglas Kruse of Rutgers University examined several different
studies between ESOPs and productivity growth. Kruse found through
an analysis of all studies that "positive and significant coefficients [are
found] much more often than would be expected if there were no true
relation between ESOPs and productivity." Kruse concludes that "the
average estimated productivity difference between ESOP and nonESOP firms is 5.3%, while the average estimated pre/post-adoption
difference is 4.4% and the post-adoption growth rate is 0.6% higher in
ESOP firms. Kruse cites two studies as part of his research: Kumbhakar
and Dunbar's 1993 study of 123 public firms and Mitchell's 1990 study
of 495 U.S. business units in public firms. Both reports found
significant positive effects of greater productivity and profitability in the
first few years after a company adopted an ESOP.
In 1995, the U.S. Department of Labor released a study entitled "The Financial
and Non-Financial Returns to Innovative Workplace Practices: A Critical
Review." This study found that companies that seek employee participation,
give employees company stock, and train employees, can positively affect
American corporations' bottom lines. In addition, the report cited three studies
that analyzed "the market reaction to announcements of ESOPs which found
significant positive returns to firms which implemented ESOPs as part of a
broader employee benefit or wage concession plan." The three studies are:
Chang's 1990 "Employee Stock Ownership Plans and Shareholder Wealth: An
Empirical Investigation," Dhillon and Ramirez' 1994 "Employee Stock
Ownership and Corporate Control," and Gordon and Pound's 1990 "ESOPs
and Corporate Control." citation at (202) 293-2971 or E-mail:
esop@esopassocation.org.
ESOP Statistics
Largest Corporate ESOP Association Members
(Ranked by Number of
Employee Participants)
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Company
Location
Number of Participants
Publix Super Markets, Inc
Lakeland, FL
84,000
Procter and Gamble Co.
Cincinnati, OH
40,000
Amsted Industries
Chicago, IL
12,500
Parsons Corporation
Pasadena, CA
12,000
Lifetouch, Inc
Eden Prairie, MN
11,500
W.L. Gore Associates
Newark, DE
7,000
International Co-operative Alliance
http://www.ica.coop/al-ica/
Statistical Information on the Co-operative Movement
The Co-operative Movement brings together over 1 billion people around the
world. The United Nations estimated in 1994 that the livelihood of nearly 3
billion people, or half of the world's population, was made secure by cooperative enterprise. These enterprises continue to play significant economic
and social roles in their communities. Below are some facts about the
Movement that demonstrate their relevance and contribution to economic and
social development.
http://www.ica.coop/coop/statistics.html
Canadian Co-operative Association
http://www.CoopsCanada.coop/
The Canadian Co-operative Association provides leadership to promote,
develop and unite co-operatives and credit unions for the benefit of people in
Canada and around the world. Our members come from many sectors of the
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economy, including finance, insurance, agri-food and supply, wholesale and
retail, housing, health, and the service sector.
• There are approximately 9,000 co-operatives in Canada, providing products
and services to 17 million members.
• Co-operatives exist in virtually every sector of the economy, from agriculture,
retail and financial services to housing, child care, funeral services and
renewable energy.
• Co-operatives have more than $330 billion in assets, owned by their members
and the communities they serve.
• Co-operatives employ 150,000 people and are led by 100,000 volunteer
directors and committee members
• Canada has the highest per-capita credit union membership in the world: 33
per cent of Canadians are a member of at least one credit union.
• There are at least 2,000 communities with at least one credit union or caisse
populaire and more than 1,100 communities in which a financial cooperative is the only financial services provider.
• The survival rate of co-ops is higher than that of traditional businesses. A
2008 study in Quebec found that 62 per cent of new co-ops are still
operating after five years, compared with 35 per cent for other new
businesses. After 10 years, the figures are 44 per cent and 20 per cent
respectively.
• Co-operatives, credit unions and caisses populaires give millions of dollars
back to their communities in the form of sponsorships and donations.
• The co-op sector has deep roots in Canada. In the late 19th century, farmers
in Quebec, Ontario and Atlantic Canada developed co-operative
creameries and cheese factories to meet the needs of the growing dairy
industry. Alphonse Desjardins founded Canada's first caisse populaire in
Lévis, Quebec in 1900. And in the first decade of the 20th century,
farmers in western Canada organized co-operatives in an effort to
market their products.
Cooperatives and the crisis: “Our customers are also our owners”
Cooperatives have been more resilient to the deepening global economic and
jobs crisis than other sectors. Report from Sweden.
http://www.ilo.org/global/about-the-ilo/press-and-mediacentre/insight/WCMS_142558/lang--en/index.htm
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The financial crisis which has transformed the financial world for the past two
years is bringing some unaccustomed attention to this diverse family of
businesses, which share the common feature that they operate to bring benefits
to their members-customers rather than to investor shareholders. The business
magazine The Economist, for example, earlier this year reported that
cooperative banks had been steadily increasing their market share in Europe in
recent years. Customers, it seemed, were seeking security and reassurance. A
recent study by the German central bank (Bundesbank) found coop banks
more financially stable and less likely to fail than shareholder-owned
institutions.
Co-ops & Investor-owned Corporations Compared
http://www.co-opmonth.coop/primer/compared.html
The governance structure of cooperatives is significantly more open,
democratic, transparent and inclusive than that of Investor-owned
corporations. A recent, national survey indicates that the public views
businesses with the co-op governance characteristics listed below as more
trustworthy than businesses that lack these attributes.
Ownership
Cooperatives: Owned by members—the people who buy the goods or use
the services of the cooperative.
Investor-owned Corporations: Owned by outside shareholders who may
or may not use the goods and services of the business.
Control
Cooperatives: Wholly democratically controlled by the members on a onemember, one-vote basis (i.e., all members have an equal voice in the
business regardless of their equity share).
Investor-owned Corporations: Controlled by shareholders according to
their investment share. Shareholders must meet a threshold of ownership to
have any meaningful control over the company.
Board Membership
Cooperatives: Board is made up of the co-op members who are elected by
the members. Most, if not all, directors are independent—they are not
selected by the CEO and typically do not work for or have any business
relationship with the co-op, other than their patronage of it. Management
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typically does not hold board seats.
Investor-owned Corporations: Board is made up of a combination of
independent directors, management and other directors with financial or
business ties to the organization. CEOs often serve as board chair.
Board Compensation
Cooperatives: Cost reimbursement for board meetings. Board members
typically serve on an uncompensated, volunteer basis.
Investor-owned
Corporations: Significant financial compensation provided.
Board Nominations
Cooperatives: Candidates are nominated by membership either directly
(including self-nomination), or by a nominating committee made up of the
members. Nominating committees may be made up of board members or
include other co-op members. They typically issue a call for nominations to
the membership prior to each election. Co-ops circulate a single election
ballot including all nominated candidates.
Co-op bylaws generally allow any member to nominate a director-candidate.
Where a petition is required to place a candidate’s name on the slate, the
threshold for signatures is generally low (e.g. 100 signatures or 1% of
membership).
Investor-owned Corporations: Candidates nominated by the board of
directors and management, often by a nominating committee. Management
maintains careful control over board candidates. Board proxy materials
include only board nominees. Shareholders have only limited ability to
nominate their own director candidates and must do so on a separate proxy
statement that they circulate and tabulate at their own expense, ranging in
cost from $100,000 to $1 million. (AFSME, 2003) Shareholders must also
execute that separate proxy card to vote for other candidates. Shareholders
may recommend nominees to the nominating committee, but companies
rarely nominate such candidates. Shareholders may also nominate directors
in person at the annual meeting, but few shareholders attend and such
nominees rarely receive sufficient support.
Board Elections
Cooperatives: Board is elected by the members on a one-member, one vote
basis. Contested elections are the norm, not the exception. Members vote inperson at the annual meeting, by mail, or electronically, or by a combination
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of these methods.
Investor-owned Corporations: Board elections are better characterized as
shareholder "ratification" of the uncontested, management/board-selected
slate offered on the proxy statement. Because the board typically nominates
only enough candidates, often incumbents, to fill open seats, whether or not
a shareholder submits a proxy matters little. Shareholders submit proxy in
advance or must attend the annual meeting to vote in person.
Accountability
Cooperatives: Board members are directly accountable to members through
these nomination and election procedures. Board members can be, and
often are, voted out in contested elections.
Investor-owned Corporations: Election and nomination procedures afford
little meaningful oversight to shareholders. It is difficult and costly for
shareholders to remove board members.
Dividends
Cooperatives: Any surplus revenues (profits) earned by the co-op are
reinvested in the business and/or returned to members based on how much
business they conducted with the co-op that year—their patronage—or
through lower prices or fees. Many co-ops are obligated to return a portion
of their "surplus revenues"—if there are any—to members each year.
Investor-owned Corporations: Profits returned to shareholders based on
their ownership share. Corporations are generally not obligated to pay out
dividends.
Motivation
Cooperatives: Maximize member-service
Investor-owned Corporations: Maximize shareholder returns.
Structure
Cooperatives: Co-ops operate on a not-for-profit basis. Depending on the
type, co-ops can organize under a variety of structures—as co-ops, as nonprofits, and as regular corporations. All co-ops operate according to co-op
principles.
Investor-owned Corporations: Generally organized as C corporations.
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SURVEY REVEALS MORE TRUST FOR COOPERATIVES THAN
FOR INVESTOR-OWNED CORPORATIONS
CONSUMERS TRUST MORE ACCOUNTABLE BUSINESSES, PREFER
COOPERATIVES
http://docs.google.com/viewer?a=v&q=cache:s3qudPmH2QJ:www.consumerfed.org/elements/www.consumerfed.org/file/other/s
urveycoops.pdf++How+do+Cooperatives+perform+financially+vs.+shareholder+businesses
%3F&hl=en&gl=us&pid=bl&srcid=ADGEESjC0hbRyqMe7lC_w2sQ7TeGe7ktTZSmg3dHXGMYKQ9iYt9kh3mc302z3ilrSdCIHhGILSdSs
UWUG1R_rWF9z-d8r34hUGZY_S5tVOllvuMvkww00puMq111o7ljdIBPsrqNui&sig=AHIEtbQASQcwXZhqqYfMAQbVz277Uok2eQ
Washington D.C.— As federal regulators scrutinize corporate governance and
board election practices, survey results unveiled today found that less than half
of Americans think investor-owned corporations are ethically governed. The
survey found significantly greater public trust in businesses that provide more
consumer control and board accountability.
The survey of 2,031 adults, released today by the National Cooperative
Business Association (NCBA) and the Consumer Federation of America
(CFA), found that two-thirds of consumers believe businesses that are owned
and governed by their customers and have consumers on their boards of
directors are more trustworthy than those that do not. A majority also found
companies that allow customers to democratically elect the board of directors,
and are locally owned and controlled to be more trustworthy.
Co-ops Rate Higher Than Investor-owned Corporations
The survey also found that consumers rate businesses that have these
governance characteristics— cooperatives— higher than investor-owned
companies. Co-ops are owned and governed by their members— the people
who use their services or buy their goods— rather than by outside investors.
Member-owners directly elect the board of directors from within the
membership and the business returns surplus revenues to the members, not to
outside investors. More than half of adults in the U.S. say they’ members of
cooperatives.
NCBA’ CEO and President Paul Hazen said that more than 75 percent of
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those surveyed agreed that co-ops run their businesses in a trustworthy manner
compared to just 53 percent for investor-owned companies. More than twothirds agreed that consumer-owned co-ops are ethically governed, while just 45
percent said the same of investor-owned corporations.
Asked whether consumer co-ops have the best interests of consumers in mind
when conducting business, 77 percent of Americans agreed they did. Fewer
than half said the same of investor-owned counterparts. Co-ops also rated
higher than investor-owned companies by wide margins on questions of value,
quality, price, and commitment to their communities.
“Public trust is the first casualty of corporate accountability scandals,” said
CFA Executive Director
Stephen Brobeck, at a press conference today. “Fortunately, this survey
demonstrates that there’ a solution to consumer concern about their lack of
control that goes beyond anything the Securities and Exchange Commission,
the New York Stock Exchange, or Congress are willing to do. Consumers
believe the nation’ more than 40,000 co-ops offer more democratic,
accountable options and trustworthy options. And those are options they
clearly prefer.”
Consumer Preference for Cooperatives
Asked whether they would be more or less likely to buy products or services
from a business if they knew it to be a cooperative:
73% were more likely to buy products from a food cooperative
71% were more likely to use a credit union
69% were more likely to patronize independent, local businesses that belonged
to a buying co-op
69% were more likely to purchase food produced by a farmer-owned
cooperative
67% were more likely to buy electricity and telecomm services from a local
utility co-op
56% were more likely to use day care services provided by a parent-owned coop
55% were more likely to prefer health care services offered by a consumerowned provider
51% were more likely to hold policies with a mutual insurance company
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Hazen said consumers also demonstrated particularly strong support for
farmer-owned cooperatives, with more than 80 percent agreeing these co-ops
strengthen rural communities and help farmers succeed. Sixty-four percent
agreed that food products produced by farmer-owned cooperatives were of
higher quality than those produced by other types of companies.
Co-op Members Rate Co-ops Higher, Consumers Need More Information
Though the survey found a majority surveyed preferred to do business with coops and rated them more highly than investor-owned corporations, trust and
preference for co-ops was even stronger among those who said they were
already members of cooperatives.
“The survey demonstrates that consumers know co-ops by their reputation for
quality service and products,” Hazen said. “And those who are already
members of co-ops have an even stronger loyalty to, and preference for them.
Regardless of how you measure it— in terms of cost savings, value or
satisfaction— consumers can get more for their money at cooperatives.”
According to the Credit Union National Association, the average credit union
household saves $149 per year by belonging to a credit union rather than a
bank or a thrift. University of Minnesota research found that owners of
cooperative housing save $16 per unit per month in operating costs compared
to rental units. And retail co-op members receive savings through member
discounts or through end-of- year dividends. Members of other cooperatives
also receive end-of-year dividends.
“The challenge is in raising consumer awareness of and access to cooperatives,”
said Hazen who, together with Brobeck, urged state and federal consumer
bureaus to make more information about cooperatives available to consumers.
Methodology
Opinion Research Corporation surveyed 2,031 adults during July 24-28. At a 95
percent confidence level, the maximum expected error is +/- two percent. The
survey was sponsored by NCBA and a coalition including CUNA, the National
Assn. of Federal Credit Unions, the National Cooperative
Bank, the National Milk Producers Assn., the National Rural Electric
Cooperative Assn., the National
Rural Telecommunications Cooperative, the National Rural Utilities
Cooperative Finance Corporation, and the National Telecommunications
Cooperative Assn.
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Survey Findings
SURVEY DETAILS
CORPORATE
GOVERNANCE
CO-OPS VS.
INVESTOR-OWNED
CORPORATIONS
Customer Needs
Committed to
Service
Committed to
Community
Best Interests of
Consumers
Trustworthy
High Value Products
Ethically Governed
2,031 adult Americans were polled July 24-28 by The Opinion Research
Corporation, Princeton, N.J., on their perceptions of corporate governance
practices; about cooperatives and investor-owned corporations; and their
preferences for co-ops. At the 95 percent confidence level, the survey has a +/two percent margin of error.
Respondents were read a list of corporate governance characteristics and asked
if they made a business more or less trustworthy.
Roughly two of three adult Americans said that a business that is owned and
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governed by the people who buy its goods or use its services
is more trustworthy.
68% said that a business that has consumers on its board of directors is more
trustworthy.
62% said a locally owned and controlled business is more trustworthy.
55% said a business that allows its customers to democratically elect its board
of directors is more trustworthy.
Respondents were given ten positive business attributes and asked whether
each attribute described co-ops and investor-owned corporations.
Co-ops outscored investor-owned corporations on eight of ten attributes, in
some cases by more than 25 points.
81% agreed that co-ops can be counted on to meet their customers needs,
compared to 65% for investor-owned corporations.
79% agreed that co-ops are committed to providing the highest quality service
to their customers, compared to 58% for investor-owned corporations.
78% agreed that co-ops are committed to and involved in their communities,
compared to 53% for investor-owned corporations.
77% agreed that co-ops have the best interests of consumers in mind,
compared to 47% for investor-owned corporations.
76% agreed that co-ops run their businesses in a trustworthy manner,
compared to 53% for investor-owned corporations.
74% agreed that co-ops provide products and services that are of high
value, compared to 63% for investor-owned corporations.
68% agreed that co-ops are ethically governed, compared to just
45% for investor-owned corporations.
Competitive Prices
Charitable Giving
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Marketplace Choice
64% agreed that co-ops offered the most competitive prices, compared
to 54% for investor-owned companies.
A nearly equal percentage agreed that co-ops (57%) and investorowned corporations (58%) engage in charitable giving.
Investor-owned corporations outscored co-ops on marketplace choice.
While 53% agreed co-ops offer consumers more choices in the marketplace,
62% agreed that investor-owned corporations did.
CONSUMER
PREFERENCE FOR
COOPERATIVES
FARMER-OWNED
COOPERATIVES
Respondents were asked whether knowing that a business is a co-op affects the
likelihood they would buy its goods or use its services.
More than 2/3 of consumers were more likely patronize food co-ops
(73%), credit unions (71%), local utility co-ops (67%), and local, independent
businesses that belong to a buying co-op (69%).
More than a majority was more likely to use parent-owned day care co-ops
(56%), consumer-owned healthcare co-ops (55%) and buy policies from mutual
insurance companies (51%).
33% were more likely, and 43% were less likely to buy a unit or home in a local
housing cooperative. However, a majority of African Americans were actually
more likely to purchase a co-op unit or home.
Respondents were asked whether they agreed or disagreed with four statements
about farmer-owned cooperatives.
83% agreed that farmer-owned co-ops help farmers succeed.
82% agreed that farmer-owned co-ops strengthen rural communities.
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69% said they were more likely to purchase food produced by a farmerowned cooperative than those produced by other types of companies.
64% agreed that food produced by a farmer-owned cooperative was of
better quality than food produced by other types of companies.
MEMBERSHIP
More than half of American adults say they are members of cooperatives.
FAMILIARITY WITH
CO-OPS
Asked how familiar respondents were with the details of co-op organization
and philosophy—
47% said they were familiar with co-ops; 30% said they were not very familiar;
and 22% are not at all familiar.
Familiarity was higher among men than women, among 45-64 year olds
compared to other age groups, and among adults in households earning more
than $35,000 annually compared to lower income groups.
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