Analysing the Internationalization of Co-operatives

As a result of processes of economic globalization, co-operatives, likeother businesses, are coming under increased competitive pressures andfacing new market opportunities. As a result, co-operatives areincreasingly being pushed and pulled into the international economy. Formany co-operatives, this may be an unfamiliar and often uncomfortablesituation. It is unfamiliar because most co-operatives, typicallycharacterized by their strong ties to local communities, have been in the past reluctant to internationalize. It can be an uncomfortable situation because co-operatives can face particular challenges in competing ininternational markets. Unlike traditional businesses, co-operatives areconstrained by co-operative principles and values which imposerestrictions on their organizational structures and business practices. In the international economy, conforming to such principles and values can restrict the modes of internationalization that co-operatives can employand can potentially place them at a significant disadvantage vis-à-vist raditional investor-oriented firms (IOFs). This tension is all the more severe when co-operatives find themselves pushed into the international realm by the need to become more competitive. It is this situation that thischapter investigates—the nature of the tension that co-operatives facewhen operating in international markets between living up to co-operative values and principle, on the one hand, and being competitive, on the other.