Framework for Equitable Profit Sharing

NOTE THIS MAY CHANGE AFTER VOTNG ON 28th Febuary 2026's AGM

Agreed Equitable Formula:

50% of Profit goes to Mandatory  Reserve: The cooperative rules state that 50% of its profits go to a reserve fund to ensure financial stability and future growth. 

Shareholders (Equity Shares): After allocating the reserve, the cooperative distributes 25% of the remaining profits to its shareholders. 

Members (Membership Dividends): The remaining profits are then distributed among the members based on an activity-based allocation. Members who actively contribute to the cooperative's operations or generate higher business volume receive a larger share of the remaining profits. This allocation can be determined based on factors such as the level of activity, sales volume, or other measurable contributions such as time spent supporting the cooperative's mission.

Members Split Factors:

Weighting Factor:Time

Weighting factor to each member based on the time they contribute relative to the total time contributions. For instance:

Member A: Contributed 50 hours per year, (95 mins per week )Weighting Factor = 0.5%Member B: Contributed 100 hours per year, (1 hour.90 mins per week ), Weighting Factor = 10%Member C: Contributed 200 hours per year, (4 hour per week ) Weighting Factor = 20%Member D: Contributed 300 hours per year, (8 hours per week ), Weighting Factor = 30%

Weighting Factor: Financial

Weighting factor to each member based on their level of funding or business volume brought to the cooperative. This factor represents their relative contribution compared to the total contributions. For instance:

Member A: Sales/Funding volume of $50,000, Weighting Factor = 0.5%Member B: Sales/Funding volume of $100,000, Weighting Factor = 10%Member C: Sales/Funding volume of $200,000, Weighting Factor = 20%Member D: Sales/Funding volume of $300,000, Weighting Factor = 30%

Secondary Rules

Member commitment

All Members agree to attend general meetings and take an active interest in the operation and development of the Co-operative and its business. Members have a duty to respect the confidential nature of the business decisions of the Co-operative.12.In accordance with the Co-operative Principle of education, training and information, the Co-operative shall provide Members with information about what the role of a Member is within the Co-operative and will provide training in the skills required to be a Member and to participate in the operation of the Co-operative.13.The Co-operative shall provide ongoing education and training in co-operative values and Co-operative Principles and associated topics. The Co-operative shall support its Members by ensuring that general meetings are accessible and encourage participation. Being part of a cooperative means being part of a democratic organization where members come together to pursue common goals, share resources, and support each other in their economic and social endeavors. As a cooperative member, there are several key aspects to consider: 14.

What this means

Active Participation: members should actively engage in the cooperative's activities and decision-making processes. Attend general meetings, join committees, and contribute to discussions and decision-making. Actively participate in the cooperative's governance, as cooperative success relies on the involvement and input of its members.Cooperative Values and Principles: Understand and embrace the cooperative values and principles. These include voluntary and open membership, democratic member control, member economic participation, autonomy and independence, education and training, cooperation among cooperatives, and concern for the community. Upholding these values helps maintain the cooperative's integrity and purpose.Support Cooperative Sustainability:  members should work towards the long-term sustainability of the cooperative. This involves supporting financial stability, promoting efficient resource utilization, and striving for growth and innovation. Members can contribute by their monthly or yearly membership payments and by patronizing the cooperative's products, events or services, actively promoting its offerings, and bringing in new members.Active Collaboration: Cooperatives thrive on collaboration and cooperation among members. Members should be willing to collaborate, share knowledge, and support each other's endeavors. This can involve sharing resources, providing advice or mentorship, or even engaging in joint marketing or purchasing initiatives. The cooperative's success depends on the collective efforts and support of its members.Responsible Financial Practices: members should maintain financial responsibility and contribute to the cooperative's economic well-being. This includes fulfilling financial obligations, such as purchasing and maintaining the required shares, paying membership fees, and timely payment for goods or services received from the cooperative. By fulfilling financial responsibilities, members contribute to the cooperative's financial stability and sustainability.Continuous Learning:  members should actively seek opportunities for education and training to enhance their knowledge and skills. By staying informed about cooperative principles, industry trends, and best practices, members can contribute more effectively to the cooperative's success. Actively participate in training programs, workshops, and educational events organized by the cooperative.

Remember, being part of a cooperative is not just about personal gain but also about working collectively for the benefit of all members. By actively participating, upholding cooperative values, supporting sustainability, collaborating, being financially responsible, and embracing continuous learning, members can play a crucial role in the cooperative's growth and success.

Termination of Membership

 A Member shall cease to be a Member of the Co-operative under the conditions outlined in the Rules.

Equity shareholders

As an equity shareholder of a cooperative, you hold an ownership stake in the cooperative and have certain rights and responsibilities. Here's what it means to be an equity shareholder in ©Center for Sustainable Action

Ownership and Voting Rights: As an ‘equity’ shareholder, you have ‘ownership’ in the cooperative. This typically comes in the form of shares that represent your stake in the cooperative's assets and earnings. Equity Shares may be held by any Person. Equity Shareholders will not be deemed to be Members of the Co-operative. .26They shall carry no rights to vote at general meetings of the Co-operative, but will carry a right to vote at meetings of the Equity Shareholders. Each Equity Shareholder shall have only one vote at a meeting of the Equity Shareholders regardless of the number of Equity Shares held by them. The provisions of these Articles relating to general meetings of the Co-operative and their proceedings shall apply to all meetings of the Equity Shareholders. 27Financial Support: Equity shareholders play a vital role in providing financial support to the cooperative. This includes purchasing and holding the required number of shares as specified in the cooperative's bylaws. By meeting your financial obligations, you contribute to the cooperative's capital and financial stability. Additionally, consider investing additional capital if the cooperative seeks to expand or undertake new projects.Active Participation: Actively participate in the cooperative's activities and contribute your skills and expertise. Attend general meetings, join committees, and offer your input in discussions and decision-making processes. Engaging with other members and sharing your knowledge and experiences helps strengthen the cooperative and promotes a culture of collaboration.Cooperative Promotion: Act as an ambassador for the cooperative by promoting its products or services to your networks and the broader community. Encourage others to join the cooperative and support its mission. Word-of-mouth referrals can be a powerful tool in expanding the cooperative's customer base and building its reputation.Support Cooperative Initiatives: Cooperatives often undertake various initiatives and projects to benefit members and the community. Support these initiatives by participating, providing feedback, and volunteering your time and skills when possible. Cooperatives rely on member support to implement and sustain initiatives that contribute to their shared goals.Continuous Learning and Improvement: Stay informed about cooperative principles, industry trends, and best practices. Actively seek opportunities for education and training to enhance your knowledge and skills, which will benefit both yourself and the cooperative. Embrace a mindset of continuous learning and share your knowledge with fellow members.

By acting as an engaged and supportive equity shareholder, you contribute to the cooperative's success and help fulfill its mission. Your active participation, financial support, cooperative promotion, and commitment to continuous improvement strengthen the cooperative's foundations and create a vibrant and sustainable cooperative community.

Scholarships

©Center for Sustainable Action aims to build a sponsorship pot of money (£10,000) to allocate to our scholarship program. This will be considered a ‘running cost’ of the cooperative so will not affect the ‘Equitable Formula’ shared above.

This scholarship(s) will be available to ‘active’ members who apply for it to help their business implement a sustainable change, as a member ©Center for Sustainable Action will support you with advice about the change and how to verify that it is indeed sustainable.

The Application Process will be designed cooperatively for-the-members-by-the-members so please let me know if you would like to be part of crafting this.

‘Active members’ are as described above in ‘Time Weighted Factor’ and in ‘Membership Commitment’ section above.