A cooperative provides the economic dimension without which fishing community development is powerless to effect structural changes.
The word ‘co-operate’ means ‘work together’. The idea of working together is the underlying principle on which the cooperative movement is based, but, in its special, technical sense, the word 'co-operative is narrowed down to mean a formal, legally-established organization with a continuing existence based on the principle of working together. A cooperative is a business organization run for mutual benefits of a group who have common interests in accordance with cooperative principles. These principles, as most recently formulated by the International Cooperative Alliance include:
Voluntary and open membership;
Democratic control on the basis of one member, one vote;
Limited return on share capital;
Distribution of profits either collectively or in proportion to members' participation in the economic activity of the cooperative;
The promotion of education;
Collaboration with other cooperative organizations.
Membership of PN is open to all who can benefit from it, if they are eligible. There is no artificial restriction or exclusion. However, no one is allowed to be a member of more than one PN. Members shall withdraw from PN upon occurence of any of the following events:
voluntary withdrawal;
loss of the qualifications for the membership;
death or dissolution;
expulsion.
Private companies relate control of the concern and distribution of the profit to ownership. The larger the capital shareholding the greater the voting power.
In a cooperative like PN neither member control nor member dividend is based on ownership. All the members of PN, irrespective of social status or wealth, are equal to one another. PN is governed by a general meeting, which all members have the right to attend and at which each member is entitled to only one voting right and one election right of officers and representatives of PN. The general meeting elects the members of the Board of Directors to supervise the running of PN.
Although PN is not a profit-seeking body like private enterprise, it is essential that PN should generate profit through its economic activities. In principle, the profits of the economic activities of PN are reinvested collectively for new projects or expansion or repair of existing infrastructure, so-called social dividend, rather than being distributed to individual members. However, when PN makes sufficient profits, its surplus should be returned to the members in the form of a dividend. In order to attract share capital from its members, PN should try to make it possible to pay a rate of interest competitive with that obtainable in saving bank deposit and the like. The return to share capital is fixed and does not vary with the “profitability” of the business. The maximum payable should be prescribed by the constitution of PN. The principle is that the members should be rewarded for investing in the PN, but not to the extent of profiteering. Both a social dividend and an individual dividend would be an effective means of building support and membership and establishing influence in the fishing community.
After making allocations to reserves and after paying the limited interest on share capital, the trading surplus is distributed according to the member's contribution toward the surplus - in proportion to sales and purchases. This principle has the double advantage of being fair and of encouraging the member's loyality to their PN.
Members of PN must support their PN and use their vote wisely to control it. They therefore need to understand the principles, structure and function upon which PN is based and how it works. So education for members is important. PN is a business organization serving the economic interests of its members. To do this, it has to be done efficiently. So education for the chairman, the members of the board of directors, managers and staff is important. PN must use all possible means to provide their members with educational and training programmes. Education influences not only their ability but also their motivation. Thus, member education has the important job of developing awareness, values, motivations, and linking them with the commercial progress of the movement. But in many PNs the education service does not establish this linkage. Education, social activities and economic business are all too often treated as separate compartments.
There is considerable scope for mutual benefit through the increase of collaboration with other cooperatives, locally, nationally and internationally. In other countries, there have been instances where fishermen's associations have entered into mutual assistance arrangements with agricultural cooperatives to exchange the products (i.e. fish versus agricultural products) with reduced prices. Chances for establishing such collaboration may arise as PN increases its surplus and consolidate their business strength.
From the preceeding paragraphs, it is now clear that PN is an association of fishermen, usually of limited means who have voluntarily joined together to achieve a common economic end and upgrading of the living conditions through the formation of a democratically controlled business organization, making a suitable contributions to the capital required and accepting a fair share of the risks and benefits of the undertaking.
To be more precise, the ‘fair share’ of risks and benefits is achieved by the manner in which the capital is raised and the profits distributed. In other words, the liability of a member are limited to his own contribution and debts. Every member is required to contribute a minimum sum in share capital, entrance fee and annual subscription. The amount of contributions differs according to locality. For example, PN in Tumpat, Kelantan collects M$5 as the contribution to share capital, M$5 as the entrance fee and M$1 as the annual subscription, which totalling M$11 when a fisherman is enrolled in PN. No member is allowed to hold more than one-fifth of the share of any PN.
PN is owned by its members, and membership is open to anyone who reside in the area of operations of PN and who has attained the age of 18 years if he/she meets the following conditions:
Full membership
individuals who are engaged in catching, harvesting or the culture of aquatic organisms (either on their own account or as employees) more than 120 days per year;
a fish processor, handler or dealer;
individuals who derive 60 per cent or more of their total income from occupations related to the fishing industry.
Associate membership
The following persons are eligible for the associate membership of PN. Individuals who conduct research on or is engaged in the development and improvement of the fishing industry. Associate members must pay contributions and have voting rights. However, they do not have election rights.
PN will carry out the following activities for the benefit of the members;
to provide the marketing service possible for orderly and advantageous distribution and sale of all products from the the marine, brackish and fresh water;
to supply to the members of commodities required for their business or living;
to assist the members in obtaining official credit from banking institutions;
to provide facilities for joint use by the members for their business or living, such as health centres, nurseries, thrift institutions and other welfare programmes;
to act as an intermediary in matters relating to the fishing boat insurance and accident insurance;
to organize member participation in any conservation programmes directed by DOF in order to increase the value of fishing grounds.
to promote member education and training to improve their business management, fishing and aquaculture techniques and knowledge regarding the role and activities of PN.
