Business Columns & Blogs

Doing Better: NC’s co-ops, credit unions crucial to state’s economy

As we strive to create new models of economic opportunity and wealth creation in North Carolina, the age-old cooperative model is a viable place to look.

From the early Greeks to Native Americans, people have found ways to cooperate with one another for economic survival. Hunters cooperated with the gatherers. Farmers relied on one another to defend land, harvest crops, build barns and share equipment. And as people started moving from farms to cities during the Industrial Revolution, a new form of cooperation emerged.

Frustrated by their dependency on company stores to feed their families, especially as the company store owners exploited their monopoly through price gouging, communities started experimenting with their own stores. After a failed strike in 1843, 28 workers in the textile mills of Rochdale, England, launched what was heralded as the first economically viable co-op in modern industrial times. Rochdale Equitable Pioneers Society, as they called it, crafted important operating principles that became the bedrock of cooperatives globally.

These principles include: voluntary and open membership regardless of background; democratic member control; equal and democratic economic participation; autonomous, self-help organizations controlled by their members; education for members so they can contribute effectively; cooperation among cooperatives; and concern for community.

Credit unions

Founded on these principles, cooperatives have become a crucial part of North Carolina’s economy. North Carolina’s 26 electric cooperatives, for example, serve more than 2.5 million people in 93 counties and employ 2,300 skilled workers. Their $5.8 billion in assets are owned by their customers – 99 percent of whom are residents and small businesses.

Credit unions are also part of our state’s economic backbone. Concerned that Tar Heel farmers were suffering from exorbitant loan interest rates, Durham banker John Sprunt Hill and newspaper editor Clarence Poe persuaded the General Assembly to pass the Credit Union Act in 1915. By 1950, there were more than 200 credit unions in the state, a quarter of which were African-American owned.

Today, North Carolina is home to some of the most dynamic credit unions in the country. The Center for Community Self-Help, based in Durham, is one of the largest community development financial institutions, or CDFIs, in the country, with over $5.5 billion loaned to our most vulnerable populations.

The Latino Community Credit Union, also based in Durham, is one of the fastest growing CDFIs in the country, with 11 branches across the state and 55,000 members – 90 percent of whom are low income and more than half of whom did not use any banks.

The State Employee Credit Union, owned by more than 1.9 million state and public school employees, has branches in 255 locations statewide with 5,000 employees providing basic banking, mortgage financing and car loans, as well as helping with more than 90,000 tax returns through the Volunteer Tax Assistance (VITA) program. The member-funded SECU Foundation also contributed $15 million last year to education scholarships, hospice care and a new SECU Family House for families of seriously ill patients in UNC Hospitals.

Entrepreneurial spirit

Looking forward, cooperatives can play an even bigger role in accelerating local business ownership and community economic development in low income communities. A great case study of this is the Evergreen Cooperative Initiative in Cleveland, Ohio, which is working in six communities with a median household income below $18,500. With a strategy of building local wealth by catalyzing new businesses owned by their employees, Evergreen has launched Evergreen Cooperative Laundry, GreenCity Growers Cooperative and Evergreen Energy Solutions, which installs solar panels on residential and commercial buildings.

More locally, Fertile Ground Food Cooperative in Southeast Raleigh is seeking to foster the community’s entrepreneurial spirit through collective ownership. Tangerine Clean in Durham and Chapel Hill is a cooperatively owned cleaning company committed to creating a “better, more sustainable world.” Opportunity Threads is a worker-owned cut-and-sew company in Morganton with a vision to “build assets, pay fair wages, and retain and grow capital in our local communities.” Renaissance Community Coop in Northeast Greensboro is working to launch a community-owned grocery store in a current food desert. And the Durham Co-op Market just opened its doors.

On April 9 and 10, the Solutions Generator Network is hosting a round table discussion at the Center for Responsible Lending in Durham focused on building equity and ownership capacity in low-wealth communities – including a new initiative called project LEAF that aspires to launch a worker-owned cooperative to fulfill contracts with anchor institutions such as universities and hospitals.

Efforts like these to create more business ownership opportunities across North Carolina are crucial to our future – especially in our more economically distressed communities. Fortunately, we have a strong foundation already. Let’s keep building.

Christopher Gergen is CEO of Forward Impact, a fellow in Innovation and Entrepreneurship at Duke University, and author of “Life Entrepreneurs: Ordinary People Creating Extraordinary Lives.” Stephen Martin, a director at the nonprofit Center for Creative Leadership, blogs at They can be reached at and followed on Twitter through @cgergen.