The co-operative movement started and grew on the awareness of a community group consisting of those who were exploited or oppressed to defend their plight and fight for their rights in life. The history of this formal movement began in the 18th century at the onset of the Industrial Revolution in England. The birth of industrial figures such as Hargreaves (inventor of the spinning jenny), Richard Artwright (inventor of the water frame using waterpower), Samuel Cromption, James Watt (inventor of the steam engine) and Edmund Cartwright (inventor of the power loom) had encouraged the growth of industrial towns. This development had attracted many workers especially from the agricultural sector that were being exploited by landlords to change directions and work in the industrial sector. Employment transformation from agriculture to the manufacturing sector had led to factory owners taking the opportunity to exploit the influx of labour with low wages, long working hours and distressing working facilities and conditions.

This scenario was exacerbated by the political atmosphere at the time whereby the government was controlled by the wealthy landlords and factory owners. Most of the policies enacted were in favour of these plutocrats and indirectly oppressed and exerted pressure on people’s lives. An example of such discrimination was when in 1815, the Parliament of England approved the Corn Law which prevented the importation of corn. The drafting of this law led to a sharp hike in bread prices and indirectly causing a very high level of poverty among the people.

The pressure and bad situations faced by the people especially among factory workers had forced them to find a way to overcome the problem. This was when Robert Owen (1771-1858), known as the “Father of Co-operatives”, emerged as the generator of ideas to the modern co-operatives to reduce the effects of injustice and oppression at the time. As someone with a background of being a factory worker, then rising up to become an entrepreneur and eventually owning a textile factory, later becoming a community leader, he realised the needs for a community system that is more dynamic and gives fairer treatment to workers. He aspired to establish villages across the country called the New Moral World to replace the current life conditions which he considered infested with corruption and oppression. With an ideology or belief that regards it necessary to create a co-operative community first and then followed by activities or businesses, he established a village based on the principles of fraternity and co-operation (Villages of Co-operation in 1799) and an Institution for the Formation of Character in 1816, both located in New Lanark, Scotland, and a co-operative village in Hampshire, England (1893). Although Robert Owen’s efforts failed, but his idea with elements of co-operatives had influenced a number of people and paved the way towards the creation of a more systematic Co-operative Movement.        

Efforts to continue this Co-operative Movement also gained the attention of a local academician and author, Dr. William King (1786 - 1865). In 1828, Dr. William King published a monthly bulletin titled “The Co-operator”, a publication deemed successful in spreading new spirits and understanding in co-operative activities among the people of England at the time. “The Co-operator” bulletin successfully published 28 editions through a course of three years from 1827 to 1830. This bulletin, with its concepts of co-operatives through practice and values of Christianity had spread throughout England to the extent that whenever the bulletin had reached a locality, a co-operative would eventually be established in that area. The first co-operative sponsored by Dr. William King was Brighton Co-operative Trading Association in 1827, but sadly this co-operative was also doomed for failure.

Developments of the co-operative movement by the two figures stated above were unable to bear the fruits as desired. This happened not only because this co-operative movement arose in the Industrial Revolution era, but failed when the principles of fraternity and helping one another in increasing the socio-economy of the community was not fully appreciated by its members. In fact, the dependence of its members in gaining assistance and help by focusing on certain individuals and leaders only furthermore contributed to the failure of this movement. Apart from having no recognition of its status legally, the lack of business knowledge among its members, the lack of support from the plutocrats and greed of its own members which dissolved co-operatives to become private companies were also among the causes of the downfall of this first co-operative movement.

The co-operative idea was subsequently adopted by artisans whereby 28 weavers had agreed to contribute a capital of  £1.00 each through the establishment of Rochdale Pioneers Society Limited in 1844. The group, also known as the Rochdale Pioneers, had outlined the co-operative principles which was later recognised as the Co-operative Movement philosophy worldwide. With an accumulated capital of £28.00, on 21 December 1844, they established the first ever consumer co-operative store in the world through approaches of sales based on the market, buy and sell in cash and dividing of profits based on the number of purchases made by members. Within just a few years, this co-operative had achieved great success in aspects of membership, capital and its business. It is from this success that the co-operative movement began to grow throughout England and later all over the world including Malaysia.