After a bone shaker of a week – 3 things to remember

OK, it has been the worst week for the co-operative sector for a long time – a real bone-shaker for those of us involved. Our movement is in the spotlight to an extent we’ve rarely experienced before but so far this light has not been kind, or illuminating of the true strengths and successes of co-operative and mutual enterprises.

I have appreciated the many messages of goodwill. Alan Middleton, passionate advocate of good governance in coops, reminds me that sometimes it is not the system that messes up, but people. We have had that in spades with the clown antics of the former Bank Chair.

David Button, behind many a successful agricultural cooperative, was in touch to say “obviously this is a personal tragedy to individuals but this should not overshadow the whole movement and the essential and fantastic work that is being done by co-operatives across all sectors in the UK and in the world. If ever there was a need for an independent organisation, speaking for the whole movement and with a rational approach to key issues it is now and of course it exists as Co-operatives UK and thank goodness it does.”

The three things that might get lost in all the noise and that seem to me to be worth fighting for are:

1. Despite the focus, there are many, many great coops (over six thousand) across the economy – and with support from across members of all political parties and none.

2. Looking forward, there is an entirely new leadership team in at the Co-operative Bank and the wider Co-operative Group, with hopeful vision and ambition. The new Group Chair, for example, is an outstanding co-operative business leader, Ursula Lidbetter, with a proven track record.

3. The future still seems very positive. This week, Co-operatives UK held a Pop-Up Thinktank on co-operative innovation with leading economists and business specialists from across the UK. Worldwide, the co-operative sector has a turnover 54 times the global turnover of Coca-Cola. We are confident about business ahead.

Many co-ops come out of adversity so perhaps new challenges create new strengths. I hope so. One of the co-operative values is responsibility and we have to take responsibility for what went wrong, as well as what should now happen. The challenges of the Co-operative Bank will lead to some deep learning.

It may be that, as the Financial Times suggested this week, the Co-operative Bank didn’t get into trouble because it was a co-operative, and therefore different, but because it was a bank – but still sadly no different to the others. Apparently, there is a word for that, the academics tell me – isomorphism.

We are businesses that aim to be different and we certainly don’t expect to be immune to stretch and stress. But I look forward to the focus moving back to participation, service and value for the fifteen million member owners of thousands of effective co-operative enterprises across the UK.

What’s missing in the debate on the NHS? People.

The announcements this week on improving care and patient dignity in the NHS are welcome, but the one set of people that seem to me to be missing from the framework is the public.

There are over two million members of NHS Foundation Trusts. They ought to be a bedrock on which a participatory NHS can be built – after all medical professionals are expert on medical treatment, but patients are expert on what care and dignity feels like when receiving that treatment.

It is ten years ago to this week that the Act creating Foundation Trusts came into force. I was involved at the time, advising on the framework for participation. So I have put together a short report, Ten Years After, reflecting on progress over that time.

In reality, the role of membership in Foundation Trusts, as they have widened, has become more token. There are some exceptions, not least in the mental health field, just as there are exceptional health mutuals outside of the NHS. Worldwide, 300 million people are covered by health coops and mutuals. Membership is something which all mutuals have to focus on and I set out some practical recommendations which could help to restore some of the more active role for members that was core to the original vision.

There is more to do to create a health service based on genuine mutuality between the professionals and the public.

Over six thousand co-operatives and growing

For all the troubles that have hit the Co-operative Bank, as earlier with other banks, there are over six thousand co-operatives across the UK, owned in turn by 15.4 million people.

Co-operatives are businesses that are owned by the people that are involved in the everyday life of the business. One new co-operative starts every working day.

The survival rate for new co-operatives is also far higher than for business at large. One in three conventional businesses goes out of business within three years of starting. For co-operative enterprises, that is only one in twenty.

For five successive years the co-operative sector has outperformed the UK economy, growing by 20% since 2008. Across the nations of the UK, our turnover is now £36.7 billion. Worldwide, the co-operative sector has a turnover 54 times the global turnover of Coca-Cola.

Examples of this commercial success story are:

  • In farming, 65% of all farmers in Scotland, an expanding sector, are now members of an agricultural co-operative.
  • Co-operative schools have doubled their number every sixteen months, with now over 500 co-operative schools in England.
  • There are now one million members of credit unions in Britain. These are financial co-operatives, lauded most recently by the Archbishop of Canterbury, who asks all churches to work with their local credit union.
  • Co-operative Energy is challenging the big six retail energy giants. The percentage of UK consumers who would recommend their energy supplier is 30% overall but an amazing 97% for Co-operative Energy.

It is a strength of co-operative businesses like this that they benefit by being more inclusive. For example, 37% of directorships are held by women in co-operatives, compared to 13% of leading companies.

We are in tough competitive markets and we use our co-operative model as a source of competitive advantage.

Co-operatives benefit from high levels of customer and workplace loyalty. They give a voice to employees and customers, creating space for their ideas for product and service innovation.

Research comparing co-operatives shows that the more participatory the business is, the more productive it is.

There are over six thousand co-operatives in the UK and we are still confident, savvy and growing.