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.

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2 thoughts on “After a bone shaker of a week – 3 things to remember

  1. “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.”

    Surely, its because the Co-op is supposed to be different, that should lead us to question seriously more than just the question about what went wrong in this particular case. Some time ago, I wrote a review of Nicole Robertson’s book on the history of the Co-operative Movement. She points to a statement by G.D.H. Cole about the danger for the Co-op of being dominated by small groups of people. I think that this is precisely what has happened with the Co-op Group and Bank, and it is a structural weakness of member co-ops compared to worker owned co-ops.

    I think its a travesty that the Co-op Bank is going to end up being in the clutches of private financiers. I thought that the merger with Britannia was a good idea, and in fact I have always thought that bringing in the Nationwide, Unity Trust and other Mutuals would be a good idea. But, I think that such a Co-op needs to be owned by its workers, even if it has to have a working relation with the rest of the Labour Movement.

    Particularly, as member owned Co-ops get bigger, the material basis for those members having any long term affiliation to it, let alone commitment to participate in its running diminishes. That means as Cole suggests that they can become dominated by small cliques, including those around the existing management.

    Its time the Labour Movement took things in hand. The Co-op should be converted into a worker owned Co-op. We need to establish an effective Co-operative Federation preferably across Europe as a minimum under which all Co-ops should be brought, and which can act to provide the necessary financing, as well as act as a prevention of demutualisation.

    The TUC should with the LP participate in this process. We should also have a campaign via all these arms of the Labour Movement to get control of workers pension funds, so that the approximately £800 billion of funds become available to use to convert other firms into Co-ops, and to ensure the adequate capitalisation of all existing Co-ops. In fact, my preference would also be for a gradual move to reclaim all of the money paid by workers into National Insurance and taxes to cover welfare provision, so that we can establish co-operative provision of that via worker owned co-ops, working with member owned commissioning co-ops, based in each neighbourhood.

    Rather than seeing the last week as a reason to be on the defensive, the proponents of co-operation should go on the offensive.

  2. Pingback: Getting perspective on the Co-operative Bank | Seeds beneath

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