Cooperative legal specialist Ian Snaith has raised the interesting argument in his blog that the continued use of the name Co-operative Bank, once it ceases to be majority owned by the Co-operative Group, could be legally questionable.
UK, European and international law sets out criteria as to what constitutes a genuine cooperative. Ian’s view is that a plc which is only 30% owned by a cooperative body does not meet the criteria. He also suggests that continued use of the name would be unethical.
He concludes his detailed review of the law with the comment: “The new owners are welcome to choose a new name that expresses their ethical intentions and brand. There is no problem about making the bank sound “cuddly”. They can have an “ethical” board to try to keep the brand’s image. They can amend the Articles of Association. They must not say that it’s a co-operative when it isn’t. That is disreputable.”
There’s another interesting question linked to this. The International Co-operative Alliance meets next week in Cape Town when it will adopt a new global brand for genuine cooperative businesses. The logo, which is based on the letters COOP with the middle two letters interlocked, is intended as a universally recognisable way for the public to know that they are dealing with a business which meets the agreed international cooperative values and principles, including member ownership and one member one vote. Will the Co-operative Bank in its new ownership form be able to use the brand? Logic would suggest that it won’t.