The lurking danger of demutualisation

Vivian Woodell, the chief executive of the Phone Coop, has sent me an email link to a recent article in The Australian.  It begins, “The nation’s second-biggest wheat exporter, CBH Group, is facing calls to abandon its co-operative model amid rising investor interest in the agribusiness sector, with estimates that corporatisation could unlock $5 billion in value for more than 4000 growers.”

In fact, I understand indirectly from the Australian cooperative movement that this story comes from a Murdoch-owned newspaper trying to stir things up.  It’s good to know that there are many who believe CBH should stay resolutely cooperative.

Nevertheless, demutualisation – which has caused such problems in Britain over the past twenty years –  remains a worldwide threat to the cooperative movement, and one which needs to be tackled head-on.  This is yet another reason for the importance of discussing new capital instruments for coops.

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