My series for the Guardian on the theme can coops compete? comes to an end today, with the final piece now published (here). It’s about the often tetchy relationship between coops and capital.
As you’ll see, I begin the piece with a quote from coop pioneer George Holyoake who wrote in 1878 that “Capital is like fire, or steam, or electricity, a good friend but a bad master”. The problem of capital – as we saw last year when the Co-operative Bank had to nuzzle up to the hedge funds – remains as acute today as in Holyoake’s time. How do you satisfactorily defend member self-determination in cooperatives when investors are there as well, wanting their share of the cake? How do you fill the capital gap, if you can’t access equity? (Is the – highly controversial – answer in fact to accept investors as fellow-stakeholders in the business and devise a multi-stakeholder coop model which gives them membership rights too?)
I’ve felt for a long time that the big issue facing the cooperative movement at the moment is this one of capital, and I’m pleased that the International Co-operative Alliance has recognised this in its strategic Blueprint for a Co-operative Decade. I’m currently playing a small part in relation to a UK working party that’s exploring capital solutions internationally for cooperative banks and insurers, which we hope will feed in to the ICA’s recently established ‘Blue Ribbon’ commission on capital.
The Guardian piece explores some of the possibilities around member-provided capital. And I also float the idea that cooperatives need to develop financial instruments to tap into the growing pool of ethical/socially responsible investment capital, most of which (ironically) currently finds its way into plcs.