What responsibilities do co-op members have?

I want to tackle today what I think is quite a difficult question.  It’s this:  what responsibility do ordinary members of a co-operative have, if their elected directors are not making a very good fist of things in terms of governance and member democracy?

A little while back (and for obvious reasons I’m going to be imprecise and will be fictionalising some things) I went to the AGM of a co-operatively run organisation I’ve been a member of for some time. It has around 6000 members and it operates in the area where I live: let’s imagine that it’s a locally-based consumer co-op.

The AGM pulled in perhaps twenty-five members, if you include the directors and one member of staff who was there. So at least we just met the quorum, which was sensibly set very low.  You can do the sums: about 0.05% of the members were there.

We were given refreshments beforehand, perhaps as a not-very-effective bribe to try to persuade more of us to attend, and then we began the formal business.

The accounts (handed out as the meeting started) did not look good and no dividend was possible, but there were perhaps one-off reasons for this. Every co-op can have off years. But more than this, there was a sense of an organisation struggling to get to grips with governance. The chair has been in post for almost as the organisation has existed and he dominated the meeting, including barging in in the middle of the treasurer’s report. He, and two other directors, were re-elected to the board in an uncontested election.

I asked some questions, trying to strike the difficult balance of being a responsible member asking necessary questions while at the same time showing that I supported the voluntary board and appreciated their efforts. A few other people asked some questions but mostly we listened.

So what responsibility do I have, and what responsibility do my fellow members have? I could of course put myself forward for the board, but I am already actively involved in several other co-op and community ventures and frankly this doesn’t seem like a priority for me. So if I rule myself out in this way from engaging directly, is it enough just to turn up once a year for the AGM?

Unfortunately I am prepared to predict that next year’s AGM will be almost a re-run of this year’s.

Co-operative heritage in the Pennines

There’s a cold easterly wind blowing over my part of northern England today and Spring, let alone Summer, seems a long way away.  But here’s some very early news of an event I’m organising on the UN’s International Day of Co-operatives, Saturday July 7th.

The small mill town of Hebden Bridge, between Leeds and Manchester in the south Pennines, has a strong co-operative history, part of which I recounted in my book All Our Own Work which tells the story of the highly successful worker-run co-operative textile mill in the town which ran from 1870 to 1918.  I have persuaded myself to run a Co-operative Heritage Walk in the town on July 7th, starting at 11am at the Tourist Information Centre.

The walk will last about two hours, and I think we’ll have to end it firmly in the twenty-first century, in the town’s co-operatively run pub, the Fox and Goose.  More info nearer the time.

Who are the wealth creators?

Last Friday’s Ways Forward conference in Manchester, organised by Co-operative Business Consultants (or to be accurate, organised more or less singlehandedly by CBC’s hard-working Jo Bird) was the sixth such event in what is becoming a regular feature in the co-operative activist’s diary.

Two speakers particularly impressed.  Both reminded their audience of all that’s wrong with the present economic system – and why, as at least one way forward, co-operative business models need to be nurtured. Molly Scott Cato (the Green Party’s MEP for the South West) stood in as a speaker at short notice and offered a robustly radical appraisal of the issues facing us, while leaving us at the end of her contribution with a sense of hope.

Rebecca Long Bailey, Labour’s shadow Treasury spokesperson, is an articulate and passionate political speaker who is becoming a regular at the Ways Forward events. She was in fine form on Friday. The text of her speech has come through to me, and I will offer here just one short extract:

“Our co-operatives embody a forgotten truth about the world: wealth is created collectively, not by some small minority group but by workers, the community. Sadly when we talk about wealth creators however we don’t mean those people who created the wealth in the first instance, it usually means the wealth controllers and the wealth owners. But we know the reality is that the resources of our world are created collectively and we want that to be reflected in the way our wealth is owned and managed, and that is why we are dedicated to expanding the co-op sector and making sure that in the future we all feel that we have a real stake in our economic future.”

Public ownership and the Labour Party – and please don’t use the ‘n’ word

I’ve blogged before about the debates which took place towards the end of the nineteenth century – in the co-op world, in the trade union movement and in the fledgling Labour political movement – about business models which could be used to ensure that key enterprises like the railways were run for public good, not private profit.

It’s good to see these debates gaining traction again today. Over the weekend at the Labour Party’s Alternative Models of Ownership conference in London both Labour leader Jeremy Corbyn and shadow Chancellor John McDonnell set out their own thoughts on how a future Labour government would tackle this.

Corbyn in particular was clear that Labour would be looking for new forms of public ownership based on accountability to workers and users: “not a return to the 20th century model of nationalisation but a catapult into 21st century public ownership,” as he put it.  (Despite this, if rather predictably, the CBI responded with scare tactics based firmly on the use of this particular ‘n’ word.)

The conference last weekend follows on from the publication of a report, also called Alternative Models of Ownership, written by an external advisory group for the Labour Party and published last summer. Perhaps because of the General Election, this report hasn’t had the attention I think it deserves. I think its critique of state nationalisation is spot-on: “Older forms of national state ownership in the UK have tended to be highly centralised, top-down and run at arm’s length from various stakeholder groups, notably employees, users and the tax-paying public than ultimately funds them. The post-1945 nationalisation programme set the trend here… the result was that a small private and corporate elite – in some cases the same people who had been involved in managing the pre-nationalised private sectors… – ran and oversaw the nationalised industries”.

The debate over how we can create new forms of public ownership is a vital one, and clearly needs input from the co-operative movement. I think there are challenges ahead (trade unions themselves have nasty tendencies to be very centralised and top-down, for example, and not every co-op is a paragon of democracy).  But the task of developing new, public-focused, democratic forms of business model is the issue of the day.

Taking stock at the Phone Co-op

Co-operative democracy, as I predicted, was much in evidence at the Phone Co-op’s AGM in Sheffield on Feb 3rd.  There’s a good report of the event on Toby Johnson’s blog the link to which has been up here on a comment but which I’m mentioning again in case you’ve missed it.

The Phone Co-op’s (rather beleaguered) Board has appointed Jane Watts as their chair, someone whose strong record in the co-operative movement should help steady the ship. The Board has also moved quickly to call a Special General Meeting on April 28th, a smart move since if the Board hadn’t done this themselves then dissident members would probably have called for one anyway.

It’s still not clear to me whether the Phone Co-op’s strategy for growth – which involves considerably more risk than its way of operating in the past – is rooted on a strong business case or on over-optimism from the Board.  But at least all members are being encouraged to scrutinise the proposals carefully. The Phone Co-op remains one of the modern jewels of the co-op movement in Britain and needs to be looked after carefully.

Phone Co-op correction

Let’s try to be accurate in these blogs, shall we Andrew?

The motion I mentioned in my blog a moment ago is from Simon Blackley, not Toby Johnson as I said.  (Toby has put forward a separate motion, on income differentials and CEO remuneration, which is also a significant issue for discussion).

Tut tut, this blogger is supposed to be a professional journalist…

Questions to be asked at the Phone Co-op’s AGM

The Phone Co-op’s AGM in Sheffield on Saturday February 3rd looks set to be an important occasion for the exercise of co-operative democracy and member participation.

I blogged more than a month ago about the Phone Co-op, one of the jewels in the modern British co-operative story. Vivian Woodell, who was the co-op’s Chief Executive since the start of the venture, stepped down during 2017 in circumstances which are, it has to be said, opaque.

As I said in my blog, “For any business, the resignation of a key person is a moment of greater uncertainty and risk.  If the Phone Co-op were a plc and not a co-op, institutional investors would by now have been interrogating the Board in detail to find out exactly what the strategy for the future would be – to see if really the Board knew what it was doing.”

I’m not sure that I know what the Phone Co-op’s Board does plan for the future. There is upbeat rhetoric in the documents I’ve received of increasing profits to £2m in 2021-22, but there is also talk of losses in the interim. I’m not sure I’ve been persuaded that the £2m figure is anything other than wishful thinking.

It is now clear that other members of the society share my uncertainty. There is a long, and important, motion for the AGM proposed by Toby Johnson which interrogates in detail the information the Board has supplied and asks among other things for the Board to specify at the AGM “the upper and lower limits of the range of projected profits and losses for each year of the 4-year strategy, and the assumptions underpinning these projections.” I think members would be well advised to support Toby’s motion.

The Board (who are of course elected Phone Co-op members who receive only a very small allowance for their role as non-execs) may at this stage be feeling a little beleaguered.  They shouldn’t feel this. Member engagement (in the way that Toby Johnson’s motion is doing) is a positive advantage of the co-operative business model. It means that it is more likely, not less, that the co-op follows a strategy which will allow the business to prosper. Any Board of a co-operative that understands the way to tap into the experience and good sense of all its members is a Board that is demonstrating confidence, not weakness.

We’ll have to see what happens in Sheffield.  It’s very unfortunate that the date clashes with another commitment I can’t avoid, but I hope that he meeting is well-attended, that members ask probing questions, and that the Phone Co-op is as a consequence set on a firm footing for the future.