Taking everything into consideration…

Having filed my piece on the Co-op Bank, I belatedly get round to tackling the day’s post… only to find it includes a request for me to complete a standard customer survey form sent from a company called Optimisa Research on behalf, yes, of the Bank.  

It includes the question “How likely is it that you will still be a customer of The Co-operative Bank/Britannia in 12 months time?”, the choice ranging from ‘Not at all likely’ to ‘Very likely’, with another proffered option being ‘Don’t know’.

Good (or perhaps bad) timing, guys.  That really is the question of the day.


More on the Co-op Bank

It looks as though the Co-operative Group has lost the battle to retain majority ownership of the Co-operative Bank.

This is one of the most significant developments within the British coop movement for many years, and unfortunately it is not good news.

My news piece on this, including my assessment of the implications for the cooperative movement as a whole, is now up on the Guardian’s social enterprise website.  You will also be able to access it, and previous writings by me on both the Co-operative Bank saga and on the broader issues of where coops go for the capital they need, on my website, http://www.andrewbibby.com/coops.html.

Doing my bit for democracy the cooperative way

I mentioned that I was at my local Co-operative Group area members’ meeting yesterday.  I want to return to this subject, because meetings like these – for all their problems – are worth some discussion.

The Co-operative Group has seven million individual members, so not surprisingly its governance structures are complicated.  It has of course an overall Board of Directors, the Group Board.  It then divides the country into seven Regions, and forty-eight areas.

As coop members, we elect the members of our local Area committee.  They in turn decide who will be members of the seven Regional Boards.  And (hopefully) the best and brightest from the Regional Boards end up being elected on to the Group Board, which has the task of strategically managing a £13 billion business on behalf of us all.  (Confused?  The details are on the Group’s website here.)

Individual members’ interface with the Group’s democratic structure comes in the annual Area Members’ meetings.  If you go along, you will normally have the chance to put your views to a Group Board member, to other elected members at regional and area level, and to senior regional management.  You’ll probably be rewarded with the chance to snack on some Co-op goodies.

Our area meeting began with a comprehensive overview of the Group’s recent trading performance.  It was not, of course, a comforting story:  as well as the Co-op Bank crisis, almost all parts of the sprawling Group business empire saw sales fall in the first half of 2013 compared with 2012 (only funeralcare has improved its turnover: I hope there isn’t a moral there).  The presentation was – as you would expect – carefully scripted (and partly in video form) but competently done.  This was exactly the sort of report which you would want the directors and senior management of any coop to be providing to its members.  Poor trading results, perhaps, but full marks for telling it straight.

Of course, when we got to the Q&A session later on the members present turned out to have other things on their mind than trading exigencies.  We asked questions, among other things, about first aid training for employees, Costa coffee machines in Co-op stores, grants to the Woodcraft Folk and Co-operative Women’s Guild, and the concept of junior coop members.  (We also discussed the tie-up with Amazon, but I’ve told you about this already). No-one proffered strategic advice on how to fill a £1bn+ capital shortfall – but that’s what the Group Board is elected to worry about.

There were perhaps fifty in the room.  Take away the Co-op Group staff organising the event and the regional and area officers, take away as well the people who turned up to be given Community Fund grants, and you were left with an audience of perhaps fifteen.  And a lot of these were, as they say, familiar faces.

So is it worth it?  Actually, I think it is. The Co-op Group may be struggling to face up to its competitors but it does have the one potential strong advantage of being structured as a member organisation and not one answerable to shareholders.  Of course,  the Group has a long way to go to make its ‘members’ understand that there are, indeed, members.  But this has to be its strategy: if it can get closer to its membership and listen to what they say they want, it could start getting those business decisions right after all.

Snuggling up to Amazon

Why, someone in the audience wanted to know, is there a row of Amazon lockers in their local coop shop?

I was at an area meeting yesterday of the Co-operative Group, the place where ordinary members (you know, those of us with the yellow membership cards who collectively own this coop of ours) can have our say and ask questions of senior(ish) Co-operative Group elected members and staff.

The answer that came back from the platform is that the Amazon link-up is a pilot, a way of exploring whether people who pick up their Amazon deliveries after work may perhaps also stay to pick up, say, a Truly Irresistible coop ready-meal (and, who knows, some premium-priced sun-dried tomatoes, guacamole and stuffed olives) for their evening meal.

…although, to be fair, the members of the platform did look embarrassed when the question was posed.  There is, I’m afraid, no plausible answer to the question of why the Co-op Group is snuggling up to a global giant with a propensity for clever tax avoidance schemes and a reputation for being anti-union in its employment practices.

Talking of Amazon, are you thinking of buying a book soon?  There’s always Liverpool’s venerable workers’ cooperative bookshop News from Nowhere. They do mail order.

When cooperatives get complicated: do multi-stakeholder coops work?

Can coops work as coops if they have different classes of membership?

Could for example a retail cooperative be structured with two types of membership, one open to its customers and the other to its workers?

Or could a workers’ cooperative invite its supporters to invest in the business and give these investors membership rights?

The answer to both these questions is yes.  Mondragon’s retail arm Eroski in Spain provides a classic example of the first arrangement (customers and workers each have equal stakes in the coop’s governance) and for a forthcoming UK example we can turn to the Midlands cooperative which after its merger with Anglia is proposing to introduce a formal role for employee representatives on its board.

And there’s a good example of the second arrangement in the way that Ethical Consumer magazine has restructured itself, moving from being a traditional workers coop into one which also offers membership to its supporter-investors.

The issues around what are called multi-stakeholder coops are the theme of a piece I have contributed to the Guardian’s social enterprise site, posted at the end of last week. I’m pleased to see it is already attracting some feedback.

Multi-stakeholder coops are not in fact a new idea.  I’ve recently been doing a little amateur research into a nineteenth century producer cooperative in the town where I live where, as well as the workers, local cooperative societies also had ownership rights.  And of course if you look at the present-day governance arrangements for the Co-operative Group you’ll see that it too has representation from the remaining independent cooperative societies on its Board.  In this sense, it isn’t a 100% bona-fide consumer-owned cooperative – it’s a hybrid.

These sorts of arrangements generally seem to work adequately.  There may perhaps be potential conflicts of interest between the different classes of member, but methods seem to be found in practice to ensure that any tensions are creative rather then destructive.

But here’s the really big question:  what if one of the classes of stakeholder is made up of external investors with no particular interest in the cooperative except as a source of profit?  Can coops successfully be structured with investors as members?  Or when it comes to operating genuine cooperative businesses are they heading towards the exit door?

This is a philosophical question with immediate practical relevance, given what is about to happen to the Co-op Bank.  So more soon on this issue.  And please feel free to leave your own thoughts.

Defending cooperative identity

An email arrives from Co-operatives UK: “We have had a major campaigning success for the Co-operative sector – we have found out today that our campaign to lobby government has resulted in continuing protection for the word ‘co-operative’ in business names”.

They’re right to be pleased:  there’s been slow but steady growth in public awareness in recent years that the cooperative business model may just provide some sort of alternative to the short-termism and profit-focus of conventional business and it would have been very damaging if, as the UK government originally suggested, the term cooperative had ceased to be protected.

(It would have been highly ironic, too, if after those low years at the end of the twentieth century when the main consumer coops desperately tried to pretend they were just like any other business the position reversed and conventional businesses started trying to brand themselves as coops.)

There does remain the debate about what exactly constitutes a coop.  The correct answer here, of course, is that coops undertake to abide by the cooperative values and principles devised by the International Co-operative Alliance (ICA) – but in practice the cooperative family is a diverse one, with differing degrees of commitment to those values of “self-help, self-responsibility, democracy, equality, equity and solidarity”.

A new opportunity to strengthen a shared sense of identity between cooperatives will come next month, however.  The ICA will be launching at its Cape Town conference a new cooperative branding, which it hopes will be used internationally as an easy way to identify and promote coop businesses. The brand’s logo, incidentally, has been designed by the long-established workers’ coop Calverts, based in London. (I’ll be commenting here further when the brand is publicly unveiled).

That 10% student discount at the Co-op

The Co-op Group has introduced a 10% discount for students on their food (and, it seems, drink) purchases.  Good idea,  students need all the help they can get these days.  And good idea, too, to introduce a new generation of people to the idea of the consumer cooperative movement. Except…

“Don’t talk to me about the 10% discount”, said the NUS Extra card-carrying student in our household yesterday.  She has been trying to claim her discount four times over the past few days, with a success rate so far of 50%.  It has not been easy.  Each time she’s arrived at the till the authorisation card has had to be found from the office at the far end of the store, the supervisor has had to be summonsed, and the queue of (increasingly impatient) other customers has built up behind.  On Thursday, she took pity on the queue and walked away without the 10%.  And yesterday the supervisor told her that the discount wasn’t available as she had already proffered her Co-op membership card.  (Really? I find this heard to believe. I will see what I can find out).

We ask a lot of our coops.  We expect them to be ethical, we expect them to sell good quality produce at good prices, and we hope that they treat their staff at least as fairly as the competition.  But we also legitimately expect them to run their businesses effectively and efficiently.

Should I mention the Co-op own-brand Red Leicester, complete with a large £2 sticker on the pack, which was in my basket last week.  At the till, it rang through at £2.05.  Oh well, what’s fivepence?