I’ve been reading today a thought-provoking report, still in draft form, which the International Co-operative Alliance (ICA) will be bringing out shortly: The Capital Conundrum for Co-operatives. And it has done its job: it’s provoked me to think.
Curiously, though, it hasn’t just got me thinking about cooperative-friendly capital instruments (always a favourite topic of mine). Instead, it’s made me think more broadly. And it’s made me wonder if the time is right to encourage the ICA to pioneer a ‘Global Cooperative Index’, one which measures just how well (or how badly) an individual cooperative enterprise is doing in meeting agreed international cooperative principles.
What defines a cooperative? Not the legal structure: in Britain (and elsewhere in the world too) coop businesses nestle under all sorts of legislative frameworks. Not the capital structure, either: businesses which most people would accept as being within the cooperative family have developed all sorts of equity and quasi-equity financial instruments to meet their capitalization (or regulatory) requirements.
So it has to come down to something else: what Singapore’s Tan Suee Chieh and his colleague Chuin Ting Weber call in the ICA report ‘the cooperative spirit’. Or in other words how well these businesses really meet the essence of cooperation. How well their business practice tallies with cooperative values and principles.
Recent years have seen businesses signing up for a whole range of Corporate Social Responsibility measures (I thinking of such things as Social Accountability International’s SA8000 standard, as well as the UN’s overarching Global Compact initiative). So what about a Global Cooperative Index, which I feel the urge to name ICA2020?
ICA2020, which would score cooperatives’ practice in a range of areas, would of course be a voluntary undertaking by cooperatives – although it would be good to think that there’d be some peer pressure to participate (and benchmarking is all the rage in business these days). So what would sort of things would ICA2020 monitor? Oh, you know: member engagement, the percentage of members voting in elections and attending meetings, employee satisfaction, employee understanding of cooperative principles, customer satisfaction, internal pay differentials (the lesser the better), the CEO’s ego quotient (the lesser the better, although I accept this is hard to measure), gender and diversity indices, socially responsible investment practice, the percentage of profits used for charitable or community purposes, average time taken in paying suppliers, all kinds of environmental indicators…
I think you get the idea. And, you know what, it might just take off.