Here’s how member democracy works at the Nationwide

I have just been invited to take my part in the Nationwide Building Society’s democratic process. Or in other words, the voting paper for the 2014 AGM has arrived in the post.

I will vote, of course, but I can’t say I’m very excited by the prospect. The way member control operates in the Nationwide (as in so many other larger building societies) is not an attractive one. We are invited to endorse – or otherwise – the board members already in place. There are no alternative candidates to select.

The board is, in short, a self-perpetuating one. In years where board vacancies occur new directors are co-opted and only subsequently presented to the membership for endorsement. This may well produce a board with some of the right professional competencies, but it doesn’t suggest an organisation where members’ voices can really be listened to.

Actually, Nationwide is interesting because there was a time back in the 1990s when independent candidates regularly stood against board nominees and were actually elected to the board on (from memory) three occasions. I remember covering the news when the first independent, Sheila Heywood, was successful in her election. Some of this interest by activists in the Nationwide was historical, coming from the fact that Nationwide was originally the cooperative movement’s building society.

Recent times have seen attempts at direct member candidacy in building society elections wither away (leaving aside for a moment the Ecology). It’s a pity. It’s also directly relevant to the debate at the Co-operative Group on future governance arrangements since Lord Myners’ recommendations propose a very similar arrangement for board elections as building societies.

In the meantime, back to my voting paper. I see that Nationwide’s chief executive Graham Beale has target remuneration of £2.31m for 2014/15, with a possible maximum of £2.74m. Curiously, these amounts are given by Nationwide in the booklet to members as £2,312K and £2,749K – is this because somehow that way they seem less gigantic?


Good governance in the Group

I’ve mentioned a couple of times the Co-operative Group’s current member survey Have Your Say.  I now want to draw your attention to another – unofficial – online discussion forum and questionnaire which has just been launched to encourage debate on the way forward for the Group.

The Manchester Area Committee of the Group (area committees are the lowest tier in the Group’s current complex structure) deserve congratulations for establishing Co-operative Springboard (  As they say, they’ve done this as their response to the Group’s current corporate governance review being conducted by Lord Myners.  I think they’re right to see the review potentially as an opportunity to strengthen, rather than diminish, good cooperative governance structures within the Group – though this outcome is by no means guaranteed, and there are strong contrary pressures which would move the Group further away from its democratic roots.

The Manchester Area Committee stress that the Group’s membership structure is potentially a real advantage which competitors would be delighted to have: “We are missing an opportunity to show how different we are… We must open up. We need to make membership meaningful for the many who don’t take part in elections and meetings,” they say.

Myners is operating on a very short timeframe, so it is important that as much debate as possible about the future governance of one of the world’s largest cooperative businesses takes place now.