OCTOBER 2018
The October 2018 edition of Co-op News is all about politics: Can cop-operatives steer a course through troubled times? Plus... breaking the association with Communism in eastern Europe / co-ops and the civil rights movement in the USA / the UKSCS conference / MEET... Co-op Party stalwart, Lord Graham of Edmonton
The October 2018 edition of Co-op News is all about politics: Can cop-operatives steer a course through troubled times? Plus... breaking the association with Communism in eastern Europe / co-ops and the civil rights movement in the USA / the UKSCS conference / MEET... Co-op Party stalwart, Lord Graham of Edmonton
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<strong>OCTOBER</strong> <strong>2018</strong><br />
POLITICS<br />
Can co-ops steer<br />
a course through<br />
troubled times?<br />
Plus ... Breaking the<br />
association with communism<br />
in eastern Europe ... the<br />
UKSCS annual conference ...<br />
Black Lives Matter ... Brexit<br />
ISSN 0009-9821<br />
9 770009 982010<br />
01<br />
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cooperativenews<br />
With far right parties making electoral gains in Europe, the Trump<br />
administration widening divisions in the USA and the Brexit process<br />
in stalemate (p46-47), there seems no end in sight to the political<br />
fallout from the global financial crisis of 2008.<br />
It’s a worrying and uncertain situation – but arguably, it is one which<br />
opens up space for new, more progressive ideas to flourish and replace<br />
the prevailing neoliberal economics. If so, that makes it the perfect<br />
time to make the case for the democratic ownership models offered<br />
by the co-op movement.<br />
In the UK, these ideas are gaining traction with grassroots movements<br />
and thinktank reports looking at applying co-op and mutual ideas<br />
to energy, housing, transport and employment (p44-45). The<br />
Co-operative Party, formed to represent the movement 100 years ago,<br />
will be presenting its own ideas for the UK economy at its annual<br />
conference in Bristol, from 12-14 October (p42-43).<br />
The co-op movement is being revitalised elsewhere in the world,<br />
too – whether it is being harnessed to the Civil Rights movement in the<br />
USA (p40-41), working with government to improve living standards in<br />
Malawi (p36-37) or shaking off associations with discredited regimes<br />
in eastern Europe to build new enterprises (p34-35).<br />
But does this mean co-op models can build a convincing argument<br />
to counter the reactionary politics offered by right wing populists?<br />
We speak to Ariel Guarco, president of the International Co-operative<br />
Alliance, and US grassroots organiser John Duda – who makes the<br />
case for a more progressive populist tradition which has existed in the<br />
USA, and calls for a pluralist system of ownership models to create a<br />
more inclusive economy (p38-39).<br />
Hopefully these ideas can grow and offer more democratic solutions<br />
to the economic and environmental problems facing the world.<br />
MILES HADFIELD - DIGITAL EDITOR<br />
Co-operative News is printed using vegetable oil-based<br />
inks on 80% recycled paper (with 60% from post-consumer<br />
waste) with the remaining 20% produced from FSC or PEFC<br />
certified sources. It is made in a totally chlorine free process.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 3
association with communism<br />
in eastern Europe ... the<br />
UKSCS annual conference ...<br />
Black Lives Matter ... Brexit<br />
ISSN 0009-9821<br />
01<br />
9 770009 982010<br />
THIS ISSUE<br />
CLOCKWISE FROM FAR LEFT<br />
Claire McCarthy, general secretary of the Co-op<br />
Party, looks ahead to its annual conference<br />
(p42-43); the month’s news includes a strong<br />
half-year for the Co-op Group (p6); we speak<br />
to veteran co-operator Lord Graham (p26-27);<br />
and the late Chokwe Lumumba, a leading light<br />
of African-American co-operation (p40-41)<br />
news Issue #7300 <strong>OCTOBER</strong> <strong>2018</strong><br />
Connecting, championing, challenging<br />
<strong>OCTOBER</strong> <strong>2018</strong><br />
POLITICS<br />
Can co-ops steer<br />
a course through<br />
troubled times?<br />
Plus ... Breaking the<br />
£4.20<br />
www.thenews.coop<br />
COVER: There’s a wave<br />
of reactionary populism<br />
dominating world politics<br />
– but can co-ops work with<br />
people in a more<br />
meaningful way?<br />
Read more: p32-47<br />
25 CO-OPERATIVE HERITAGE TRUST<br />
A final update on the Working Together<br />
project to build an archive of UK worker<br />
co-op history<br />
26-27 MEET ... LORD GRAHAM<br />
OF EDMONTON<br />
The stalwart of the Co-op Party and<br />
movement, now 93, looks back on his<br />
career and the state of co-operation<br />
28-31 THE UK SOCIETY FOR<br />
CO-OPERATIVE STUDIES<br />
Full reports from the UKSCS annual<br />
conference in Sheffield, including the<br />
society’s annual report<br />
32-47 POLITICS SPECIAL<br />
32-33 POPULISM AND THE<br />
NEW ECONOMY<br />
The financial crisis has broken the<br />
neoliberal consensus – but which ideas<br />
will fill the gap it has left?<br />
34-35 EASTERN EUROPE<br />
After the fall of communism, co-ops<br />
suffered from their association with the<br />
old regimes – but now there are signs of a<br />
revival for the movement<br />
36-37 MALAWI<br />
The co-op movement has close ties to<br />
the government as efforts are made to<br />
drive development. And the Co-operative<br />
College is working with co-ops there, too<br />
38-39 Q&A: A CO-OP RESPONSE<br />
Ariel Guarco from the International<br />
Co-operative Alliance and US activist John<br />
Duda discuss the ways co-ops can offer a<br />
way forward through difficult times<br />
40-41 CIVIL RIGHTS<br />
The African American community has a<br />
proud co-operative heritage. It is now<br />
building a path to economic selfdetermination<br />
amid renewed activism<br />
42-43 CO-OP PARTY CONFERENCE<br />
Preview of this year’s event, where the<br />
Party will discuss Brexit and its plans to<br />
reshape the economy and double the size<br />
of the co-op sector. We speak to Party chair<br />
Gareth Thomas MP and general secretary<br />
Claire McCarthy<br />
44-45 THINKTANK REPORT<br />
The Institute for Public Policy Research has<br />
issued a report on the UK economy, which<br />
calls for more worker representation.<br />
46-47 BREXIT<br />
As the UK’s departure from the EU<br />
continues to dominate the landscape, just<br />
how well prepared are co-op businesses?<br />
REGULARS<br />
6-14 UK updates<br />
15-22 Global updates<br />
24 Letters<br />
48-49 Books<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 5
NEWS<br />
CO-OP GROUP<br />
Co-op Group returns to pharmacy sector as half-year profits rise by £12m<br />
The Co-op Group’s has reported pre-tax<br />
profits of £26m (2017: £14m) in its interim<br />
results for the six months to 7 July.<br />
Revenues rose 10% from £4.5bn to<br />
£5bn, underlying profit before tax was up<br />
from £3m to £10m, and net debt fell from<br />
£775m to £707m.<br />
The Group said a strong sales<br />
performance and the purchase of Nisa had<br />
driven the figures. Food like-for-like sales<br />
were up 4.4% and the Group, which noted<br />
positive trading factors such as the World<br />
Cup and the summer heatwave, has now<br />
enjoyed 18 consecutive quarters of likefor-like<br />
sales growth.<br />
CEO Steve Murrells confirmed the<br />
purchase of prescriptions app Dimec,<br />
which allows the management of repeat<br />
NHS prescriptions.<br />
The deal marks a return to the<br />
healthcare sector for the Group, which<br />
sold its pharmacies in 2014 as it recovered<br />
from its financial crisis. Mr Murrells said<br />
it would allow the Group “to accelerate<br />
the development of our healthcare<br />
proposition, and provides the digital<br />
platform to help customers conveniently<br />
access and link their healthcare needs,<br />
including interacting with their NHS GP”.<br />
This emphasis on health and wellness<br />
ties in to the Group’s Food business, with<br />
healthy-eating and free-from ranges.<br />
Mr Murrells told a press conference call<br />
he hoped this would “nudge” people to<br />
healthier lifestyles and reduce future<br />
pressure on the NHS.<br />
The Group said it had delivered £35m<br />
of member value through the “5+1”<br />
membership scheme, alongside price<br />
offers on home insurance and funerals.<br />
It added: “Our Co-op presence is<br />
p The World Cup and summer heatwave helped boost sales<br />
strengthened through the acquisition of<br />
Nisa and the Co-op now supplies food to<br />
over 7,700 stores. By the end of <strong>2018</strong> we<br />
will supply 850 Co-op own-brand product<br />
lines to our Nisa partners.<br />
“Co-op continues to lead the way in the<br />
Funeral sector via numerous measures<br />
to tackle funeral affordability ... Our<br />
Co-op social impact also increases with<br />
over 12,000 local community projects<br />
having now benefited from our member<br />
reward scheme and over a dozen business<br />
partners having joined our Bright Future<br />
programme to tackle modern slavery.”<br />
Asked about the Group’s contingency<br />
plans for a no-deal Brexit, Mr Murrells<br />
said the Group was “in good shape” to<br />
meet the challenges of Brexit but “we<br />
want certainty and no surprises”, adding<br />
that he wanted assurances on migrant<br />
labour to protect colleagues working at<br />
the Group.<br />
Jo Whitfield, chief executive of the Food<br />
business, said the Group’s commitment<br />
to British suppliers offered it some<br />
protection, but called for “certainty” from<br />
the government on its supply chains.<br />
“It’s tough because people are working<br />
in uncertain conditions,” she said, adding<br />
that there was still not enough information<br />
to draw up contingency plans.<br />
Asked if there plans to store food, Mr<br />
Murrells said the Group had the capacity<br />
to stockpile longer shelf-life products but<br />
warned that the real area of need would<br />
be on fresh produce, affecting its imports<br />
of fruit and other short-life products.<br />
“Even if we were to quadruple our<br />
chilled storage at docks for fresh food, it<br />
would not be enough,” he said.<br />
“We are nimble and agile enough to do<br />
the right thing to protect availability, but<br />
we are keen that the government hears<br />
our concerns.”<br />
Beefed up ethical policy sees an end to single-use plastic bags<br />
The Co-op Group has announced an end<br />
to single-use plastic, with the removal of<br />
60 million plastic carrier bags in a phased<br />
rollout of an environmentally friendly<br />
alternative.<br />
The move is part of a radical new ethical<br />
strategy at the Group, which will also<br />
tackle food waste, healthy eating, saving<br />
energy and trading fairly. It sets out how<br />
the retailer will ban single-use own-brand<br />
plastic products and reduce its overall<br />
use of plastic packaging within five years,<br />
and cut out hard to recycle materials, like<br />
black plastic.<br />
Lightweight compostable carrier bags,<br />
which can be used to carry shopping home<br />
and re-used as waste bags, will be rolled<br />
out to almost 1,400 Co-op food stores<br />
across England, Scotland and Wales.<br />
The Group’s pledge on plastic will see<br />
all its own-brand packaging become easy<br />
to recycle by 2023. It has promised to use<br />
a minimum of 50% recycled plastic in<br />
bottles, pots, trays and punnets by 2021.<br />
6 | <strong>OCTOBER</strong> <strong>2018</strong>
Co-op Group staff<br />
protest against<br />
‘dangerous’ one-on-one<br />
food store shifts<br />
A group of Co-op Group workers have<br />
handed a petition to the retailer’s head<br />
office in Manchester to complain about<br />
one-on-one shifts, where just two staff are<br />
on duty in a store.<br />
The petition, addressed to chief<br />
executive Steve Murrells, calls on the<br />
Group to: “Put an end to one-on-one<br />
shifts and have at least three staff for all<br />
shifts. Having just two staff is not enough<br />
to do all the work required whilst keeping<br />
customers happy.”<br />
It adds: “It’s unsafe to have just one<br />
member of staff on the shop floor and one<br />
in the back in case of an accident. Please<br />
put an end to one-on-one shifts and replace<br />
them with something safer, better for the<br />
customer and manageable for your staff.”<br />
The staff members – working with<br />
workplace campaign group Organise –<br />
met the Group’s head of retail PR Craig<br />
Noonan to discuss the issue, and handed<br />
out a booklet to staff in the lobby, which<br />
contained accounts of incidents including<br />
armed robberies at Co-op stores, a lack<br />
of security, and too much work being<br />
expected of staff, the petition says.<br />
The petition, which has attracted<br />
5,904 signatures, adds: “We frequently<br />
have customers complaining about<br />
having to queue, about the lack of stock<br />
on the shelves and the fact that there<br />
are never staff members on the shop<br />
floor to help customers. This not only<br />
puts stress on the manager but also on<br />
the rest of the staff, which leads to low<br />
staff morale and staff members going<br />
off sick. It also means good staff leaving<br />
the company.<br />
p Staff present the petition at the Group’s Manchester head office<br />
“One-on-one shifts also cause problems<br />
for health and safety as often there is<br />
only one member of staff on shop floor,<br />
leaving them vulnerable. The staff<br />
member at the back of the store could also<br />
have an accident; by the time the other<br />
staff member realises, it might be too<br />
late to help.”<br />
A Group colleague at a store in<br />
Maidstone, Kent, wrote: “I have been<br />
held up at gun point before, and also a<br />
machete. I’ve had altercations with plenty<br />
of thieves and drunken people.”<br />
From Wokingham, a colleague wrote:<br />
“We have robbers come in to check out<br />
how many people are on the shop floor<br />
and then we get robbed! We regularly<br />
have shoplifters but we are able to stop<br />
them if we are not one-on-one.”<br />
And in Greater Manchester, a worker<br />
with type-1 diabetes wrote: “I have had<br />
hypos due to not being able to have<br />
a break being one-on-one. The fear<br />
comes into play because of the dangers<br />
if I pass out while in the warehouse and<br />
the other member of staff is unaware.”<br />
Other store colleagues complained of<br />
customers being kept waiting because of<br />
the short staffing, and said tasks had not<br />
been completed efficiently.<br />
A team member from Great Yarmouth<br />
wrote: “If both myself and a team leader<br />
are on the till, the shop floor itself is<br />
not being correctly supervised and<br />
monitored ... Staff are always going home<br />
later than their shift.”<br />
A Co-op Group spokesperson said:<br />
“Safety of colleagues is our number one<br />
priority and our policy is not to have lone<br />
workers in any store.”<br />
They added that the Group works<br />
closely with police and other crime<br />
prevention bodies to implement a range<br />
of measures designed to deter and disrupt<br />
criminal activity, while increasing the<br />
likelihood of convictions.<br />
All own-brand black and dark plastic<br />
packaging, including black ready meal<br />
trays, will be eliminated by 2020.<br />
Jo Whitfield, head of Co-op Food,, said:<br />
“The Co-op was founded on righting<br />
wrongs, and we first campaigned to stop<br />
food fraud. Now we face huge global<br />
challenges and have created a recipe<br />
for sustainability to source responsibly,<br />
treat people with fairness and produce<br />
products which have minimal impact on<br />
the planet.<br />
“We can’t do it alone, which is why<br />
partnerships are key to our plan.”<br />
The Future of Food report will be<br />
unveiled at a supplier conference on 27<br />
September. It has been developed to meet<br />
the UN’s sustainable development goals<br />
to end poverty, protect the planet and<br />
ensure prosperity for all by 2030.<br />
The Group already sources 100%<br />
renewable energy for its stores, but will<br />
go on to tackle greenhouse emissions at<br />
its logistics operation and reduce energy,<br />
water and waste in its supply chain.<br />
It will continue to campaign for the<br />
rights of workers in its supply chain,<br />
having raised the issue of modern slavery,<br />
and will raise funds to bring clean water<br />
to communities in developing countries.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 7
RETAIL<br />
Profits at John Lewis<br />
drop 99% amid tough<br />
times on the high street<br />
Profits at worker-owned retailer John<br />
Lewis Partnership have fallen 99% before<br />
tax and exceptional items in its half-year<br />
results to 27 July, with chair Sir Charlie<br />
Mayfield warning: “These are challenging<br />
times in retail.”<br />
The figure slumped to £1.2m from<br />
£83m a year earlier. Gross sales were up<br />
1.6% to £5,486.6m, revenue rose 1.5% to<br />
£4,856.7m and profit before tax fell 80.5%<br />
to £6m, with the results in line with a<br />
warning made by the company in its<br />
strategy update in June.<br />
Profits for the full-year would be<br />
“substantially lower”, it added, pointing<br />
to uncertainty over Brexit negotiations.<br />
The news comes a week after the<br />
retailer launched a rebrand, accompanied<br />
by a glossy TV ad, to emphasise its<br />
partnership model. This saw the words “&<br />
Partners” added to the Waitrose and John<br />
Lewis brands.<br />
But the Partnership also announced<br />
around 200 job cuts to its back office,<br />
with reports claiming that IT, finance and<br />
store security staff will be affected. It also<br />
revealed that 1,838 people had been made<br />
redundant in the past year, 289% more<br />
than in the previous 12 months.<br />
New jobs have been created – including<br />
600 staff hired when it opened its new<br />
Westfield store in White City, London,<br />
and grew its own-label design and<br />
buying teams. In total, there are 700 fewer<br />
employees across the group than a year<br />
ago, and it has just over 83,000 staff.<br />
The Partnership said: “Profits before<br />
exceptionals are always lower and more<br />
volatile in the first<br />
half than the second<br />
half. It is especially so<br />
this half year, driven<br />
mainly by John Lewis<br />
& Partners where<br />
gross margin has been<br />
squeezed.<br />
“The pressure on<br />
gross margin has<br />
predominantly been<br />
from our commitment<br />
to maintain price<br />
competitiveness.<br />
“We have seen an<br />
unprecedented level<br />
of price matching as<br />
other retailers have<br />
discounted heavily.<br />
“Gross margin was<br />
also affected by a sales<br />
mix shift towards<br />
electronics rather<br />
than big ticket items<br />
in Home. In addition,<br />
John Lewis & Partners<br />
profits were impacted<br />
by the costs of new<br />
shops and higher IT<br />
costs as we continued to invest for future<br />
growth, and from lower property profits<br />
compared to last year.”<br />
At Waitrose & Partners, profits were<br />
down on last year, but the report added:<br />
“From Q1 to Q2 there has been marked<br />
improvement in like-for-like sales as<br />
well as good progress in rebuilding gross<br />
margin, and we are on track for profit<br />
growth for the full year.”<br />
With the “level of uncertainty facing<br />
consumers and the economy, in part<br />
due to ongoing Brexit negotiations”, the<br />
Partnership said it was hard to forecast<br />
the next six months, but that it expected<br />
profits to be down.<br />
Sir Charlie told BBC Radio 4’s Today<br />
programme that the weak pound<br />
following the Brexit vote had increased<br />
costs, and warned that a no-deal Brexit<br />
“would be a very bad outcome for the<br />
UK and the consequences are extremely<br />
unpredictable”.<br />
He added that Waitrose would not<br />
be able to stockpile goods in case food<br />
deliveries from the EU were interrupted,<br />
adding: “It rots, and you waste it.”<br />
The Partnership said there had been<br />
extra costs including investment in cyber<br />
security and data protection, but “total<br />
net debts are £700m less than last year<br />
and we continue to maintain a strong<br />
liquidity position.<br />
“This is all consistent with our plans to<br />
ensure a strong financial position in order<br />
to invest in our strategy of differentiation<br />
at a rate of £400m-£500m per year.”<br />
It added: “Our Partnership structure<br />
and our Partners are key differentiators for<br />
us in a highly competitive and changing<br />
retail market.<br />
“The launch last week of John Lewis &<br />
Partners and Waitrose & Partners reflects<br />
our ambition for the future.”<br />
8 | <strong>OCTOBER</strong> <strong>2018</strong>
COMMUNITY SHARES<br />
Standard bearer for community shares notches up a century<br />
p Eden-Rose Community Ltd, the 100th organisation to win the mark<br />
The Community Shares Standard Mark –<br />
the ‘rubber stamp’ for community shares<br />
– has issued its 100th certificate, to a<br />
charity set up to help people with lifelimiting<br />
conditions.<br />
Launched in 2015, the Standard<br />
Mark was developed by the Community<br />
Shares Unit, run by Co-operatives UK<br />
and Locality, with early support from the<br />
Financial Conduct Authority (FCA).<br />
The scheme assesses and certifies the<br />
quality and viability of share offers and is<br />
presented to community share offers that<br />
meet national standards of good practice.<br />
The 100th certificate was presented<br />
to Eden-Rose Community Ltd, a Suffolkbased<br />
charity, during Communities Week<br />
<strong>2018</strong> (10-17 September).<br />
The organisation aims to raise £80,000<br />
from the local community to support its<br />
mission to use woodlands and the natural<br />
environment as a way to provide support<br />
to children and adults with life-limiting<br />
illnesses such as cancer.<br />
“We’re thrilled to find out that our<br />
forthcoming share offer received the 100th<br />
Standard Mark,” said Jo Brookes from<br />
Eden-Rose.<br />
“Going through the Standard Mark<br />
process was crucial for our organisation<br />
as we develop our community business<br />
offer to actively complement the front-line<br />
work of our charity.”<br />
The charity is also receiving support<br />
from the Booster Programme, another<br />
scheme run by the Community Shares<br />
Unit and backed by Power to Change.<br />
The Booster Programme provides<br />
development grants of up to £10,000<br />
and invests equity of up to £100,000 to<br />
match community shares in societies that<br />
can demonstrate higher than average<br />
levels of community impact, innovation<br />
and engagement.<br />
In September, Co-operatives UK<br />
unveiled research showing that one in<br />
four people would invest money or time<br />
to help save a local community asset; 23%<br />
would be likely to invest to help save their<br />
local pub from closure, and they would<br />
give time and energy to help run other<br />
local assets such as a local park or public<br />
space (25%), historical site or building<br />
(24%) or cinema or theatre (16%).<br />
“It’s so inspiring to see communities<br />
responding in such a proactive way<br />
to the challenges they face, and using<br />
community share offers to achieve their<br />
dreams,” said Ed Mayo, secretary general<br />
of Co-operatives UK.<br />
“As well as helping to save and develop<br />
local assets, community shareholders<br />
become co-owners with an equal say in<br />
how the enterprise is run. We encourage<br />
other communities to be inspired by<br />
the likes of Eden-Community Ltd.<br />
WHAT ARE COMMUNITY SHARES?<br />
Community shares are a way for<br />
communities to crowdfund to save,<br />
launch or develop enterprises,<br />
such as pubs or renewable energy<br />
projects, by investing often small<br />
sums of money and becoming<br />
co-owners in the process.<br />
Community shares are a type<br />
of withdrawable share capital<br />
unique to co-operative and<br />
community benefit societies; this<br />
type of share capital can only be<br />
issued by co-operative societies,<br />
community benefit societies and<br />
charitable community benefit<br />
societies.<br />
Since 2009, almost 120,000<br />
people across the UK have<br />
raised more than £100m through<br />
community shares to save or<br />
create 350 local assets.<br />
The support is out there – what can<br />
your community achieve together?”<br />
Communities wanting to find<br />
out more or who are considering<br />
community share offers should<br />
contact: communityshares@uk.coop<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 9
FINANCE<br />
Two more credit<br />
unions awarded 5-star<br />
Fairbanking Mark<br />
Clockwise Credit Union and Transave<br />
Credit Union have received the 5-star<br />
Fairbanking Mark for their loan products.<br />
This means 17 credit unions across<br />
Britain have received the mark from<br />
the Fairbanking Foundation, which<br />
was established in 2008 to encourage<br />
and assist the development of banking<br />
products that improve the financial<br />
wellbeing of their users by enabling them<br />
to manage their money better.<br />
Clockwise’s general manager, Teresa<br />
Manning, said: “We are absolutely<br />
delighted. We are proud to be part of the<br />
credit union community and fostering<br />
the credit union ethos. We passionately<br />
believe in putting our members’ needs at<br />
the heart of all we do.<br />
“This award reflects our commitment<br />
to leading the way in improving the<br />
financial wellbeing of our community<br />
and its people with a quality loan product<br />
appropriate to their needs, and providing<br />
first class customer service.”<br />
Rachael Hardman-Jones, chief<br />
executive of Transave, said: “Everyone<br />
at Transave Credit Union is overjoyed.<br />
Obviously, this achievement reflects very<br />
well on those connected with the credit<br />
union, their hard work and dedication.<br />
But more importantly, it is recognition that<br />
the financial wellbeing of its members is<br />
hardwired into Transave’s DNA.”<br />
Aidene Walsh, chief executive of the<br />
Fairbanking Foundation, said: “We’re<br />
delighted to recognise the effectiveness<br />
of the personal loans of Clockwise and<br />
Transave Credit Unions.<br />
“We have now assessed the personal<br />
loan products of 17 credit unions and<br />
evidence shows that credit unions are<br />
playing an increasingly important role<br />
in people’s financial lives in the UK.<br />
Fairbanking looks forward to certifying<br />
more credit unions across all products<br />
in <strong>2018</strong>.”<br />
Central England’s new<br />
Food store in Ashby<br />
RETAIL<br />
Strong results<br />
for Central<br />
England<br />
Central England Co-operative<br />
has announced a strong<br />
financial performance for the<br />
first half of <strong>2018</strong>. The society’s<br />
interim results show sales<br />
grew by 3.6% to £476.9m<br />
compared with the same<br />
period last year, with trading<br />
profit rising by £1m (8%) to<br />
£12.9m.<br />
In the first six months, the business invested £12.4m in a<br />
growth strategy which includes the opening of six new Food<br />
Stores, one new Funeral Home and two New Funeral Booking<br />
Offices alongside the renovation of another 32 sites.<br />
Martyn Cheatle, Central England chief executive, said the<br />
results were “encouraging” and reflected the “hard work of our<br />
colleagues” and continued focus across the Society on providing<br />
great service and products to members and customers.<br />
“Our performance so far in <strong>2018</strong> has again demonstrated the<br />
Society’s resilience as a strong and successful independent cooperative<br />
business,” he said.<br />
RETAIL<br />
Co-op Group and Scotmid salute<br />
Scottish food and drink suppliers<br />
Scotland’s farmers, food and drink manufacturers and suppliers<br />
were honoured at the first ever Co-op Scottish Supplier Awards..<br />
The event was jointly organised by the Co-op Group and<br />
Scotmid Co-op as part of Scottish Food and Drink Fortnight<br />
(1-16 September). Between them, the retailers stock more than<br />
1,800 Scottish lines in their stores.<br />
The winners are:<br />
• Bakery of the Year – Stag Bakeries Ltd<br />
• Beers, Wines and Spirit Product of the Year – Rock Rose Gin<br />
by Dunnet Bay Distellers and Innis and Gunn’s Craft Brewed<br />
Lager<br />
• Best Agricultural Initiative – Rattlerow Scotland Ltd<br />
• Fresh Product of the Year – AVA Rosa Strawberries by Angus<br />
Soft Fruits<br />
• Grocery Product of the Year – Equi’s Isle of Skye Sea Salt and<br />
Caramel Ice Cream<br />
• Investor in Scottish Communities – Malcolm Allan Ltd Family<br />
Butcher and Tennent’s Lager<br />
• Local Supplier of the Year – Equi’s Ice Cream<br />
• Most Sustainable Supplier – We Hae Meat Ltd<br />
• New Product of the Year – Protein 22 by Graham’s Family Dairy<br />
• Own-label supplier of the Year – Angus Soft Fruits<br />
• Supplier of the Year (Judges’ Choice) – A. G Barr soft drinks<br />
10 | <strong>OCTOBER</strong> <strong>2018</strong>
East of England scores with anti-social behaviour scheme<br />
MEDIA<br />
New Internationalist<br />
relaunches print mag<br />
The New Internationalist magazine will<br />
come in a new format from September, as<br />
a bimonthly publication of 84 pages.<br />
Based in Oxford, New Internationalist<br />
was set up 44 years ago as a worker co-op.<br />
Last year it changed its legal structure from<br />
a worker co-op registered as a company to a<br />
co-operative society.<br />
During the conversion, the New<br />
Internationalist received financial<br />
support from the Hive and the Community<br />
Shares Company, while around 3,400<br />
readers bought £700,000 worth<br />
of shares, becoming co-owners in the New<br />
Internationalist Co-operative. It is now the<br />
UK’s largest media co-op.<br />
The new-look New Internationalist<br />
includes more in-depth features and<br />
investigative articles as well as underreported<br />
stories from the Global South.<br />
The September edition is themed around<br />
peace and looks at the struggle against<br />
Boko Haram in Nigeria, Colombia’s<br />
fragile transition from conflict, the role<br />
of traditional diplomacy in the age of<br />
Twitter, and potential routes to peace.<br />
“This is a great time to relaunch,” said<br />
co-editor Hazel Healy. “People want a<br />
progressive, trusted publication to help<br />
make sense of the world. With more space<br />
and a sharper design, we can go further<br />
in-depth and appeal to new audiences<br />
who might not have heard of us.”<br />
Co-editor Dinyar Godrej added: “In the<br />
last few years, we have been focusing<br />
more than ever on the kind of coverage<br />
that our readers hold dear – out-of-thebox<br />
thinking, providing a platform for<br />
vital but often marginalised voices and<br />
grappling with the issues that matter<br />
rather than what’s currently trending.<br />
“Now, we feel, we have a form that fits.”<br />
Co-op Secure Response – part of the East<br />
of England Co-op – has run a programme<br />
of football games to help young people<br />
engage with local authorities. The<br />
project was the joint initiative of Co-op<br />
Secure Response, Suffolk Police, Chantry<br />
Academy and Suffolk County Council. It<br />
was designed to discourage anti-social<br />
behaviour by providing a positive activity<br />
for young people to take part in.<br />
Scotmid to mark 160th anniversary with new store<br />
Scotmid Co-op is building a state-of-theart<br />
convenience store in Drumnadrochit<br />
to celebrate its 160th anniversary. The<br />
4,500 sq ft store will open in the new year.<br />
The society wants to enhance customers’<br />
shopping experience at the store with<br />
a tailored architectural structure and<br />
spacious layout. It is also continuing the<br />
rollout of its remodelled stores.<br />
Midcounties Co-op Fun Day raises £20,000 for charity<br />
A fun day organised by Midcounties<br />
Co-op on 19 August raised £20,000 for<br />
local charities and community groups.<br />
The event featured a cast of popular<br />
characters – including Chewbacca<br />
and stormtroopers from Star Wars and<br />
children’s cartoon favourites Peppa Pig<br />
and Cat Boy from PJ Mask. Attractions<br />
included a fun fair, and BMX stunts.<br />
Anthony Collins Solicitors to give legal support to co-ops<br />
Anthony Collins Solicitors has won a threeyear<br />
contract to provide legal support<br />
to eligible members of Co-operatives<br />
UK. Their role will include advising<br />
co-ops from different sectors on a range<br />
of matters under a legal surgery service,<br />
including commercial advice, contract<br />
matters, property and co-op law.<br />
Central England Co-op acquires six travel shops<br />
Central England Co-op has agreed to take<br />
on six travel branches from Thomas Cook,<br />
bringing the number of travel branches<br />
operated by the society to 26. The six<br />
sites, which are already based in the<br />
society’s food stores in Atherstone,<br />
Oakham, Stirchley, Castle Donington,<br />
Glenfield and Ibstock.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 11
COMMUNITY PUBS<br />
Ambitious plan will see burnt-out pub rise from the ashes<br />
The people of a picturesque but deprived<br />
village in Cornwall are preparing to<br />
rebuild and reopen a derelict pub that<br />
burnt down five years ago.<br />
The Old Ship in Cawsand has been<br />
bought by a community benefit society<br />
with support from Co-operative &<br />
Community Finance, Plunkett Foundation,<br />
and the More Than a Pub programme. The<br />
society wants to rebuild the pub, create<br />
new community facilities and provide<br />
affordable rented accommodation.<br />
Cawsand is on the Rame Peninsula<br />
in the south-eastern corner of Cornwall<br />
near the Devon border; the rural area<br />
comprises seven village, and has suffered<br />
from the decline in dockyard employment<br />
in nearby Plymouth alongside a lack of<br />
affordable housing.<br />
In response, community organisation<br />
the Peninsula Trust has undertaken a<br />
number of initiatives to improve local<br />
prospects, and has become involved in the<br />
restoration of the Old Ship. Co-operative<br />
& Community Finance has helped fund<br />
three of the trust’s previous projects,<br />
including the buying and conversion of a<br />
disused bank building.<br />
p The society wants to restore the historic site as a community hub<br />
Simon Ryan, one of the founders of the<br />
community benefit society, said: “We will<br />
work closely with heritage specialists to<br />
retain and show as much of the original<br />
fabric as we can. There is a smuggler’s<br />
tunnel in there somewhere. The Old<br />
Ship was one of Cawsand’s oldest pubs.<br />
We want to bring it back to life under<br />
community ownership.<br />
“Housing is the biggest problem<br />
affecting our community. Unless<br />
something changes, the heart of the<br />
village will disappear because people,<br />
especially the young, can’t find anywhere<br />
to live at a price they can afford – so they<br />
leave and the village loses out. We want to<br />
build five flats on the upper floors, to be let<br />
at reasonable rents on secure tenancies.<br />
“On the ground floor, we want to<br />
recreate the bar area, using the memories<br />
and photos of the older local people. We<br />
will add a café with a large children’s area<br />
and also include a village information<br />
section for locals and visitors. At the rear,<br />
we’re hoping to build a small Heritage<br />
Centre, supported by local experts.”<br />
Over 300 people have bought shares<br />
in The Old Ship Inn Cawsand Ltd, raising<br />
over £137,500. The target date for<br />
reopening the pub is June 2019.<br />
MUSIC<br />
Community shares bid<br />
to keep a threatened<br />
gig venue rocking<br />
A Bristol music venue is selling shares to<br />
the public in a bid to secure its future as a<br />
community-owned co-operative.<br />
The Exchange, in the city’s Old Market,<br />
announced last month that it was facing<br />
financial difficulties and in response has<br />
put forward the community shares offer to<br />
protect its future.<br />
The 250-capacity venue hopes to raise<br />
£250,000 after putting shares on sale to<br />
the public 4 September – marked by a<br />
publicity event at the Exchange.<br />
Matt Otridge, one of the Exchange’s<br />
three directors, said: “We are in this<br />
industry because we are music fans. At the<br />
moment, we tick along and make a little<br />
bit of money but every year people like<br />
myself are required to give up our time for<br />
free and we just can’t carry on like that.<br />
“A venue is bigger than its directors<br />
and its future shouldn’t be tied to them.<br />
By doing this we can ensure that the<br />
Exchange continues to exist as a music<br />
venue and also bring new blood and ideas<br />
into the decision-making process.”<br />
If successful, the campaign will see<br />
the Exchange become the country’s first<br />
community-owned music-only venue. The<br />
project has already gained considerable<br />
backing, with messages of support<br />
and pledges coming in from singersongwriter<br />
Frank Turner and Geoff Barrow<br />
of Portishead.<br />
The minimum share price of £250<br />
entitles the shareholder to a vote at the<br />
AGM where they can influence how all<br />
aspects of the business are run, including<br />
the programme and scheduling. Shares<br />
are limited to one per investor, regardless<br />
of the amount invested, and investors will<br />
see an annual return of 3% cash or 6%<br />
in-store credit.<br />
Since opening in 2012, the Exchange<br />
has become Bristol’s go-to venue for punk<br />
and hardcore acts. Anyone wishing to<br />
participate in its new business model can<br />
enquire about shares online.<br />
12 | <strong>OCTOBER</strong> <strong>2018</strong>
CREDIT UNIONS<br />
As Wonga goes to the wall, can credit unions seize the moment?<br />
With payday lender Wonga entering<br />
administration, the Association of British<br />
Credit Unions (Abcul) has highlighted<br />
credit unions’ role in providing an<br />
alternative to high-cost creditors.<br />
In spite of the payday lender’s collapse,<br />
customers will still make any outstanding<br />
payments in the normal way. Around<br />
200,000 Wonga customers owe more than<br />
£400m in short-term loans.<br />
In a statement published on 30 August,<br />
the FCA confirmed that all existing<br />
agreements remained in place and would<br />
not be affected by the administration.<br />
However, the firm is no longer able<br />
to issue new loans. The repayments<br />
will be overseen by administrators<br />
Grant Thornton.<br />
Wonga was the UK’s biggest payday<br />
lender. In 2014 the FCA ordered the<br />
business to pay £2.6m to 45,000 customers<br />
for “unfair practices”. New payday loan<br />
regulations introduced in 2015 required<br />
all online lenders to advertise on at least<br />
one price comparison website. The FCA<br />
also imposed a cap on fees and charges<br />
on payday loans at double what was<br />
borrowed, which affected Wonga’s profits.<br />
In 2016, the payday lender reported pretax<br />
losses of nearly £65m.<br />
Abcul’s head of policy and<br />
communication, Matt Bland, warned<br />
that the closure of Wonga should not<br />
be confused with the end of high-cost<br />
lending or payday lending.<br />
He said: “The interest rate cap regime<br />
has caused most short-term lenders<br />
to adapt their lending practices and<br />
many now offer loans on instalment<br />
repayment plans which, while still very<br />
expensive, are much better for consumers.<br />
And while the FCA’s consumer credit<br />
regime had produced improvements<br />
in practices in many respects, lenders<br />
continue to grow and lend to people<br />
who find difficulty accessing credit from<br />
the mainstream.<br />
“Credit unions offer an alternative<br />
to these high-cost creditors which puts<br />
people’s long-term financial resilience at<br />
its heart. They will lend people the smaller<br />
sums that banks won’t consider but at<br />
reasonable rates of interest. At the same<br />
time they encourage people to save, which<br />
is the only long-term route out of a cycle of<br />
p Stella Creasy has been campaigning against payday lenders (Photo: Andrew Wiard/Co-op Party)<br />
debt. The Fairbanking Foundation’s Save<br />
As You Borrow report demonstrates the<br />
power of this method.<br />
Stats published by the Bank of England<br />
in September show that credit unions<br />
have two million members across the UK.<br />
Total assets reported also reached £3.2bn,<br />
2% higher for the first quarter of <strong>2018</strong>,<br />
compared to the same period last year.<br />
Mr Bland says Abcul is working closely<br />
with the government, regulators, banks<br />
and others to support the sector.<br />
“With changes to legislation and<br />
regulation, and some targeted investment<br />
and partnerships with employers to<br />
deliver services in the workplace, credit<br />
unions could become an even more<br />
significant force in providing an ethical<br />
source of credit,” he added.<br />
Writing for the Guardian, Labour/Co-op<br />
MP Stella Creasy, who has been leading a<br />
campaign against payday lenders, warned<br />
that Wonga’s demise would not lead to<br />
an end of “legal loan sharking”. She<br />
pointed out that the number of payday<br />
lenders had fallen but 150 such lenders<br />
continued to operate in the UK. She added<br />
that some lenders offer high cost credit<br />
cards while others ask for guarantors to<br />
chase more people for the same debt.<br />
Actor and activist Michael Sheen also<br />
called on the government to ensure that<br />
Wonga would be sold to an ethical lender.<br />
In March <strong>2018</strong> Mr Sheen launched the<br />
End of High Cost Credit Alliance, which<br />
promotes affordable alternatives, such as<br />
credit unions. Speaking to the Observer,<br />
he added that the collapse of Wonga<br />
was an opportunity for the government<br />
to support “fair and responsible”<br />
credit providers.<br />
Meanwhile, the Scottish government<br />
has pledged to continue its efforts to grow<br />
the credit union sector in its programme<br />
for <strong>2018</strong>/2019.<br />
“We know that accessing affordable<br />
credit is a concern generally across<br />
Scotland,” it says. “That is why we are<br />
investing £1m in the Affordable Credit<br />
Fund, working with the Carnegie UK Trust<br />
to reduce the ‘poverty premium’ lowincome<br />
households often have to pay.<br />
“Care-experienced young people,<br />
in particular, can face considerable<br />
challenges to borrow money. We want to<br />
help. Over the next year, we will work with<br />
the Care Review to develop options which<br />
will help these young people increase<br />
access to financial services.”<br />
Karen Hurst, Scottish policy officer<br />
for Abcul, said: “We’ve been working<br />
closely with the Scottish government on<br />
developing the campaign, and are really<br />
excited to see it launch in November.”<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 13
CO-OP LAW<br />
Building a co-op<br />
commonwealth: UK<br />
movement calls for<br />
a supportive legal<br />
environment<br />
UK co-ops operate in one of the least<br />
supportive legal systems in the EU,<br />
co-op law specialist Cliff Mills told the UK<br />
Society for Co-operative Studies annual<br />
conference in Sheffield last month.<br />
Mr Mills, a consultant with Anthony<br />
Collins Solicitors and principal associate<br />
at sector advocate Mutuo, presented a<br />
study of the laws of Norway and all EU<br />
member states apart from Luxembourg<br />
and Slovenia.<br />
One issue he highlighted was indivisible<br />
reserves – funds set aside from the<br />
surplus, not available for distribution to<br />
members, but owned collectively by them.<br />
These reserves can absorb trading losses<br />
and fund training and development.<br />
This type of ownership is not very<br />
familiar to the UK, where there is a<br />
more individualistic understanding of<br />
ownership, he added. “We see it as a<br />
restriction on an individual’s rights if<br />
something is indivisible,” he said.<br />
But some EU states make it compulsory<br />
for co-ops to set funds aside, and the third<br />
co-op principle says members should<br />
allocate surpluses, “possibly by setting up<br />
reserves, part of which at least would be<br />
indivisible”.<br />
Six states refer to co-ops in their<br />
national constitutions: Bulgaria, Greece,<br />
Italy, Malta, Portugal and Spain.<br />
But the UK is one of five EU states –<br />
alongside Denmark, Estonia, Ireland and<br />
the Netherlands – with no separate law<br />
for co-ops. It has the Co-operative and<br />
Community Benefit Societies Act of 2014,<br />
but this is not a co-op law in the sense that<br />
some EU states have one. And the lack of a<br />
co-op status in UK law hinders legal<br />
practitioners from exploring the model.<br />
Most EU states define co-ops – but again,<br />
the UK is one of four that do not, alongside<br />
Estonia, Ireland and the Netherlands. And<br />
it is one of six states which do not require<br />
a proportion of surplus to be set aside<br />
for reserves – alongside Austria, Czech<br />
Republic, Denmark, Ireland and Norway.<br />
p Cliff Mills, a specialist in co-op law<br />
Mr Mills said the most supportive states<br />
in terms of co-op legislation were Greece,<br />
Italy, Malta, Portugal, Spain, Croatia,<br />
Cyprus, France, Hungary and Romania.<br />
The least supportive were in Austria,<br />
the Czech Republic, Denmark, Estonia,<br />
Ireland, the Netherlands and the UK.<br />
He said the UK sector needs a<br />
conversation about indivisible reserves<br />
and making a common cause with other<br />
states that do not have co-operative law to<br />
get recognition at higher level.<br />
Mr Mills’ remarks echo other calls from<br />
the movement for a more conducive legal<br />
environment. Co-operatives UK is asking<br />
Companies House to change its co-op<br />
definition to draw more directly on the<br />
International Co-operative Alliance’s<br />
Statement on the Co-operative Identity.<br />
By law companies can only use the word<br />
“co-operative” in their name if they satisfy<br />
Companies House that they meet certain<br />
criteria. These include being owned and<br />
controlled by members who participate<br />
in the economic activity of the business,<br />
having voluntary and open membership,<br />
and distributing profits equally among the<br />
members, or at least in proportion to the<br />
extent each member has participated.<br />
Co-ops can also register as societies with<br />
the Financial Conduct Authority. In this<br />
case, the main criterion is being a bona<br />
fide co-op – “an autonomous association<br />
of persons united voluntarily to meet their<br />
common economic, social and cultural<br />
needs and aspirations through a jointly<br />
owned and democratically controlled<br />
enterprise”. Notable exceptions include<br />
the Co-op Bank.<br />
James Wright, policy officer at<br />
Co-operatives UK, said: “For a couple<br />
of years we’ve been working with our<br />
members to establish the case for statutory,<br />
but optional, ‘asset lock’ mechanisms for<br />
co-ops, including indivisible reserves and<br />
disinterested distribution at windup. These<br />
tools could help create a ‘commonwealth’<br />
model for UK co-ops: providing a<br />
better basis for capital to be pooled in<br />
co-ops, built up over time, invested in<br />
other co-ops, and, if a co-op comes to an<br />
end, recycled in the co-op economy.<br />
“A consultation we ran with members<br />
in 2016 suggested we should anticipate<br />
broad and strong demand for optional<br />
statutory ‘asset lock’ tools. But we should<br />
anticipate some strong opposition too –<br />
on the grounds that these measures would<br />
be undemocratic and/or unnecessary.”<br />
But Mr Wright warned against “rushing<br />
ahead with legislative projects that end<br />
up suffering from too little consultation or<br />
scrutiny” and instead look at what works<br />
– and what doesn’t work – abroad.<br />
“We can also learn from our experiences<br />
in the UK,” he said. “For example, while<br />
it has proven extremely useful, the asset<br />
lock for community benefit societies is<br />
increasingly understood to contain some<br />
difficult dysfunctions. We can’t afford<br />
more sub-optimal legislation.”<br />
He added: “Our advocacy has recently<br />
led the New Economics Foundation to<br />
make commonwealth reforms a priority<br />
in co-op policy. And there may soon be<br />
opportunities to progress to legislative<br />
design with government support, but coproduction<br />
with the sector must be central<br />
to this, not an adjunct.”<br />
u More reports from the UKSCS annual<br />
conference, pages 28-31<br />
14 | <strong>OCTOBER</strong> <strong>2018</strong>
GLOBAL UPDATES<br />
USA<br />
Electric co-ops feel the force of Hurricane Florence<br />
With Hurricane Florence set to make<br />
landfall on the Carolina coastline, electric<br />
co-ops in the US have made preparations<br />
to deal with the emergency.<br />
The storm is expected to make landfall<br />
at noon local time on Friday and is moving<br />
at wind speeds of 90mph, threatening<br />
power outages which could last<br />
for weeks.<br />
The National Hurricane Center says<br />
the storm is an extremely dangerous one,<br />
bringing a high volume of rainfall and<br />
storm surges, with the threat of a serious<br />
death toll from inland flooding.<br />
Georgia, North and South Carolina,<br />
Virginia and Maryland have declared<br />
a state of emergency and sea water is<br />
washing through coastal streets.<br />
NRECA, the national body for the<br />
USA’s electric co-ops, said the storm has<br />
already caused power outages for co-op<br />
members, with crews standing down until<br />
conditions are safe to carry out repairs.<br />
The organisation says it is closely<br />
monitoring the situation and supporting<br />
co-ops in North Carolina, South Carolina,<br />
Georgia and Virginia.<br />
NRECA’s communications and<br />
government relations departments are<br />
leading the effort, which is designed to<br />
provide resources to electric co-ops as<br />
they respond to the storm.<br />
During Hurricanes Harvey, Irma and<br />
Maria, NRECA says supported affected<br />
p A team from Tennessee’s Sequachee Valley Electric Cooperative takes men and equipment to<br />
assist co-op recovery efforts in North Caroline (Photo: Sequachee Valley Electric Cooperative)<br />
co-ops by providing talking points, social<br />
media guidance, and media outreach.<br />
NRECA also coordinates with the<br />
Federal Emergency Management Agency,<br />
the Department of Energy and other<br />
federal agencies during extreme weather<br />
events, keeping them updated on its<br />
members’ response to the storm.<br />
Power outages are expected to be<br />
widespread, with hurricane and tropicalstorm-force<br />
winds hitting some areas for<br />
36 to 48 hours or longer.<br />
Lisa Galizia, communications director<br />
of Carteret-Craven Electric Cooperative,<br />
based in Newport, NC, told NRECA’s<br />
website: “We will not put our crews<br />
in harm’s way, and we will not send<br />
anyone out to assess damages and begin<br />
repairs until it is safe to do so.<br />
“People need to remember, too, that<br />
damage may cause outages to systems<br />
up the line from us, such as transmission<br />
lines, which we cannot control.”<br />
The co-operative said that power was<br />
out to thousands of its meters as the storm<br />
set in.<br />
Crews could be forced to sit the storm<br />
out until winds subside to under 35<br />
sustained mph, due to safety concern.<br />
They will not be able to deploy bucket<br />
trucks and are also at risk from falling<br />
trees and windblown debris.<br />
PUERTO RICO<br />
New legal framework eases the way for energy co-ops<br />
Puerto Rico’s state senate has taken steps<br />
to diversify its energy industry by passing<br />
a law on 27 August to provide a framework<br />
for co-ops in the sector.<br />
The legislation aims to transform<br />
the territory’s energy sector and help<br />
communities become more resilient by<br />
forming co-operatives.<br />
Under the rules, an energy co-op will<br />
require a minimum of five members before<br />
setting up. People will be able to develop<br />
co-ops to generate energy for themselves,<br />
as well as distribute it or sell it to the grid.<br />
The law mentions that electric co-ops will<br />
also need to ensure they charge fair tariffs.<br />
The general law of co-operative<br />
societies has also been amended to<br />
include renewable energy co-ops.<br />
In a report to the senate, the<br />
government’s energy department said the<br />
changes are a response to Puerto Rico’s<br />
financial crisis and the need to rebuild<br />
after Hurricane María, which devastated<br />
the island last September.<br />
The territory’s renewable energy<br />
association says the law should be used to<br />
develop renewable energy co-operatives<br />
rather than fossil fuel co-ops.<br />
The Coalition for Economic<br />
Co-operation of Puerto Rico welcomed<br />
the law, which it sees as an opportunity<br />
to develop a decentralised energy system.<br />
Larry Seilhamer, president of the<br />
special energy commission, said: “In<br />
the current environment faced by Puerto<br />
Rico, it is necessary and worthy to enable<br />
communities to explore alternatives to<br />
generate, transmit and distribute their<br />
energy. In this sense, energy public policy<br />
needs to grant communities more access<br />
to this essential type of service. The<br />
co-operative model is ideal.”<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 15
DENMARK<br />
Dairy co-op Arla will give entire <strong>2018</strong> profit to farmers hit by drought<br />
p Dead cornfields in the Netherlands – a typical sight in Europe during the drought<br />
Arla Foods, one of the world’s biggest<br />
dairy firms, is to pay out its entire <strong>2018</strong><br />
net profit of up to €310m (£278.48m) to<br />
its members after one of the hottest and<br />
driest summers on record.<br />
The proposal from the agri co-op’s<br />
board follows significant improvement in<br />
Arla’s finances over recent years.<br />
The firm, owned by 11,200 farmers in<br />
Denmark, Sweden, Germany, Britain,<br />
Luxembourg, the Netherlands and<br />
Belgium, traditionally pays only a part of<br />
its profit to owners, but said it would make<br />
an exception this year.<br />
Company chair Jan Toft Nørgaard<br />
said: “The board recognises that many<br />
Arla farmers are facing a tough financial<br />
situation due to this summer’s drought in<br />
Europe, and that it is in Arla’s best interest<br />
for this year’s net profit to be paid out to<br />
the farmers.<br />
“Arla’s board of directors has discussed<br />
and agreed on a proposal for the<br />
company’s supreme governing body,<br />
the board of representatives, to pay out<br />
the entire net profit from <strong>2018</strong> when<br />
the annual results are approved early<br />
next year, thus making a one-year only<br />
deviation from the company’s usual profit<br />
appropriation policy.”<br />
He added: “As a farmer-owned dairy<br />
company, we care deeply about the<br />
livelihood of our farmers and we recognise<br />
that this summer’s drought in Europe has<br />
been extraordinary.<br />
“We are proposing that extraordinary<br />
measures be taken in this situation,<br />
and the board is satisfied with the<br />
improvement in the company’s finances,<br />
which makes this proposal possible.”<br />
The move comes as farmers across<br />
Europe try to recoup losses after the<br />
heatwave hit cereal harvests and dried<br />
out pastures, leaving some on the edge<br />
of bankruptcy and shutting the EU out of<br />
lucrative export markets.<br />
“It is obvious farmers have had a tough<br />
time acquiring fodder, and it’s been more<br />
expensive. This puts the farmers’ economy<br />
under pressure,” Arla chief executive<br />
Peder Tuborgh told Reuters press agency.<br />
The proposal will be discussed at the<br />
next board of representatives meeting in<br />
October, and brought forward for a final<br />
decision at the meeting in February 2019<br />
when the annual results are approved.<br />
A statement from Arla added that the<br />
amount of this payout remains subject to<br />
there being no material changes to the<br />
profit level or financial outlook at the end<br />
of the year.<br />
If approved, the extraordinary payment<br />
will follow Arla’s regular supplementary<br />
payment timetable with money being paid<br />
out in March 2019.<br />
The company says it will return to<br />
its existing retainment policy for the<br />
remainder of the current strategic period,<br />
affecting the financial years of 2019<br />
and 2020.<br />
“Our balance sheet has improved<br />
significantly over the last few years,”<br />
said Mr Tuborgh, “and the strength<br />
of our balance sheet makes room for<br />
this extraordinary initiative while still<br />
maintaining our investment plans<br />
for the continued future growth of<br />
the company.”<br />
16 | <strong>OCTOBER</strong> <strong>2018</strong>
SPAIN<br />
DCOOP Group<br />
acquires<br />
20% stake in US olive<br />
producer Bell-Carter<br />
Agri-food business DCOOP has acquired a<br />
20% stake in Bell-Carter, the largest table<br />
olive producer in the US and the second<br />
largest in the world.<br />
As part of the deal, DCOOP’s USA<br />
branch, Acorsa USA, will be integrated<br />
into the Bell-Carter structure, with the<br />
aim of strengthening its position in the<br />
USA market.<br />
Bell-Carter produces and sells over<br />
half of all California olives, processing<br />
between 40,000 and 60,000 tons of olives<br />
each year.<br />
The DCOOP Group includes 180 co-ops<br />
with 75,000 families and two production<br />
plants, which process a total of 100,000<br />
tons a year.<br />
In 2017, the value of the co-op’s total<br />
exports amounted to €541m, a 10.5%<br />
increase from 2016. The co-op exports<br />
to 72 countries, the USA being its third<br />
biggest olive oil market after Europe<br />
and Japan.<br />
Last year, DCOOP, which is the largest<br />
olive oil co-operative in the world,<br />
signed an agreement with Pompeian<br />
Group, a Baltimore-based importer<br />
and manufacturer of olive oil. The deal<br />
increased the companies’ stakes in one<br />
another from 20% to 50%.<br />
A spokesperson for the co-op said: “We<br />
are farmers and we want our products to<br />
be marketed all over the world. The US<br />
is an important market where we have<br />
already been selling olives and oil, as part<br />
of the Pompeian project.<br />
“With this agreement, we intend to<br />
encourage the consumption of more olives<br />
in the US and we believe the alliance with<br />
leading company Bell-Carter will help in<br />
that respect. We are very excited about<br />
the partnership and we now have to work<br />
together to drive olive consumption in the<br />
USA and around the world.”<br />
The collaboration with Bell-Carter<br />
comes at a time when Spanish olives<br />
are facing total taxes of 34.75% to enter<br />
the USA’s market. By buying a share in<br />
the business, DCOOP has ensured it will<br />
continue to grow in the USA.<br />
According to Copa Cogeca, the<br />
organisations representing European<br />
farmers and agri co-operatives, Spanish<br />
imports have already faced additional<br />
duties totalling 21.6% since January this<br />
year, causing Spanish exports to the USA<br />
to drop by as much as 42.4% in the first<br />
quarter of <strong>2018</strong>.<br />
Agrosevilla, a Spanish group of 12<br />
co-operatives and 4,000 producers,<br />
announced restructuring plans to cope<br />
with the USA’s tariffs. The group is Spain’s<br />
largest olive oil co-operative exporter.<br />
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<strong>OCTOBER</strong> <strong>2018</strong> | 17
EUROPE<br />
Cooperatives Europe wants young co-op<br />
entrepreneurs to share their stories<br />
Cooperatives Europe is calling on young<br />
co-operative entrepreneurs to share their<br />
stories in short videos.<br />
It hopes to collect 10-20 short videos to<br />
share on social media under the hashtag<br />
#ImACoopStarter. Young co-operators<br />
wishing to take part have to introduce<br />
themselves and their business, say why<br />
they chose the co-op model, and what<br />
advice they would give other young<br />
people thinking of starting a co-op.<br />
Each answer must be maximum of 20<br />
seconds long.<br />
The films are part of the Coop Starter 2.0.<br />
project, a European initiative launched<br />
last year to mobilise youth around<br />
co-operative entrepreneurship.<br />
The programme is funded by the<br />
European Commission and builds on the<br />
previous CoopStarter project, created<br />
by eight partner organisations across<br />
Europe to teach younger people about the<br />
co-operative business model.<br />
Cooperatives Europe is the regional<br />
office of the International Co-operative<br />
Alliance and one of the partner<br />
organisations. The others are Legacoop<br />
Liguria (Italy), Kooperationen (Denmark),<br />
K.A.P.A Network (Greece), Promo<br />
Jeunes ASBL (Belgium), CJDES (France),<br />
AEGEE (Belgium) and the Co-operative<br />
College (UK).<br />
Video submissions can be<br />
sent to: e.rosenberg@coopseurope.coop<br />
Participants also need to post on social<br />
media using the hashtag #CoopStarter<br />
and mentioning @coopseurope. More<br />
details on Cooperatives Europe’s website.<br />
USA<br />
Going global: Skincare co-op<br />
takes its healthy message to the States<br />
Skin health co-op JooMo presented its<br />
research on microbiomes in San Francisco<br />
last month.<br />
Working with the Medical University of<br />
Graz, in Austria, JooMo is looking at the<br />
possible link between cosmetics and the<br />
enormous rise in skin allergy problems in<br />
the western world. It focuses on the effect<br />
of cosmetics on human skin microbiomes<br />
– communities of micro-organisms.<br />
JooMo, which unveiled the findings at<br />
the Global Skin Microbiome Congress,<br />
says the trials show how high street<br />
cosmetics appear to maintain the depleted<br />
western microbiome, while third-wave<br />
microbiome-friendly products like JooMo<br />
increase skin microbiome biodiversity,<br />
which improves skin health.<br />
Everyday cosmetics were also shown<br />
to greatly de-moisturise the skin, a key<br />
reason why skin becomes damaged, the<br />
co-op says – while its own third-wave<br />
technology makes it “the only product to<br />
maintain skin moisture”.<br />
Kit Wallen Russell – research coordinator<br />
and lead author of the peer-reviewed<br />
2017 paper Meta Analysis of the Skin<br />
Microbiome – said: “The terrifying rise in<br />
skin allergies has led many to speculate<br />
whether regular contact with everyday<br />
cosmetics are a major contributor to this<br />
problem.”<br />
“These results, coupled with other<br />
complementary research, are now<br />
suggesting a definitive link.”<br />
This should not really come as any great<br />
surprise, he adds, pointing out that the<br />
food industry has been restricting the use<br />
of additives for many decades.<br />
“Cosmetics consumers are finally<br />
cottoning on to the fact that covering their<br />
bodies with harsh unfamiliar chemicals<br />
every day probably isn’t a good idea,”<br />
he said.<br />
“These results show how the cosmetics<br />
industry must urgently introduce the same<br />
safety standards as the food industry,<br />
including the ending of misleading<br />
labelling and the severe restriction in the<br />
use of chemical additives.”<br />
JooMo, which is based in Reading, UK,<br />
was formed in response to an increase in<br />
childhood skin problems and developed a<br />
100% natural preservative-free face wash.<br />
p JooMo offers all-natural products<br />
18 | <strong>OCTOBER</strong> <strong>2018</strong>
CHILE<br />
Laying the<br />
groundwork for an<br />
agri co-op revival<br />
Chile’s agriculture minister Antonio<br />
Walker has announced a meeting of<br />
Congress in October to explore “the<br />
best legislation to reinvigorate modern<br />
co-operativism in Chile”.<br />
Speaking at a special session on<br />
co-operatives, organised by the senator<br />
of the Los Ríos region, Alfonso de<br />
Urresti, the minister said: “Co-operatives<br />
represent the most important opportunity<br />
for the development of the economy and<br />
our agriculture.”<br />
Of Chile’s 300,000 farmers in Chile,<br />
285,000 work at small scale, and Mr<br />
Walker is calling for greater co-operation<br />
and collaboration within the sector.<br />
“The ministry of agriculture strongly<br />
advocates modern co-operativism,<br />
productive alliances, forming teams and<br />
breaking individualism, because this<br />
game is won as a team – and the way to<br />
do that is by promoting co-operation,”<br />
he said. “We have a very demanding<br />
international market in terms of volume<br />
and quality, and for that we have to<br />
unite, we have to come together – and<br />
co-operativism is a central issue.”<br />
The session, held at Chile’s national<br />
Congress, was also attended by the<br />
president of the Senate, Carlos Montes,<br />
and the president of the agriculture<br />
committee, Carmen Gloria Aravena.<br />
Mr Walker said initiatives to unite<br />
farmers and encourage co-operation<br />
“are in line with what we want to<br />
p A vineyard in the Coquimbo region<br />
develop ... We have to form a team to<br />
adapt Chilean agriculture to the modern<br />
co-operativism that’s working in other<br />
parts of the world.<br />
“We’re working on this – it’s a very<br />
important focus for our ministry and we<br />
are going to hold an international congress<br />
on October 3 and 4, where we are inviting<br />
senators to participate and support us<br />
to explore what is the best legislation to<br />
reinvigorate modern co-operativism<br />
in Chile.”<br />
FRANCE<br />
Co-op champers beats the big-name bubblies in taste test<br />
A blind tasting of Champagnes, held by<br />
industry magazine The Drinks Business<br />
last month, saw lesser-known labels from<br />
the region’s co-ops outdo famous rivals.<br />
Among the seven Champagnes that<br />
gained a Gold medal or higher in the Brut<br />
Non-Vintage category were Champagnes<br />
Palmer and Pannier, two brands owned<br />
and run by co-ops. They were placed<br />
above celebrated – and more expensive<br />
– labels, such as Champagnes Pommery<br />
and Laurent-Perrier.<br />
Co-op label Champagne Castelnau<br />
achieved a near-perfect score in the<br />
vintage Champagne category, for its<br />
release from the 2006 harvest. The same<br />
category saw the 2008 vintage from<br />
Champagne Chassenay d’Arce – a growers’<br />
co-op in the Aube – pick up a Gold.<br />
Finally, one of the highest-scoring<br />
Champagnes of the day’s tasting – which<br />
saw almost 200 bottles sampled blind<br />
by experienced judges – was Egérie<br />
p Egérie de Pannier 2006<br />
de Pannier 2006, the top cuvée from<br />
Pannier co-op. Gaining 97 points out of<br />
100, it was praised for its combination of<br />
complementary flavours, from lemon and<br />
honey, to toast and grilled nuts, along with<br />
an uplifting, lasting and very fresh, dry<br />
finish. It costs £75, but the Drinks Business<br />
says this is “amazing value relative to<br />
other special blends in this top-end<br />
Champagne category, from Dom Pérignon<br />
to Cristal, which can retail for almost<br />
double the price”.<br />
Among other co-op Champagnes that<br />
performed well were labels from Nicolas<br />
Feuillatte, Montandon and Jacquart, each<br />
picking up Silver medals for a range of<br />
cuvées.<br />
The Drinks Business added: “Although<br />
Champagnes sourced from growers’<br />
co-operatives are often believed to be<br />
of lesser quality, the tasting in August<br />
proved that such producers can achieve<br />
outstanding results, and even make<br />
superior cuvées than the famous Grandes<br />
Marques, despite the lower prices.<br />
“For those who know the Champagne<br />
region well, however, such an outcome<br />
may not surprise, with co-operatives<br />
being major suppliers of grapes and wine<br />
to many well-known names in the region,<br />
who own few vineyards themselves.”<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 19
EUROPE<br />
Mixed co-op reaction to Juncker’s State of the Union speech<br />
The co-operative sector has responded<br />
to the State of the Union speech delivered<br />
on 12 September by president of the<br />
European Commission, Jean-Claude<br />
Juncker.<br />
Addressing the European Parliament,<br />
Mr Juncker announced a series of policy<br />
proposals around immigration, Brexit,<br />
the economy, the 2019 elections and<br />
strengthening the union’s partnership<br />
with Africa.<br />
Responding to the speech, Cooperatives<br />
Europe, the regional organisation of the<br />
International Co-operative Alliance, said<br />
it agrees with president Juncker on the<br />
need for “a strong and united Europe”<br />
but argued this would only be achieved by<br />
ensuring strong links with citizens.<br />
And it regrets the omission of the<br />
White Paper on the Future of Europe, an<br />
initiative that puts citizens at the heart of<br />
building and determining the future path<br />
for Europe.<br />
In February, Cooperatives Europe<br />
stressed the importance of co-ops<br />
in achieving a “more inclusive and<br />
sustainable Europe”, as set out in<br />
the Future of Europe white paper.<br />
The organisation also argued that the<br />
speech had not adequately addressed<br />
the Sustainable Development<br />
Goals theme.<br />
Jean-Louis Bancel, president<br />
of Cooperatives Europe, said: “As<br />
Europe faces numerous challenges,<br />
co-operative, as well as social economy<br />
enterprises, must be seen as key partners<br />
for the EU in offering solutions that put<br />
the focus back on the people and back<br />
on our values. To move forward, we now<br />
need a stronger commitment from the<br />
European institutions to our movement,<br />
p Mr Juncker delivers his speech<br />
as together we preserve the diversity<br />
and richness of Europe.”<br />
Mr Juncker also proposed a new Alliance<br />
for Sustainable Investment and Jobs<br />
between Europe and Africa. Cooperatives<br />
Europe is currently engaged in discussions<br />
on the EU External Investment Plan.<br />
The Commission president also called<br />
for stronger anti-money laundering<br />
supervision and enhancing the role of the<br />
European Banking Authority.<br />
GLOBAL<br />
Co-operation can get the world’s small<br />
farmers a better deal, says Oxfam report<br />
Farmers around the world can earn a<br />
higher share of consumer price if they<br />
collaborate, says Oxfam.<br />
The charity’s new report, Ripe for<br />
Change, undertaken by the Bureau<br />
for the Appraisal of Social Impacts for<br />
Citizen Information, found small-scale<br />
farmers benefit from much higher shares<br />
of the end consumer price − around 26%<br />
− where they are organised in co-ops.<br />
Farmers who are not organised in<br />
co-ops retain only around 4% of the end<br />
consumer price, it adds.<br />
The study analysed the value chains<br />
of 12 common products sourced by<br />
supermarkets around the world, from<br />
producing countries in Asia, Africa and<br />
Latin America.<br />
It found producer co-ops add value by<br />
aggregating their produce, supporting<br />
marketing, sharing risks, and amassing<br />
stronger bargaining powers.<br />
One example is the Alaznistavi<br />
Cheese Cooperative in Georgia,<br />
which has allowed members to gain<br />
a higher share of the end consumer<br />
price through niche production of<br />
high quality handmade cheese for<br />
distribution through supermarkets in the<br />
capital, Tbilisi.<br />
Another case study in the report is<br />
Divine Chocolate in the UK, which is 44%<br />
owned by a cocoa co-op in Ghana.<br />
“Consumer-facing companies such as<br />
Divine Chocolate and Cafédirect – which<br />
are both jointly owned by producers<br />
in developing countries – each have<br />
a turnover of $15m per annum,” the<br />
report says.<br />
But the study found that women in<br />
some co-ops do not feel on an equal level<br />
with men. While women in large and<br />
often mixed-gender co-operatives often<br />
gain access to agricultural inputs and<br />
services, they enjoy only a limited role in<br />
decision-making, it said.<br />
“By contrast, small, more informal<br />
women-only groups typically allow<br />
women to build confidence, leadership,<br />
skills and savings,” the report added.<br />
Ripe for Change argues that these<br />
business models do not have to be niche<br />
– and could be taken to scale. Producerled<br />
Kaira District Cooperative Milk<br />
Producers Chain in India, also known<br />
as Amul, is jointly owned by 3.6 million<br />
SUMMARY ................................<br />
RIPE<br />
FOR<br />
CHANGE<br />
ENDING HUMAN SUFFERING IN<br />
SUPERMARKET SUPPLY CHAINS<br />
p Oxfam’s latest report<br />
milk producers in Gujurat, with a sales<br />
turnover of $736m in 2016.<br />
The report urged supermarkets to<br />
place a focus on sourcing from business<br />
structures that aim to share value<br />
with farmers and workers, such as cooperative<br />
groups or women’s collective<br />
enterprise, and use prominent shelf<br />
positioning to promote these products.<br />
20 | <strong>OCTOBER</strong> <strong>2018</strong>
SAO TOME AND PRINCIPE<br />
Rebirth of cocoa<br />
industry based on co-op<br />
values and high quality<br />
p Producers from CECAQ-11<br />
A farmers’ co-op in São Tomé and Príncipe<br />
is producing a superior crop of beans to<br />
gain an advantage in the world market.<br />
The country – a set of islands in Africa’s<br />
Gulf of Guinea – was once one of the<br />
world’s biggest cocoa producers but its<br />
industry has collapsed in recent decades.<br />
Today, farmers on the island of São Tomé<br />
are working to revive the crop’s reputation,<br />
and have organised themselves into<br />
co-operatives with a shared pride in the<br />
excellence of their crop.<br />
Charlotte Borger, of farmer-owned<br />
Divine Chocolate, wrote on the its blog:<br />
“Spending time with the members of the<br />
CECAQ-11 co-operative, we saw and heard<br />
evidence of this pride every day.<br />
“Cocoa growing, especially on the<br />
steep slopes of the island, is a labour<br />
-intensive affair, but these farmers can see<br />
the benefit of being more meticulous and<br />
skilled in how they manage their farms.<br />
“They have been trained in better<br />
pruning methods, in shade management<br />
(cocoa grows best in the humid shade of<br />
the rainforest canopy), and in grafting<br />
seedlings to combine quality with<br />
higher productivity.”<br />
She added: “The farmers are developing<br />
their own improved version of amelonado,<br />
a sub-species of forastero, that delivers a<br />
distinctive depth of flavour with woody,<br />
spicy notes. Their care with harvesting,<br />
natural fermenting and drying ensure<br />
they are extracting the best from their<br />
beans, while the new techniques they<br />
are learning will help with the increased<br />
productivity they urgently need to meet<br />
demand, and grow their income.”<br />
Sad end to Galicia’s clothing co-op movement<br />
Co-op forest plan to tackle climate change<br />
Confecciones Corcubión, the last<br />
remaining clothing manufacturing co-op<br />
on the Costa da Morte in Galicia, north<br />
west Spain has ceased operation after more<br />
than 30 years. The closure came about<br />
after a change in management at Inditex<br />
which saw Confecciones Corcubión receive<br />
orders for women’s clothing – which the<br />
worker members didn’t have the skills or<br />
machinery to produce. The co-op will be<br />
dissolved at the end of the month.<br />
A Canadian co-operative is pioneering<br />
a new approach to carbon offsetting,<br />
with a focus on the social aspect<br />
of planting trees. Set up as a co-operative<br />
in 2016, Arbre-Évolution has recently<br />
become a certified partner of Coop<br />
Carbone, which works with enterprises<br />
to identify, develop and fund carbonoffsetting<br />
projects.<br />
42 member-owned companies on Australia’s top 500 list<br />
Australia’s co-op and mutuals sector has<br />
a strong showing in the <strong>2018</strong> IbisWorld<br />
Index, with 42 businesses from the<br />
sector making the top 500. The results<br />
show the resilience of the model, says<br />
Melina Morrison, chief executive of<br />
national sector body the Business Council<br />
of Co-operatives and Mutuals<br />
Dominican Republic backs sector with co-op fair<br />
The Dominican Republic’s National<br />
Council of Co-operatives is hosting<br />
the country’s first co-op fair from 15-<br />
18 November. The event – Expo Coop<br />
<strong>2018</strong> – will bring more than 100 of the<br />
country’s leading co-ops together for<br />
a programme of workshops, talks,<br />
presentations and networking.<br />
WOCCU calls to reduce CU capital requirements<br />
The World Council of Credit Unions is<br />
asking international standard setting<br />
agencies for regulatory changes to provide<br />
a level playing field for credit unions and<br />
community based financial institutions.<br />
The consultation on its report ‘Incentives<br />
to centrally clear over-the-counter<br />
derivatives’ can be read at: s.coop/2aocz<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 21
NEW ZEALAND<br />
Fonterra dairy<br />
falls into the red and<br />
re-asseses investments<br />
Dairy giant Fonterra has reported a yearly<br />
loss of NZ $196m (£98m) – compared to<br />
last year’s profit of $745m (£373m).<br />
The co-op, New Zealand’s largest<br />
company, blamed the results on high<br />
butter prices, which impacted volumes<br />
and margins; the increase in the forecast<br />
farmgate milk price late in the season; and<br />
higher costs in its ingredients business.<br />
Other factors were higher costs as<br />
Fonterra expanded in Australia, and<br />
increased IT and R&D expenditure to<br />
support development.<br />
Its performance was also affected<br />
by a write-down of $405m (£203m) in<br />
Fonterra’s Beingmate investment in China<br />
and the pay out of $183m (£91m) to global<br />
infant formula maker Danone for the 2012<br />
botulism scare.<br />
In August, Fonterra reduced last<br />
season’s farmgate milk price to $6.70<br />
(£3.36) per kg of milk solids from $6.75<br />
(£3.39). “Our farmers rely on accurate<br />
forecasting when planning. Our decision<br />
to update our earnings guidance and<br />
reduce our 2017/18 forecast Farmgate Milk<br />
Price late in the year was frustrating but<br />
necessary to protect the balance sheet,”<br />
wrote chair John Monaghan in the report.<br />
More accurate earnings forecasts was<br />
an “obvious priority” for 2019, he added.<br />
Interim chief executive Miles Hurrell,<br />
who took over the business after former<br />
boss Theo Spierings resigned in March,<br />
said: “We entered the second half of this<br />
year expecting our performance to be<br />
weighted to the second half.<br />
“The reality is, for this to have happened<br />
we needed an outstanding third and<br />
fourth quarter after an extremely strong<br />
second quarter for sales and earnings.<br />
Unfortunately, this didn’t eventuate.<br />
Forecasting is never easy, but ours wasn’t<br />
on the mark and proved to be optimistic.”<br />
The Kiwi co-op plans to re-evaluate<br />
investments, major assets and<br />
partnerships, including its Beingmate<br />
investment in China, to ensure they still<br />
meet the co-operative’s needs.<br />
“This will involve a thorough analysis<br />
of whether they directly support the<br />
strategy, are hitting their target return on<br />
capital and whether we can scale them up<br />
and grow more value over the next two to<br />
three years,” said Mr Hurrell.<br />
Craig Presland, chief excutive of<br />
Cooperative Business New Zealand, which<br />
represents the national co-op sector, said<br />
the performance had not been impacted<br />
by its co-operative status.<br />
He added that the co-op model remains<br />
“a key strength and founding pillar of the<br />
organisation – with financial benefits for<br />
milk supplied provided to its shareholders<br />
(members) only, profits retained locally<br />
and, most importantly, 100% local<br />
shareholder ownership and control of<br />
the organisation.<br />
“Fonterra remains solely within the<br />
control and hands of its dairy farmers and<br />
long may that continue.”<br />
AUSTRALIA<br />
Digital innovation drives growth at Credit Union Australia<br />
Australia’s largest credit union witnessed<br />
a small drop in profit for the year ended 30<br />
June <strong>2018</strong> following investment in digital<br />
technologies.<br />
Credit Union Australia, which provides<br />
financial, health and insurance services<br />
to around 470,000 Australians, reported a<br />
net profit of AU$54.79m (£30.14m), down<br />
1.9% from the previous year.<br />
Retail deposits grew 5.3% for the year<br />
to a record $9.22bn (£5.07bn) while loans<br />
under management were up 6.7% to<br />
$12.30bn (£6.7bn).<br />
Banking membership grew by a net<br />
20,008, which CEO Rob Goudswaard said<br />
was driven by the digital changes and<br />
brand awareness campaigns.<br />
“We now offer a full suite of digital<br />
wallets,” he added. “We’ve delivered an<br />
updated mobile banking app provided by<br />
Kony ... Members are benefiting from faster<br />
payments through CUA being an early<br />
adopter of the New Payments Platform<br />
(NPP), with 16,500 PayIDs registered by<br />
our members in the first four months. And<br />
we’ve had outstanding feedback from the<br />
2,000 members piloting our messaging<br />
app from Pivotus Inc, the international<br />
banking collaboration we joined this<br />
year.”<br />
Meanwhile its insurance arm CUA<br />
Health saw an increase of $1.49m (£8.2m)<br />
on its previous full-year result, to a $8.99m<br />
(£494m) net profit after tax. The company<br />
also passed on its lowest average premium<br />
increase in almost two decades.<br />
Digital innovation saw the roll-out of a<br />
refreshed health mobile app, and the pilot<br />
of a chatbot to supplement its human<br />
service team.<br />
CUA Health also launched three new<br />
lower cost hospital cover products this<br />
year, including a new hospital and extras<br />
package, aimed at first time buyers and<br />
young people.<br />
22 | <strong>OCTOBER</strong> <strong>2018</strong>
New book chronicles the crisis<br />
at the Co-op Bank<br />
To purchase: thenews.coop/fall
YOUR VIEWS<br />
WAKE UP, GOVERNMENT!<br />
Game changing is the challenge, so<br />
why the John Lewis Partnership name<br />
change? Part of Co-operatives UK – with<br />
Waitrose – it has a larger turnover than the<br />
Co-operative Group.<br />
Bonuses for never knowingly undersold<br />
partners have gone down these past five<br />
years with growing online competition<br />
from the likes of Amazon. Spending<br />
millions on changing the organisation’s<br />
name to John Lewis and Partners hardly<br />
seems the priority (although consultants<br />
may benefit).<br />
The priority is surely for the government<br />
to get its act together on retail taxation.<br />
Amazon, with revenues in billions, pays but<br />
millions in tax. Delivering to the customer<br />
increases road traffic and maintenance,<br />
not to mention the disposal of cardboard<br />
waste at public expense.<br />
As more high street retailers vanish,<br />
less money will come in from business<br />
rates and local taxation – and the onliners<br />
replacing them do not contribute much.<br />
Jim Craigen<br />
Edinburgh<br />
RE: WORKER OWNERSHIP ON THE<br />
AGENDA AS MCDONNELL WELCOMES<br />
THINKTANK REPORT (P42-43)<br />
Sorry John McD, instead of putting<br />
a sticking plaster on the failing and<br />
discredited capitalist system, why not get<br />
behind an all-out drive to promote the<br />
co-operative model?<br />
The people want democratically owned<br />
ethical organisations. While at school,<br />
college or university, students learn<br />
nothing about the alternative to the corrupt<br />
capitalist model which offers wealth for<br />
the few. It’s time not just for a level<br />
playing field, but for a system that<br />
redresses the balance.<br />
No one should leave public or private<br />
education without a full understanding of<br />
the different models – with every hour of<br />
brainwashing on capitalism to be matched<br />
by three on co-operation.<br />
All public employees – both existing<br />
and new recruits – should have at least a<br />
week’s training on the co-operative model<br />
and its benefits. The ease with which<br />
co-operatives can be established should<br />
be made to match that of setting up a as<br />
a self-employed person / partnership / or<br />
private company. The first two can be set<br />
up almost instantly, with no paperwork;<br />
the second takes about half an hour online<br />
and costs nothing.<br />
But to establish a co-operative takes<br />
weeks and costs hundreds of pounds –<br />
and people will try to persuade you not<br />
to do it.<br />
Professional bodies such as lawyers and<br />
accountants should be required to include<br />
the co-operative model in their syllabuses;<br />
at the moment I am told there is nothing.<br />
The UK has a small co-op sector because it<br />
is 100 years behind other countries.<br />
John Harrington<br />
via Facebook<br />
CO-OP GROUP STAFF PROTEST<br />
AGAINST ‘DANGEROUS’ ONE-ON-ONE<br />
SHIFTS (P7)<br />
All comments via Facebook<br />
After being in store during an armed<br />
robbery I know how important staff safety<br />
is. I wish head office would rethink the<br />
one-on-one system.<br />
Gordon Lindsay<br />
I fully support the staff in their quest to<br />
ensure minimum staffing levels in stores.<br />
Risk assessments should be conducted<br />
regularly and ALL incidents should be<br />
recorded for future reference. Staff safety<br />
cannot be compromised in order to<br />
increase profitability.<br />
Christopher Rawlinson<br />
In some cases I agree that workload<br />
and colleagues can be rescheduled to<br />
ensure more even cover, but in certain<br />
cases this extra cost could make some<br />
stores unprofitable and therefore at<br />
risk of closure or disposal. Some of our<br />
competitors operate with only one person<br />
on site during certain hours.<br />
Mark Sanderson<br />
Have your say<br />
Add your comments to our stories<br />
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in touch via social media, or send<br />
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include your address and contact<br />
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letters@thenews.coop<br />
@coopnews<br />
Co-operative News<br />
My daughter used to have to do this<br />
regularly for another chain, including<br />
shifts that finished at 11pm. She was<br />
generally OK about the workload but was<br />
concerned about safety on the nights<br />
the security guard wasn’t on (very rough<br />
area with lots of bars and takeaways).<br />
I also have a friend in a newsagents chain<br />
who is often completely alone, never<br />
more than two, working 11 hour shifts. It<br />
appears to be an industry thing for the<br />
small stores. On the one hand, it would<br />
be good for the Co-op to take the lead<br />
in ending the bad practice – but on the<br />
other, how do you stay competitive in a<br />
crowded market if the wage bill for each<br />
store is increased?<br />
Linda Smith<br />
p Craig Noonan (right), the Group’s head of<br />
retail PR, discusses the issue with staff<br />
24 | <strong>OCTOBER</strong> <strong>2018</strong>
WORKING TOGETHER:<br />
A final update from the Co-operative Heritage Trust<br />
In 2017 the Co-operative Heritage Trust launched<br />
Working Together, a project to find record and<br />
preserve the heritage of the worker co-op movement<br />
of the 1970s-1990s. As the project draws to a close,<br />
archivist Philippa Lewis gives a final update...<br />
SCOPING AND COLLATING MATERIAL<br />
The first stage of the project involved finding out<br />
what material existed – and where it was. Many<br />
items were still held by individuals, often packed<br />
away and forgotten in cupboards or attics.<br />
Working with members of the project steering<br />
committee (who have all been active participants in<br />
the workers’ co-operative movement), we were able<br />
to draw up a list of individuals and co-operatives to<br />
contact. The scoping exercise escalated from this<br />
original list of contacts, with people passing details<br />
of the project to others involved in the worker<br />
co-operative movement.<br />
In total, we contacted over 300 co-operatives or<br />
individuals, many of whom held material relating to<br />
workers’ co-ops that they were keen to deposit with<br />
us at the National Co-operative Archive.<br />
ORAL HISTORIES<br />
Alongside physical items – like banners, bags,<br />
minutes and leaflets – we also spoke with some<br />
of the people involved in worker co-ops during the<br />
1970s, 80s and 90s, which allowed more personal<br />
recollections to be recorded.<br />
In total, staff and volunteers undertook 26<br />
interviews across the UK, with people associated<br />
with, for example, Unicorn, the 8th Day and<br />
Delta-T Devices.<br />
MAKING OUR FINDINGS ACCESSIBLE<br />
From the outset, the aim of the project was not just<br />
to collect material, but to make it accessible to as<br />
large an audience as possible.<br />
Material deposited at the National Co-operative<br />
Archive has now been catalogued, with descriptions<br />
available on the archive catalogue online. This<br />
catalogue will allow researchers to search for<br />
workers’ co-operative collections and choose<br />
material to access in the National Co-operative<br />
Archive reading room in Manchester.<br />
However, it was also recognised that, as a<br />
national project, it was important that material<br />
was also made accessible online, for people who<br />
cannot visit. One way we have done this is to display<br />
workers’ co-operative images on a dedicated Flickr<br />
account, which allows images to be uploaded and<br />
shared, with others able to tag and engage with the<br />
images.<br />
To make the oral histories more accessible, full<br />
transcripts and summaries of the interviews have<br />
been created (many of which were completed by<br />
project volunteers). These have been uploaded<br />
with the recordings to the National Co-operative<br />
Archive website.<br />
A travelling exhibition has also been developed<br />
to showcase some of the findings of the project.<br />
This has been displayed at various venues including<br />
Manchester Central Library and Warwick Modern<br />
Records Centre, and is now at the Rochdale<br />
Pioneers Museum.<br />
INTO THE FUTURE<br />
Although the project itself is coming to an end, the<br />
material and lessons learned from it will live on in<br />
the wider collections of the National Co-operative<br />
Archive. Another long-term aim of the project<br />
is to ensure that workers’ co-operative material<br />
continues to be deposited at the archive.<br />
This will ensure that the heritage of this key part<br />
of the co-operative movement will be preserved<br />
and made accessible to current and future<br />
researchers alike.<br />
The Working Together<br />
exhibition is available for<br />
display at co-operative<br />
events and venues in<br />
the future. If you would<br />
like to know more about<br />
the project, hosting the<br />
exhibition or have some<br />
material you would like<br />
to donate please visit<br />
the National Co-operative<br />
Archive website, contact<br />
us or tweet us.<br />
archive@co-op.ac.uk<br />
@cooparchive<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 25
MEET...<br />
The Right Honourable The<br />
Lord Graham of Edmonton PC<br />
Thomas Edward ‘Ted’ Graham was born in Newcastle in 1925 and started<br />
working at the Newcastle-upon-Tyne Co-operative at the age of 13. He served<br />
in the Royal Marines from 1943, but was severely wounded when taking part<br />
in an exercise in 1944 and returned to the co-operative movement in 1946. He<br />
studied by correspondence courses and at night school and earned certificates<br />
from the Co-operative College. Ted became prime minister of the Tyneside<br />
Youth Parliament and held several positions in the co-operative movement,<br />
being appointed southern section officer of the Co-operative Union and<br />
national secretary for the Co-operative Party. He was the Labour and Cooperative<br />
MP for Edmonton from February 1974; he lost his seat in 1983 but was<br />
created a life peer as Baron Graham of Edmonton. He was Labour chief whip<br />
from 1990-97 and chair of the Co-operative Council, and served as president of<br />
the 1987 Co-operative Congress.<br />
I FIRST GOT INVOLVED IN CO-OPS in the 1940s. As I<br />
am now 93 years of age and joined the Co-operative<br />
Party and the Newcastle Co-operative Society<br />
when I was 17, I can modestly claim to have been<br />
around the course! I first became an addict of the<br />
Co-operative News in the years when it was a vastly<br />
different ‘News’. The year was 1942 and the first<br />
editors that I can recall were Billy Richardson and<br />
Frank Buckshaw, who brought reading pleasure to<br />
thousands of co-operative enthusiasts. But just as<br />
the clientele has changed, so has the congregation<br />
it seeks to serve. The movement as I remember it<br />
has changed out of all shape and size!<br />
I SENSE A FEELING that the future of co-operatives<br />
is full of danger – much of it of our own making.<br />
Let me begin by remembering that the Co-op was<br />
the first retailer to produce what turned out to be<br />
self-service stores. The London Co-op Society (LCS)<br />
led the way. This was one of the biggest of changes<br />
as it engaged the shopper within the democratic<br />
framework of managing the business.<br />
The democracy extended to member meetings. In<br />
the 1940s, gatherings for the Newcastle Society<br />
in the City Hall, which held over 1,000, was often<br />
overflowing. A dividend announcement or a fiercely<br />
fought local issue could draw vast attendance.<br />
There was an air of excitement – the reduction in<br />
the dividend declared could create a riot! Where<br />
are these members now?<br />
THE BEDROCK OF CO-OPERATIVE DEMOCRACY was<br />
epitomised by the strength of the auxiliary bodies<br />
– the Women’s Guild, the Men’s Guilds, the Mixed<br />
Guilds, the BFYC (Young Co-operators). We boasted<br />
what were called ‘activists’, who were active in the<br />
... THE MOVEMENT AS I REMEMBER IT HAS<br />
CHANGED OUT OF ALL SHAPE AND SIZE<br />
... I SENSE A FEELING THAT THE FUTURE<br />
OF CO-OPERATIVES IS FULL OF DANGER –<br />
MUCH OF IT OF OUR OWN MAKING<br />
26 | <strong>OCTOBER</strong> <strong>2018</strong>
ISSN 0009-9821<br />
9 770009 982010<br />
01<br />
years following the Rochdale Pioneers. At one time<br />
in the past 100 years we could rely on the guilds to<br />
democratically keep the board on their toes. But all<br />
of these are gone now too, save spasmodic efforts<br />
to stay alive.<br />
Your co-operatives.<br />
Your Co-op news.<br />
ANOTHER DANGER I SEE is the result of decades of<br />
co-operative mergers.<br />
In Newcastle, for example, I witnessed co-operative<br />
societies clustered around the city merging into a<br />
regional society; thus a modest congregation in a<br />
district was submerged. Over 30 separate societies<br />
merged into one, 30 groups that were whittled<br />
away as their fates were thrown in with other<br />
nearby societies. This meant fewer co-ops. But is<br />
this a good thing?<br />
Whatever happened to the hundreds of oncethriving<br />
societies we were once proud of, their<br />
purpose lost in a morass of fighting for their lives?<br />
Playing the game of expansion does not signal<br />
success but instead we find the very foundations<br />
on which a co-op is built, being eroded away.<br />
news Issue #7294 APRIL <strong>2018</strong><br />
Connecting, championing, challenging<br />
APRIL <strong>2018</strong><br />
EDUCATION<br />
Co-op learning:<br />
principle five<br />
in action<br />
Plus ... 150 years<br />
of East of England ...<br />
and updates from the<br />
Co-op Retail and Abcul<br />
conferences<br />
£4.20<br />
www.thenews.coop<br />
THE WINNING INGREDIENT isn’t necessarily scale<br />
(look at our large competitors who are fighting<br />
to survive) – it rests substantially more on the<br />
quality of management.<br />
Size and business strength does not bring the<br />
success we could once achieve. And although we<br />
cannot match the access to hard capital of our<br />
main competitors, all is not lost. The success of<br />
co-operatives over the last century tells us that the<br />
co-operative principles can be at least one secret to<br />
winning.<br />
THE CO-OPERATIVE NEWS is a great canvas to<br />
reflect on how the new co-operative movement is<br />
emerging, based on men and women with the right<br />
principles at heart. It is full of splendid history<br />
and stories of progress. Modestly, I am likely to<br />
be among the elite who have read the News for a<br />
very long time. I very much welcome the coverage<br />
of world events and recent issues have opened<br />
my eyes to new forms of co-operative, mainly and<br />
strongly worker co-operatives.<br />
Anthony Murray (the previous editor) sailed the<br />
ship in the right direction. Sincere congratulations<br />
to Rebecca Harvey, new editor of the News. I will<br />
read every page of future editions, and anticipate<br />
that it will stimulate more readers, more cooperators<br />
and more appreciation for the vital part<br />
the Co-op News has played for many years. Long<br />
may it do so!<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 27
UKSCS annual conference<br />
The UK Society for Co-operative Studies (UKSCS) held its annual conference<br />
in Sheffield from 31 August – 2 September, bringing together a range of<br />
expert research. Anca Voinea reports on discussions including worker co-op<br />
funds, FairShares and modern slavery ...<br />
Annual report<br />
The UKSCS reported positive financial results<br />
for the year ending 10 April <strong>2018</strong>, with increased<br />
income from events and the sale of its Journal of<br />
Co-operative Studies.<br />
Over the past 12 months, UKSCS has changed<br />
its legal structure from an unincorporated charity<br />
to a charitable incorporated organisation.<br />
Chair Ian Adderley told the AGM the organisation<br />
was in a much healthier position, and had been<br />
financially restored by a successful 2017 annual<br />
conference. The organisation also hosted an<br />
annual lecture, which was livestreamed, and two<br />
law seminars in collaboration with Anthony Collins<br />
Solicitors. “Cash in” increased from £17,097 in<br />
2017 to £19,007 in <strong>2018</strong> while “cash out” rose from<br />
£4,383 to £7,141.<br />
Crowdsourcing meets<br />
co-op development<br />
“The events helped to<br />
educate people about<br />
co-operative forms and<br />
structures and brought in revenue for the society,”<br />
said Mr Adderley.<br />
The UKSCS now has 81 members, and the<br />
journal is bought by around 110 universities, with<br />
subscribers around the world, including in Europe,<br />
Japan, Indonesia, the USA, Canada and Thailand.<br />
The increased income have allowed the<br />
organisation to set up designated funds and<br />
general reserves, and allocate bursaries for those<br />
wishing to attend its annual conference.<br />
Looking ahead, the UKSCS aims to work on<br />
communication and its website.<br />
The AGM also awarded Richard Bickle, who<br />
retired from the board of trustees, an honorary life<br />
membership of the organisation.<br />
p Richard Bickle receives<br />
his honorary membership<br />
of the UKSCS<br />
A fund created four years ago to support the UK<br />
worker co-op sector has reached £76,203, a<br />
session at the conference was told.<br />
The Worker Co-op Solidarity Fund – run by<br />
Solid Fund, an unincorporated collective with 581<br />
contributing members – emerged from a discussion<br />
about a possible development fund at the Worker<br />
Co-op Weekend in 2014.<br />
“Anybody who pays into the fund is a member,”<br />
said Siôn Whellens, a member of design and<br />
print enterprise Calverts, one of the contributing<br />
worker co-ops.<br />
Mr Whellens said there is growing appetite for<br />
industrial democracy within the tech sector, and<br />
most new members are not employees of worker<br />
co-ops but supporters of industrial democracy.<br />
Each member of the fund, whether individual or<br />
corporate, has one vote. It is run on a voluntary<br />
basis, with individual members contributing £1<br />
a week, while worker co-ops pay on behalf of<br />
their members – in some cases through payroll<br />
deduction.<br />
The decisions regarding the allocation of<br />
funding are made collectively through Loomio, an<br />
online collective decision-making tool developed<br />
by a worker co-op in New Zealand.<br />
Around 150 people are active in the Loomio<br />
group, through which Solid Fund makes all<br />
decisions, with 60 members exercising their<br />
voting rights.<br />
Members propose projects for support, which<br />
are discussed and voted on. A number of projects<br />
have already won support, with £3,750 going to<br />
the Creative Workers Co-operative (CWC) for the<br />
purchase of video production equipment.<br />
Last year, a grant went to the successful CoTech<br />
retreat and £6,600 was allocated to find the next<br />
generation of worker co-op development advisers.<br />
“We are now trying to reflect on why this<br />
has this worked and how to make it better,” said<br />
Mr Whellens.<br />
p Siôn Whellens<br />
discusses efforts to fund a<br />
new wave of co-operation<br />
28 | <strong>OCTOBER</strong> <strong>2018</strong>
Where do co-ops fit within the FairShares model of enterprise?<br />
p Prof Ridley-Duff<br />
explaining the main<br />
characteristics of<br />
the FairShares multistakeholder<br />
mode<br />
A diverse co-op movement needs a variety of legal<br />
forms – and for multi-stakeholder co-ops, these<br />
include the FairShares model, says Prof Rory<br />
Ridley-Duff.<br />
Prof Ridley-Duff, in his a keynote presentation<br />
at the conference, invited delegates to switch to a<br />
multi-stakeholder mindset and look at how co-ops<br />
can support solidarity enterprises.<br />
He said the FairShares model is based on<br />
the assumption that the exclusion of primary<br />
stakeholders from member-ownership is a cause<br />
of contemporary poverty.<br />
The approach aims to bring together the people<br />
who established the organisation; the people who<br />
provide the labour; those who use the products<br />
and services; and the financial investors. All<br />
of them are investing different types of capital, be<br />
it financial, social or labour. A person could also<br />
invest different forms of capital into the business.<br />
Governance and legal systems need to<br />
recognise these contributions and reward them<br />
accordingly, said Prof Ridley-Duff, adding: “If you<br />
are constituted appropriately, you can offer shares<br />
to raise financial capital from the people inside<br />
and outside the organisation.<br />
“You can be a company or a co-operative to<br />
do that. And you can adopt this mindset across<br />
different legal traditions.”<br />
As a result, entrepreneurs get Founder Shares<br />
(or membership); workers get Labour Shares<br />
(or membership); trading commitments are<br />
rewarded with User Shares (or membership);<br />
and financial capital creation is rewarded with<br />
Investor Shares (or restricted funds to organise<br />
investments in the well-being of employees, user<br />
communities and/or public benefit).<br />
Prof Ridley-Duff argued that the FairShares<br />
model promoted by the Fair Shares Association<br />
was rooted in the history of co-operatives.<br />
The three models of thinking around consumer<br />
co-operation, social entrepreneurship and<br />
worker co-operation are key concepts within the<br />
FairShares model, he said.<br />
However, the FairShares model has its own<br />
values and principles. These are wealth and power<br />
sharing with primary stakeholders; specification<br />
of social purposes and auditing of social impacts;<br />
ethical review of the choices of goods and<br />
services offered, as well as the production and<br />
retailing processes; and social democratic models<br />
of ownership, governance and management.<br />
Some groups are already using FairShares<br />
models while operating as co-operatives. One<br />
example is Anyshares, a United States company<br />
that includes all stakeholder groups in voting<br />
and dividend profit sharing. The business aims to<br />
position itself as an alternative platform bringing<br />
together users and service providers.<br />
Similarly, Resonate, a co-op owned music<br />
streaming service, is jointly owned and managed<br />
by artists, listeners and record labels. Users pay<br />
to listen to a song – and after they pay to listen<br />
to it nine times, they can download it. With other<br />
providers, listeners have to listen to a song over<br />
100 times to own it. A platform co-op, Resonate<br />
also uses Blockchain technology to track and<br />
distribute payments.<br />
According to Prof Ridley-Duff, co-operative<br />
social entrepreneurship is more rooted in<br />
mutuality than in philanthropy. It also tends to be<br />
explored more within multi-stakeholder co-ops<br />
than the rest of the movement.<br />
“It is closely aligned with the development<br />
of a social and solidarity economy. It’s supportive<br />
of member participation in ownership and<br />
it expands the notion of trading beyond<br />
commodities and market,” he said, adding<br />
that the UK had yet to fully grasp the concept<br />
of multi-stakeholder ownership.<br />
He said that more studies and legislation were<br />
required to support the model, as well as having it<br />
included in education curricula.<br />
In his view, the FairShares model is a philosophy<br />
for creating and sustaining networks of solidarity<br />
enterprises that share power and wealth among<br />
their entrepreneurs, producers, consumers<br />
and investors.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 29
Denmark’s co-op movement looking for formal recognition<br />
While 37% of all housing in Denmark is provided<br />
through co-ops, re-marketing co-ops remains a<br />
big challenge for the movement.<br />
The CEO of co-op federation Kooperationen,<br />
Susanne Westhausen, spoke about the sector at<br />
the UKSCS conference in Sheffield, and said the<br />
challenges faced by co-ops in Denmark are similar<br />
to those in the UK.<br />
The country has no co-operative legislation,<br />
which means co-ops can register in any form<br />
they want and set out co-operative principles in<br />
their by-laws.<br />
Worker co-ops in particular are being perceived<br />
as old-fashioned but continue to enjoy a close<br />
relationship with trade unions.<br />
On the other hand, Denmark is home to some<br />
16,500 voluntary clubs and associations. There<br />
is a joke that if two Danes sit together for five<br />
minutes, they will start an association.<br />
“Denmark is the country of associations<br />
but people do not perceive them as business<br />
models, again due to a lack of legislation,” said<br />
Ms Westhausen. She explained that some co-ops<br />
were losing members and board members and<br />
then being sold. For consumer co-ops, a key issue<br />
is explaining to customers that being a member is<br />
different from just having a loyalty card.<br />
On the other hand, the young generation likes<br />
the idea of working together across countries.<br />
“The best way for them to learn is by doing trips<br />
to co-ops to get a co-operative experience,” she<br />
added. The country is also moving away from the<br />
welfare state, which could open the healthcare<br />
sector to co-ops and mutuals.<br />
In the absence of a legal definition of the social<br />
economy, allocating specific funding to co-ops<br />
is not possible, even when political players are<br />
in favour of promoting the sector, added Ms<br />
Westhausen.<br />
She thinks that in spite of these barriers, there<br />
are opportunities for the sector. Changes brought<br />
by the fourth industrial revolution are expected to<br />
result in higher numbers of people working part<br />
time or as freelancers – and co-ops can help them<br />
have more bargaining power.<br />
The UN’s Sustainable Development agenda<br />
gives co-operatives the chance to show how<br />
they can make a difference. New organic farming<br />
co-ops are also taking off in Denmark, where<br />
people are more familiar with organic products<br />
than they are with co-ops.<br />
Kooperationen is currently working on creating<br />
a co-operative certificate. The federation is a<br />
network of 92 member enterprises and 14,000<br />
employees, being the country’s main apex<br />
organisation for co-operatives. It provides<br />
professional legal advice and counselling within<br />
areas such as employment law, company law and<br />
construction law.<br />
p Susanne Westhausen<br />
shares the lessons of<br />
Danish co-operation<br />
qCopenhagen, a city in a<br />
‘country of associations’<br />
30 | <strong>OCTOBER</strong> <strong>2018</strong>
The past informs the present<br />
– The co-operative movement and anti-slavery<br />
At this year’s conference of the UK Society<br />
for Co-operative Studies, Nick Matthews,<br />
chair of Co-operatives UK and representative<br />
on the Co-op Group members’ council,<br />
gave a presentation inspired by the Group’s<br />
campaign against modern slavery. Its<br />
efforts have seen it lobby government and<br />
businesses to tackle the rise in forced labour,<br />
and devise the Bright Future programme,<br />
which offers work opportunities to survivors<br />
of the crime. Here, Mr Matthews argues that<br />
this anti-slavery ethos is embedded in the<br />
co-op movement’s history ...<br />
Last year, when the Co-op Group was awarded<br />
the Thomson-Reuters Stop Slavery Award for the<br />
great work of the Bright Futures programme in<br />
supporting former slaves, I wondered what our<br />
founders would have thought. Delighted that our<br />
values were still intact or horrified that slavery<br />
still existed?<br />
p The iconic CWS wheatsheaf<br />
I thought about the early trademark of<br />
the Co-operative Wholesale Society, the<br />
wheatsheaf with the motto “Labor and<br />
Wait”. Labor stood out because it was in the<br />
American spelling. It was suggested that this was<br />
a demonstration by the founders of the CWS of<br />
their commitment to the emancipation movement.<br />
It is generally accepted that ‘labor and wait’<br />
comes from the last line of the Longfellow poem<br />
the Psalm of Life.<br />
This raises a series of questions: were the<br />
early co-operators supporters of Lincoln and the<br />
Union forces? If the phrase was from Longfellow,<br />
why was it important and would anyone seeing it<br />
understand what it meant?<br />
In short, this is what I have found. Two ideological<br />
strands feed the early movement – Chartism and<br />
Christian Socialism. Both had a commitment to<br />
equality and extending the franchise at home and<br />
against slavery.<br />
The backdrop to the whole process of the<br />
formation of the CWS was the US Civil War and the<br />
blockade of the Southern ports by the Union navy.<br />
This prevented the export of cotton to Manchester<br />
and Liverpool. Prior to the civil war, there were over<br />
half a million operatives in the cotton districts in<br />
Lancashire and Yorkshire. By November 1862, over<br />
two thirds of them had been laid off. The misery<br />
caused has been referred to ever since as the<br />
Lancashire Cotton Famine.<br />
Co-ops were not immune to this economic<br />
pressure. There were around 120 co-op societies<br />
in the cotton districts. All lost trade and members.<br />
Some collapsed. I believe this must have been<br />
part of the pressure to form a Wholesale Society.<br />
The Manchester campaign in support of the<br />
Union came to a crescendo on New Year’s Eve in<br />
1862 as Lincoln’s proclamation freeing the slaves<br />
came into force on New Year’s Day. Two founders<br />
of the CWS, John Cooper of Rochdale Co-op and<br />
Edward Hoosen of Manchester Co-op, had called<br />
the meeting, and some 6,000 people turned up<br />
at the Free Trade Hall for the first meeting of what<br />
became the Union and Emancipation Society. They<br />
went in to be on the founding board of the CWS.<br />
So their anti-slavery credentials are clear. How<br />
well did they know Longfellow? Now, it is hard<br />
to appreciate just how popular he was. Before<br />
effective copyright law, huge quantities of his<br />
work were sold. He was the most popular poet in<br />
the country, with over 20 British publishers, easily<br />
outselling the likes of Wordsworth and Tennyson.<br />
His style of morally uplifting verse fitted the<br />
mood of the times. It is astonishing how many of<br />
his phrases have entered our language and there<br />
is no doubt the founders of the CWS would have<br />
been familiar with his work.<br />
So, it seems that it is true that as George Jacob<br />
Holyoake wrote, “Co-operative societies had no<br />
small share in enabling the people of the two great<br />
cotton spinning counties to resist the recognition<br />
of a slave dominion.”<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 31
It has become a familiar story: political fault-lines are opening up around<br />
the world, huge sections of the population are feeling disenfranchised,<br />
and reactionary populist movements are moving to fill the vacuum.<br />
Introduction by Miles Hadfield<br />
32 | <strong>OCTOBER</strong> <strong>2018</strong>
The upheaval following the 2008 crisis has led<br />
to the Brexit vote (see page 46-47), the election<br />
of Donald Trump, the electoral successes of far<br />
right parties across Europe, and the hold on power<br />
enjoyed by political “strongmen” such as Vladimir<br />
Putin, Recep Erdogan and Rodrigo Duterte.<br />
These all represent variations on populism –<br />
characterised by political academics such as Jan-<br />
Werner Muller as a form of identity politics that is<br />
critical of elites, anti-pluralist, and makes moral<br />
claim of representation.<br />
In his book, What is Populism, Muller warns:<br />
“The notion that we move closer to democracy<br />
by pitting a ‘silent majority’, which supposedly is<br />
being ignored by elites, against elected politicians<br />
is not just an illusion, it is a politically pernicious<br />
thought ... Populism is something like a permanent<br />
shadow of modern representative democracy, and<br />
a constant peril.”<br />
But there is also a more progressive strain of<br />
populism, as seen in the huge grassroots support<br />
Jeremy Corbyn in the UK, Bernie Sanders in the<br />
US, and the Syriza and Podemos parties in Greece<br />
and Spain.<br />
Muller points out that in North, Central, and<br />
South America, there has always been progressive<br />
strand of populism. This has influenced co-op<br />
history in these regions – for instance, in the US,<br />
a wave of co-operativism emerged from the 1880s<br />
populist movement The Knights of Labor.<br />
“The populists’ basic premise,’ writes Nathan<br />
Schneider in his new book Everything for Everyone<br />
(review, p48), is that opposing entrenched power<br />
and creating co-ops went hand in hand.”<br />
Now, the movement is developing its own<br />
radical responses to the world’s challenges, from<br />
the Cleveland model of local co-op economies, to<br />
the development of the platform co-op model to<br />
disrupt the tech economy. Meanwhile, the racial<br />
tensions in the US, which have worsened since<br />
Trump’s election victory in 2016, have seen a<br />
resurgence in the African American co-operative<br />
movement (p 44-45).<br />
But can these diverse strands be built into<br />
a coherent political programme? The co-op<br />
movement has been using the crisis to push its<br />
own cause, arguing for more democratic models<br />
of ownership in housing, transport, utilities and<br />
business. The hope is that co-operative ways of<br />
working, focused on potential employment growth<br />
sectors such as care work and the knowledge<br />
economy, can deliver a more stable future, with<br />
less inequality.<br />
In the UK, thinktanks have produced a series<br />
of policy documents for a reshaped economy,<br />
most recently last month's report by the Institute<br />
for Public Policy Research (IPPR) Commission<br />
on Economic Justice (page 44-45). These ideas<br />
are being echoed in grassroots meetings around<br />
the country. Last week in Manchester, there<br />
was an event discussing alternative models of<br />
home ownership, from campaign group Housing<br />
Futures.<br />
Salford’s Labour MP Rebecca Long-<br />
Bailey, the shadow business secretary,<br />
said “the housing crisis exemplifies<br />
inequality” in the UK. She said Labour<br />
planned to build a million new homes –<br />
half of them social housing – if elected,<br />
but that this would not be enough on<br />
its own.“We also need to investigate<br />
new models”, she said, such as co-op<br />
housing and co-ownership. This was<br />
part of plan to “diversify the economy”.<br />
“We need to investigate who<br />
owns the economy, and investigate<br />
whose interests it is run for,”<br />
she added.<br />
Neil McInroy, chief executive of the<br />
Centre for Local Economic Strategies<br />
thinktank, agreed there was a need<br />
for a variety of ownership models. “We<br />
need a plurality of forms to ensure<br />
there is not one monolithic entity to<br />
extract the wealth.”<br />
He told the meeting the global<br />
crisis had discredited the neoliberal<br />
consensus and left an “interregnum of<br />
ideas” – offering a space of alternative<br />
ideas of ownership to develop.<br />
“Things are coming together,” he<br />
said, “but we’re not there yet.”<br />
But will this be enough? Mr McInroy warned<br />
that such models need a supportive environment,<br />
arguing that community asset transfers, which<br />
had given responsibility to social housing tenants,<br />
had not worked.<br />
“It’s a good idea,” he said, “But in a time of<br />
austerity, it’s just an exercise in passing the buck.”<br />
He added: “We’ve got to listen more and try to<br />
co-design and co-produce” policies with people<br />
who had previously “had things done to them.”<br />
“The housing crisis exemplifies<br />
inequality ... We need to<br />
investigate who owns the<br />
economy, and investigate<br />
whose interests it is run for”<br />
Above: Rebecca Long-<br />
Bailey and Neil McInroy<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 33
CZECH COFFEE CO-OP AIMS TO PROVE THAT<br />
CO-OPERATION WORKS<br />
As with in other east European countries, many<br />
people in the Czech Republic associate co-ops with<br />
the former communist regime. Some still perceive<br />
co-operatives as old-fashioned, state-owned,<br />
unproductive enterprises.<br />
But in the small town of Kostelec nad Labem, in<br />
Central Bohemia, a coffee co-op is trying to show<br />
that co-operation works. The founders of Fair &<br />
Bio Coffee Roasters wanted to process Fairtrade<br />
coffee in the Czech Republic, rather than have it<br />
imported. In doing so, they are also reviving the<br />
co-operative business model.<br />
“The image of co-ops was very<br />
much damaged. Until now,<br />
they have been disregarded.<br />
There was a misconception that<br />
co-operation doesn't work and<br />
co-ops were rejected. It is<br />
getting better. Over the past<br />
five years, things have changed.<br />
People don’t laugh at us<br />
anymore,” she adds."<br />
The Czech co-op movement dates back to<br />
1847, with the formation of the Prague Food and<br />
Savings Society. Its purpose was similar to that of<br />
the Rochdale Pioneers – to provide high-quality,<br />
affordable food to people in industrial areas. Soon<br />
after, credit, agricultural and housing co-ops<br />
formed in Bohemia and Moravia.<br />
The downfall of the co-operative sector in the<br />
region started with World War II. Co-op staff were<br />
targeted and executed by the Nazi regime. And<br />
when the communists came to power in 1948,<br />
co-ops lost their autonomy and independence,<br />
becoming state-owned. New co-ops were set up<br />
but they belonged to the state and lacked the<br />
entrepreneurial aspect of the old societies. After<br />
communism fell in 1989, some co-ops did not<br />
manage to obtain ownership of their former assets<br />
and were disbanded.<br />
“In 1989, the collective way of doing<br />
things was rejected,” says Marketa<br />
Vinkelhoferová, a member and director<br />
of the Fair & Bio Coffee roasters. “We are now trying<br />
to explain that the collective democratic form of<br />
doing business is not evil and that co-operation is<br />
necessary for a successful way of doing anything.<br />
Not many people know that co-operative history is<br />
so rich.”<br />
She adds: “The image of co-ops was very<br />
much damaged. Until now, they have been<br />
disregarded. There was a misconception<br />
that co-operation doesn’t work and<br />
co-ops were rejected. It is getting better. Over the<br />
past five years, things have changed. People don’t<br />
laugh at us any more.”<br />
The multi stakeholder co-op has 25 members,<br />
some of them employees. There 12 workers, nine of<br />
whom have disabilities.<br />
“I like working in the roastery because of the<br />
beautiful smell of coffee,” says Filip, one of the<br />
employees with learning disabilities, who has<br />
been there since the start. His colleague, Lukáš,<br />
adds: “I love the friendly and relaxed atmosphere<br />
of the workplace.”<br />
Marketa is the president of the co-op’s board,<br />
which includes two other members. Regular<br />
members are also involved on a voluntary basis,<br />
helping out during busy periods, particularly at<br />
Christmas. To join the co-op, members have to<br />
invest €200 in the business.<br />
“We don’t recruit members. We work with<br />
people who want to become members and are<br />
highly motivated. We want committed members<br />
rather than a big membership pool. We expect<br />
support and involvement from them, as well as an<br />
understanding of our values.<br />
“We are part of the wider movement and we<br />
aim to create international contacts. Not much is<br />
known about co-ops in Central and East-European<br />
countries. We would like to let the world know.”<br />
CZ, Kostelec<br />
nad Labem,<br />
Central Bohemia<br />
25 members,<br />
12 workers<br />
Roasted in the<br />
Italian Style<br />
34 | <strong>OCTOBER</strong> <strong>2018</strong>
The co-op is a member of the Union of Czech<br />
and Moravian Manufacturing Cooperatives,<br />
the Association of Social Responsibility, the<br />
Decent Company platform, and RIPESS, the<br />
intercontinental network for the promotion of<br />
social solidarity economy.<br />
Ecumenical Academy – the non-governmental<br />
organisation that co-established the co-op –<br />
was a partner organisation in SUSY, a European<br />
initiative to promote the social and solidarity<br />
economy. Ecumenical Academy supports<br />
alternative solutions to the current economic,<br />
social and environmental issues both in local<br />
communities and at global level.<br />
Fair & Bio Roastery was one of the good practice<br />
examples included in the scheme. As part of the<br />
initiative, the partner organisations launched a<br />
series of videos showcasing good practices in the<br />
social and solidarity economy around the world.<br />
The co-op roasts around five tonnes of coffee per<br />
year. The coffee sold by Fair & Bio Roastery is 100%<br />
Arabica and comes from Latin America, Africa<br />
and Asia. It also offers a blend with Robusta. All<br />
coffee is Fairtrade certified and a large part of it<br />
is organic.<br />
Products include Italian-style roasted espresso<br />
and third-wave coffee, which is roasted less and<br />
emphasises floral and fruity flavours. The products<br />
are sold online, as well as to local businesses and<br />
shops, including zero-waste retailers. A significant<br />
percentage of customers are companies – who buy<br />
the coffee for gift sets or for their staff.<br />
“There is a lot more acknowledgement of<br />
Fairtrade than 10 years ago,” says Marketa.<br />
“People also respect the concept of organic<br />
agriculture. We don’t want to make ourselves<br />
cheaper to be more competitive because we<br />
“We combine global sustainability through our<br />
Fairtrade sourcing and transparent supply chains<br />
with local sustainability by providing jobs for local<br />
people and those disadvantaged”<br />
would need to save money from somewhere and<br />
we don’t want to abandon some of our values.”<br />
One of the main challenges faced when setting<br />
up was the lack of support available for co-ops,<br />
particularly in terms of access to capital, with a<br />
lack of ethical finance in the Czech Republic.<br />
Acquiring the roasting machine and other<br />
equipment required investment; the co-op<br />
obtained a grant from the EU Social Fund, but that<br />
did not cover the full cost.<br />
“Many people tend to say that grants are not<br />
good but we saw it as an initial investment. Social<br />
and solidarity economy enterprises, like us, have<br />
to be economically sustainable and cannot be<br />
running on grants,” says Marketa .<br />
Looking ahead, the co-op plans to grow<br />
sustainably, roast more coffee and increase the<br />
number of employees.<br />
“We would like to expand our offer one day to<br />
neighbouring countries like Poland, or Slovakia,<br />
but there are many more opportunities to take<br />
in our own country first. The environment is<br />
much friendlier now. More people are aware<br />
of environmental issues, especially after this<br />
hot summer. They are also supportive of local<br />
economies. We combine global sustainability<br />
through our Fairtrade sourcing and transparent<br />
supply chains with local sustainability<br />
by providing jobs for local people and<br />
those disadvantaged,” says Marketa.<br />
Members of the Fair<br />
& Bio team enjoy the<br />
relaxed and friendly<br />
atmosphere that comes<br />
from its co-op ethos<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 35
WHERE STATE AND CO-OPERATION MEET<br />
Above and below: A<br />
co-operative training<br />
session in Malawi<br />
(Photo: Co-operative<br />
College)<br />
“The 21st century provides the African cooperative<br />
movement with exciting and critical<br />
opportunities as the continent becomes the world’s<br />
second fastest-growing region.” So wrote the<br />
Honourable Vincent T. Seretse, chair of the Africa<br />
Co-operative Ministerial Conference, introducing<br />
the International Co-operative Alliance – Africa<br />
Co-operative Development Strategy 2017-2020.<br />
“If the movement and governments work<br />
together to support the co-operative enterprises,<br />
the industry will realise sustainable growth and<br />
development, and inspire Africa’s performance in<br />
distinct segments of the movement.”<br />
However, for many years, co-operatives in Africa<br />
struggled with a legacy of government intervention<br />
from both the colonial and post-colonial period.<br />
As noted by Hazel Johnson (Development Policy<br />
and Practice, The Open University) and Linda<br />
Shaw (the Co-operative College) in their 2014 paper<br />
‘Rethinking rural co-operatives in development:<br />
introduction to the policy arena’, this legacy had<br />
an long-lasting impact on their performance and<br />
limited their effectiveness.<br />
“Many co-operatives functioned as para-statals<br />
and were frequently captured by local elites,” they<br />
wrote. “Liberalisation and structural adjustment<br />
further weakened co-operatives that were<br />
previously dependent on the state.”<br />
They add that African co-operatives have<br />
remained strongly marked by their colonial<br />
legacies – not only in terms of the legal and policy<br />
environment but also by the sectors in which<br />
they operate. In eastern Africa, until recently,<br />
the dominant types of co-op have been those<br />
specialising in export crops such as coffee and<br />
cotton.<br />
Dr Johnson and Dr Shaw highlight a study of<br />
contemporary co-operatives in Africa published<br />
by the International Labour Organization which<br />
“argues that the British, Belgian and French<br />
colonial regimes left behind distinct legal<br />
frameworks, which are still apparent today. The<br />
A CASE STUDY FROM MALAWI<br />
Over the last six years, the co-operative movement in Malawi<br />
has been working to develop a national apex body, known as<br />
the Malawi Federation of Co-operatives (MAFECO) ... writes<br />
Dr Amanda Benson, research and projects officer at the<br />
Co-operative College. Supporting this project, among<br />
others, has been the Co-operative College, firstly through its<br />
Supporting Co-operatives in Malawi project (2012-2015) funded<br />
by the Scottish government, and, more recently, through the<br />
CEPEESM project (2015-<strong>2018</strong>).<br />
On a recent visit to the country, we (myself and Dr Sarah<br />
Alldred) met with the Malawi government’s registrar of cooperatives,<br />
Wisikesi Mkombezi, and his team to discuss the<br />
ongoing development of the country’s co-op movement.<br />
According to Mr Mkombezi, there are great changes taking<br />
place in the regulation of co-operatives; the Malawian<br />
government has ambitious plans to double the numbers of<br />
co-op members, driven in part from the top by ministers who<br />
attended the National Agricultural Fair and were impressed with<br />
how co-ops have been performing, especially in rural areas.<br />
“Every politician is talking about co-operatives, especially<br />
when they have visited co-ops and have seen how they are<br />
changing people’s lives,” he says. “Then they see them as a<br />
vehicle to change people’s lives for the better.”<br />
However, he is aware that the co-operative movement<br />
needs to be independent and not hampered by politics, and<br />
acknowledges that one of its strengths is that it does work<br />
independently.<br />
But this message of independence also needs to be received<br />
by members of the co-ops: that they are the owners and<br />
decision-makers behind the co-op movement, and that it is not<br />
controlled by government – there is sometimes a misconception<br />
that co-operatives are another wing of the government.<br />
Mr Mkombezi emphasises that even MAFECO is memberbased,<br />
and the co-op movement can put who they want at the<br />
head of the board: it’s in their power to act. “But you can’t force<br />
a concept on the people,” he adds. “First they must understand<br />
what a co-operative is.”<br />
Co-operatives are still used as a tool by the government.<br />
Their popularity has in resulted in a boost of support in using<br />
co-operatives to build primary industry, and has united the<br />
efforts of the Ministry of Industry, Trade and Tourism, the<br />
Ministry of Water, Agriculture, Irrigation and Water and the<br />
36 | <strong>OCTOBER</strong> <strong>2018</strong>
British model has been characterised as a ‘unified<br />
model’, for example, with one law for all types of<br />
co-operatives, a separate co-operatives ministry<br />
and a single national apex body.”<br />
They add: “Co-operatives were often co-opted by<br />
political parties. In socialist countries they became<br />
integrated into state-dominated agricultural<br />
systems while, in other countries, many<br />
agricultural co-operatives became dominated<br />
by big landowners and large scale farmers [...]<br />
However those agricultural co-operatives closely<br />
associated with the state suffered as a result of<br />
the withdrawal of state support and structural<br />
adjustment policies from the 1980s onwards<br />
with many failing or considerably reducing their<br />
activities.”<br />
The shift away from a government-led and<br />
controlled co-operative sector began in the<br />
1980s and 90s, with the liberalisation policies<br />
that started to remove government support and<br />
subsidy from co-operatives in many countries.<br />
And this was furthered in 1995 when, at its<br />
conference in Manchester, the International Cooperative<br />
Alliance adopted a Statement on the<br />
Co-operative Identity which firmly situated cooperatives<br />
as member-owned, democratically run<br />
and autonomous enterprises.<br />
In Africa, small-scale financial co-operatives,<br />
such as credit unions, developed later as<br />
relatively autonomous organisations – and more<br />
recently, the region has witnessed a ‘co-operative<br />
renaissance’, with the number of memberships<br />
and active co-ops growing significantly.<br />
According to the ICA – Africa, there are<br />
now three things that are fundamental to the<br />
future success of co-operative enterprises in<br />
the continent: data; cultural environment; and<br />
research and innovation.<br />
“We need a comprehensive, internationally<br />
comparable and consistent data set that adequately<br />
reflects the economic activity of the sector,” said<br />
outgoing ICA – Africa president, Stanley Muchiri.<br />
Mr Muchiri, who is also the chair of the Cooperative<br />
Bank of Kenya and vice-president of the<br />
ICA, adds that while “African governments now<br />
have a standard definition of what we mean by a<br />
Co-operative, they fail in providing guidelines on<br />
how it will be officially measured”.<br />
To resolve this, the Africa Co-operative<br />
Development Strategy 2017-2020 aims to engage<br />
governments to ensure government information<br />
accurately reflects all parts of the sector and does<br />
not exclude the large proportion of the industry<br />
that exports goods and services.<br />
“Diversity and innovation will define the future<br />
strategic growth of the co-operative movement,”<br />
he said.<br />
“This requires that we build on our long history<br />
of excellence in the arts and culture, sports, and<br />
the talent it nurtures, to develop an ecosystem that<br />
brings together co-operatives and culture with<br />
technology, research, and innovation.”<br />
Ministry of Finance to drive the rural industrialisation of<br />
Malawi. Mr Mkombezi acknowledges that one challenge facing<br />
the movement is resources.<br />
Co-ops have been singled out as a critical tool for Malawi’s<br />
development, but they are very under-resourced – and the<br />
resources that are available are spread out between lots of<br />
different organisations.<br />
John Mulangeni, our project manager in Malawi, said that one<br />
of the issues for the movement, and for joined-up approaches,<br />
is that there is no centralised point that holds data on cooperatives<br />
in the same way that data is collected on other<br />
enterprises (such as figures on membership, capital, how do<br />
they manage their post-harvest production activities etc).<br />
The ministry staff work in a very centralised way and this<br />
presents challenges when reaching out to the more rural areas.<br />
Mr Mulangeni believes the co-op movement in Malawi could<br />
learn a lot from the Tanzanian model, which is developing and<br />
moving forwards, especially as Malawi is currently updating<br />
its 1998 Co-operative Act. The draft Co-operative Bill is being<br />
debated and it is expected to be passed by the end of this<br />
financial year.<br />
The government’s policy is to promote co-ops, and while<br />
they still support other associations, they do emphasise<br />
that the preferred organisation is a co-operative one. A great<br />
recent example of this is the help that was given to a leather<br />
association. This enabled them to create a design studio, but<br />
also encouraged them to become a co-operative too. They<br />
certainly don’t hide their preference for organisations to be cooperatives<br />
to access support.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 37
AS THE WORLD BECOMES MORE POLARISED,<br />
CAN CO-OPERATIVE POLITICS OFFER HOPE?<br />
ARIEL GUARCO<br />
Across the world, we see economic inequality<br />
leading to disaffected populations. What is the<br />
role of co-operatives in offering an alternative<br />
to these people? Can co-operatives create a<br />
sense of belonging in these disadvantaged<br />
communities?<br />
We live in a time of enormous global challenges,<br />
in all kinds of areas: the environment, population,<br />
work, production, health and education. At<br />
the same time, we face challenges with citizen<br />
participation and political representation.<br />
For more than 120 years, the International<br />
Co-operative Alliance has upheld values and<br />
principles that promote the development of<br />
communities within a framework of democracy,<br />
justice and peace.<br />
"The world urgently needs<br />
forms of social organisation<br />
that prioritise caring for the<br />
environment and putting<br />
people at the centre of the<br />
economy. Otherwise, damage<br />
will be irreversible"<br />
With the aim of promoting strategic alliances,<br />
we’ve been talking to various international<br />
organisations. And by doing this, we have<br />
strengthened our relationship with the ILO and<br />
FAO – and we’re committed to the 17 Sustainable<br />
Development Goals.<br />
We know that there are more than one billion<br />
members of co-ops worldwide, and we have a<br />
presence on every continent and in almost all<br />
sectors of the economy.<br />
That's why we set out to improve region and<br />
sector integration; engage with members to better<br />
understand their suggestions and concerns, and<br />
make an impact on the public sector to create<br />
better policies and legal frameworks to develop<br />
co-operative enterprise.<br />
Additionally, we’re re-evaluating the role of<br />
data and statistics to get a better picture of our<br />
economic and social contribution in various parts<br />
of the world.<br />
Anca Voinea speaks to Ariel Guarco, president of<br />
the International Co-operative Alliance, and John<br />
Duda of US thinktank Democracy Collaborative,<br />
about the potential of the co-op alternative<br />
If we are an integrated movement, united<br />
in all its diversity, we will be in a stronger<br />
position for governments and other international<br />
organisations to listen to our proposals and<br />
warnings about the global situation.<br />
We can’t stress<br />
enough that the world<br />
urgently needs forms<br />
of social organisation<br />
that prioritise caring for<br />
the environment and<br />
putting people at the<br />
centre of the economy.<br />
Otherwise, social and<br />
environmental damage<br />
will be increasingly<br />
irreversible.<br />
Since the founding<br />
of the Alliance in<br />
1895, right up until<br />
today, co-operatives<br />
have transcended<br />
wars, economic crises,<br />
different political<br />
regimes and natural<br />
disasters. And in all<br />
these years they have<br />
demonstrated that,<br />
in the midsts of many<br />
different circumstances,<br />
they always serve people<br />
and their communities.<br />
In 2012, the United<br />
Nations recognised<br />
that co-operatives can<br />
help build a better world. We have demonstrated<br />
the ability to generate work, produce goods and<br />
services, distribute wealth and improve people’s<br />
quality of life. We do it with our own resources<br />
and tools, and sometimes in association with our<br />
governments.<br />
Clearly, the current economic model will<br />
not solve the inequalities that it has created,<br />
and governments alone cannot provide all the<br />
answers. So co-operatives remain a genuine and<br />
effective tool for achieving a sustainable world.<br />
Ariel Guarco, president<br />
of the International<br />
Co-operative Alliance<br />
38 | <strong>OCTOBER</strong> <strong>2018</strong>
JOHN DUDA<br />
There is confusion over what populism is –<br />
some politicians use populist speeches but<br />
implement policies that help corporations –<br />
such as tax cuts. How would you define it?<br />
Populism is a response to a situation when the<br />
power to establish political reality shifts away from<br />
being managed entirely through elite governance<br />
and towards “the people”.<br />
That doesn’t mean that elites are necessarily<br />
out of the loop in a populist moment, it just means<br />
that the centre of gravity has shifted to a broader<br />
mass of people, and that elites can continue to<br />
do quite well by adopting strategies that ground<br />
legitimation for their programme in this mass.<br />
But populism isn’t always just a strategy of elite<br />
capture – the Populist movement in the late 19th<br />
Century in the US, for instance, was an impressive<br />
bottom-up movement for a systemic alternative,<br />
“the co-operative commonwealth”.<br />
Ultimately, it matters who “the people” are<br />
in a populist moment — and who is left out.<br />
Certainly, the more reactionary and xenophobic<br />
populist strategies on both sides of the Atlantic<br />
are terrifying. But after decades of a technocratic<br />
neoliberal consensus about the acceptable<br />
boundaries for the political imaginary, it’s a relief<br />
to see truly just and equitable systemic alternatives<br />
on the table as well — and it’s populism that’s<br />
made this possible: a moment of delegitimisation<br />
and danger that’s also an incredible opportunity.<br />
Are we witnessing a return of the “isms”? And<br />
does this pose a threat to liberal democracy?<br />
It depends on what “isms” you mean. Certainly<br />
a well-organised, well-resourced, and chillingly<br />
effective strain of authoritarianism is on the<br />
march: it’s a real threat to democracy, and should<br />
be confronted and fought.<br />
But I’m more ambivalent about liberalism, which<br />
is also, of course, an “ism”. The reliance on the<br />
market as the core institution of civil society has<br />
not proved capable of uniformly delivering results<br />
that are compatible with equity or democracy, let<br />
alone ecological survival. A return of some kind of<br />
socialism is not just compatible with democracy, it<br />
may well be the precondition for its survival.<br />
What’s needed is a re-envisioned political<br />
economy built around democratic outcomes as a<br />
consequence of its structure and operation – not<br />
trying to retrofit democracy on top of an economic<br />
system programmed to concentrate power.<br />
Because we are talking about a complex<br />
system with a lot of different operative scales,<br />
this means, for me, the least problematic of all<br />
the “isms” – pluralism. Democratised ownership<br />
and control of many kinds, interlocking and<br />
overlapping – nationalisation, municipal “sewer”<br />
socialism, worker co-ops, consumer co-ops, multistakeholder<br />
co-ops, public/co-op partnerships,<br />
and so on, all at different scales regrounding<br />
the economy in the lives of the public and in<br />
communities. Our current system is in crisis<br />
because a financialised liberalism can’t really<br />
deliver public welfare or sustain communities,<br />
so the choice increasingly becomes one between<br />
a politics based in reactionary hatred and fear<br />
defending what has yet to be stripped away,<br />
or a movement reconstruction of the economic<br />
foundations of democratic life.<br />
Can co-ops create a sense of belonging for<br />
alienated communities? Has this happened<br />
in Cleveland, where Democracy Collaborative<br />
helped establish the Evergreen Cooperatives?<br />
Certainly they can! Co-operatives are an economic<br />
foundation for democracy precisely because they<br />
carve out a space of autonomy and control that<br />
undercuts the fear inherent in precarious life in<br />
a failing system. But to do so, they've got to be<br />
designed with inclusion in mind.<br />
In Evergreen, there’s been a decision to include<br />
the excluded in the hiring and membership<br />
process. That mean working to develop pipelines<br />
and supports for people with barriers to<br />
employment – who may have been incarcerated,<br />
or are refugees, or have simply been long-term<br />
unemployed, with a job and additional benefits.<br />
The challenge is scale – Evergreen is growing,<br />
but it’s just a couple of hundred workers. If we<br />
want to truly work at the scale of communities, we<br />
need solutions that give everyone that same sense<br />
of economic security and agency. So that means<br />
more and bigger co-ops, certainly, but also all the<br />
other institutions of the democratic economy we<br />
can build, as quickly as we can build them.<br />
Democracy<br />
Collaborative hosted<br />
a roundtable in<br />
Cleveland, Ohio,<br />
which blossomed into<br />
birthed an economic<br />
inclusion strategy in<br />
the city’s low income<br />
communities known<br />
as the Evergreen<br />
Cooperative Initiative<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 39
CO-OPERATION AND CIVIL RIGHTS: BUILDING<br />
BLACK ECONOMIC POWER IN THE USA<br />
This month, NCBA-CLUSA, the apex body for<br />
co-ops in the USA, hosts its Impact Conference –<br />
including a session on the way “communities of<br />
colour are increasingly utilising the co-op model to<br />
meet their needs and create their own solutions”.<br />
Conference organisers note: “The need for an<br />
economic renaissance is already dire, and the<br />
data shows that the racial wealth gap continues<br />
to grow. Innovative strategies are necessary to<br />
address complex disparities around access to<br />
food, housing, financing and employment.”<br />
The event brings together several co-ops<br />
from communities of colour including the<br />
Association for Black Economic Power (ABEP),<br />
which is working to establish the Village Trust<br />
Financial Cooperative, Minnesota’s only black-led<br />
financial institution.<br />
“The need for an economic<br />
renaissance is already dire,<br />
and the data shows that the<br />
racial wealth gap continues to<br />
grow. Innovative strategies are<br />
necessary to address complex<br />
disparities around access to<br />
food, housing, financing<br />
and employment”<br />
formed around Birmingham, Alabama in the<br />
1880s, a decade which also saw the Colored<br />
Farmers’ Alliance, grow out of populist labour<br />
organisations like the Knights of Labor.<br />
A key figure in the movement’s history, W E B<br />
Du Bois, rose to prominence in the early 20th<br />
century. A civil rights icon who helped found<br />
the National Association for the Advancement<br />
of Colored People in 1909, he carried out a study<br />
of black co-operation, and formed the Negro<br />
Co-operative Guild in 1918. More associations<br />
followed, such as the Young Negroes’ Co-operative<br />
League in 1930 and over the following decades,<br />
farmer’s co-ops, credit unions, buyers clubs,<br />
and health insurance mutuals were established.<br />
Formed in 1967, the Federation of Southern<br />
Cooperatives has helped create and/or support<br />
more than 200 co-ops and credit unions.<br />
If these co-ops were a response to troubled<br />
political and economic conditions, they often met<br />
with more oppression. Dr Gordon Nembhard has<br />
described how these efforts often met with hostility<br />
Black selfdetermination<br />
through worker<br />
co-operatives<br />
W E B Du Bois, a key<br />
figure in the history of<br />
African American<br />
co-operation<br />
Established last year “as a way to use our<br />
economic power as a form of resistance, to build<br />
the financial resilience of our communities, and<br />
insulate against extraction and divestment”,<br />
the project is a response to the fatal shooting of<br />
Philando Castile, a 32-year-old-black man, by a<br />
police officer in July 2016, in St Paul, Minnesota.<br />
Black co-operation is enjoying a resurgence in<br />
the US, with notable examples such as Cooperation<br />
Jackson, which is working to create a new economy<br />
in the Mississippi city.<br />
But, as academic Dr Jessica Gordon Nembhard,<br />
an expert on African American co-operation, has<br />
pointed out: “African Americans have a strong but<br />
hidden history of co-operative ownership in the<br />
face of market failure and racial discrimination.”<br />
This developed through the second half of the<br />
19th century, with co-ops such as the Chesapeake<br />
Marine Railway and Dry Dock Company,<br />
established in 1865. Black co-op villages were<br />
40 | <strong>OCTOBER</strong> <strong>2018</strong>
– whether in the form of increased rents or refused<br />
bank loans, or acts of violence and murder.<br />
This is a situation which persists: in her foreword<br />
to Jackson Rising, a study of the Cooperation<br />
Jackson movement, Rukia Lumumba describes<br />
efforts by the Mississippi state government to<br />
“remove local control from the hands of the largely<br />
black city council of Jackson”.<br />
But efforts continue<br />
to create a co-operative<br />
city economy, run on<br />
radical lines, with black<br />
self-determination<br />
in Jackson. A leading<br />
light of the movement,<br />
Chokwe Lumumba,<br />
served briefly as mayor<br />
from 2013 until his death<br />
the following year. Last<br />
year, his son Chokwe<br />
Antar Lumumba was<br />
elected to the office.<br />
Just before his death,<br />
Chokwe Lumumba said: Chokwe Lumumba<br />
“We want to accomplish<br />
a revolutionary<br />
transformation. We are party to statistics which<br />
demonstrate that our people, black people in<br />
particular and probably the majority of the<br />
Mississippi population, are at the worst end<br />
of all the vital statistics. When it comes to the<br />
discussion of oppression in America, we’ve been<br />
experiencing the worst of it for a long time. What’s<br />
exciting to me is the prospect of going from worst<br />
to first in a forward-moving transformation which<br />
is going to take groups of dispossessed black<br />
folks here – and others – and make us controllers<br />
of our own destiny.<br />
“We are not foolish enough to think that it is a<br />
mission that can probably be accomplished here in<br />
the absence of fundamental movement in the rest<br />
the world, but we think we can start that movement<br />
and help carry it forward, and help advance it in a<br />
really powerful way. So that’s what excites us.”<br />
“ When it comes to the discussion<br />
of oppression in America, we’ve been<br />
experiencing the worst of it for a long<br />
time. What’s exciting to me is the<br />
prospect of going from worst to first<br />
in a forward-moving transformation<br />
which is going to take groups of<br />
dispossessed black folks here<br />
and make us controllers of<br />
our own destiny”<br />
Asked last year how the movement<br />
should respond to the Trump administration, Dr<br />
Gordon Nembhard said: “We can survive with<br />
strong Black organisations promoting and<br />
educating about co-ops and providing co-op<br />
business education and development at local<br />
levels; and by creating co-ops that support and<br />
supply each other regionally and nationally;<br />
and engage in federations that provide needed<br />
financial, educational, distribution, marketing,<br />
and policy support.”<br />
Below: Mandela<br />
Grocery was set up to<br />
in a neighbourhood<br />
in West Oakland,<br />
California, where there<br />
was a lack of healthy<br />
food stores<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 41
HOW TO UNLEASH A NEW ECONOMY? CO-OP<br />
PARTY PREPARES FOR ANNUAL CONFERENCE<br />
October <strong>2018</strong><br />
The Co-op Party hosts<br />
its annual conference<br />
from 12-14 October, to<br />
discuss ways to meet<br />
its goal of doubling the<br />
size of the co-operative<br />
economy.<br />
Earlier<br />
this<br />
year, the Party<br />
commissioned a report<br />
by the New Economics Foundation (NEF),<br />
Co-operatives Unleashed, which identified policy<br />
areas for achieving this target, and it will discuss<br />
these ideas further at the conference. .<br />
It will also present “a new generation of cooperatives<br />
who are expanding the co-operative<br />
movement into new and innovative areas of<br />
business and the economy”, alongside sessions on<br />
housing and energy, schools and social enterprise.<br />
On Brexit, members given a chance to vote on<br />
the Party’s policy. At a fringe breakfast event on<br />
Saturday, Andrew Adonis and Eloise Todd make<br />
the case for a people’s vote on the final deal,<br />
followed by a debate.<br />
Party chair Gareth Thomas MP told the News:<br />
“Given the significance for the country it’s only<br />
right our members should have a vote to give them<br />
a say.”<br />
He said the other the big issue on the agenda is<br />
the economy. “We’ll discuss the NEF report, plus<br />
our work on community wealth building.”<br />
The Party had taken shadow chancellor John<br />
McDonnell to Preston to see some of the being done<br />
work there under the co-op council model of local<br />
service commissioning, said Mr Thomas. “We’ll<br />
update on this in the economy debate.”<br />
He added: “The scale of inequality in the country<br />
is that something has got to change. The levels of<br />
inequality, is one of the contributory factors to the<br />
divisive politics we’ve got at the moment.<br />
“Part of the response, until we can get a Labour/<br />
Co-operative government, is encouraging local<br />
councils to do what they can to make a difference:<br />
the community wealth building being done in<br />
Preston is impressive. In government we will want<br />
to make it easier for councils to keep their wealth<br />
local.”<br />
Mr Thomas said the Party wanted to “democratise<br />
the utilities”, bringing mutual principles to the<br />
water and energy industries “reflecting what has<br />
happened in the US and Germany that would help<br />
keep more of the wealth that’s generated in local<br />
people’s hands”.<br />
He added: “We<br />
have dialogue within<br />
the shadow cab. John<br />
McDonnell said two<br />
weeks ago he would take<br />
on board our idea for<br />
companies with more<br />
than 250 employers to<br />
give an ownership stake<br />
to workers.<br />
“The NEF report is our<br />
effort to get some input<br />
into how you do that.<br />
We are now taking that<br />
document out to the rest<br />
of the co-op movement<br />
to see how you would do<br />
that on a practical basis.<br />
“That also involves<br />
talking to [shadow<br />
business secretary<br />
Rebecca Long-Bailey, to Jeremy Corbyn, about<br />
getting those ideas into the next Labour manifesto.<br />
We’re also getting those ideas a proper airing in<br />
Parliament, and it would be nice to get broadcasters<br />
to give us party political broadcasts so we can bring<br />
those ideas forward.<br />
“We’ve got good relations with the Labour Party<br />
to get those ideas adopted.”<br />
Keynote speakers at the conference are:<br />
Vaughan Gething AM,<br />
Welsh government cabinet secretary for health<br />
and social services<br />
Rebecca Long-Bailey MP,<br />
Shadow chief secretary to the Treasury<br />
Marvin Rees,<br />
Mayor of Bristol<br />
Paddy Lillis,<br />
General secretary, Usdaw trade union<br />
The main guest at the evening party will be:<br />
Carolyn Harris,<br />
Deputy leader, Welsh Labour<br />
42 | <strong>OCTOBER</strong> <strong>2018</strong>
To find out more details of what's<br />
happening at the conference and to register<br />
for tickets, visit: s.coop/cooppartyconf18<br />
WORK TO BE DONE BUT ALSO HUGE OPPORTUNITIES<br />
Claire McCarthy<br />
General secretary<br />
We always thought it would be tough to top<br />
our centenary conference but with the Party<br />
continuing to grow in size, profile and influence<br />
we look ahead to this year’s conference – entitled<br />
‘Unleashed’ - with ambition and purpose.<br />
The Party is unashamedly ambitious for<br />
the co-operative movement. We believe that a<br />
substantially larger co-operative sector in the UK is<br />
critical to building an economy where wealth and<br />
power are shared; and where the rewards for hard<br />
work are distributed more fairly. That is why, earlier<br />
in the year, we commissioned the New Economics<br />
Foundation think tank to do an independent<br />
report setting out a roadmap for doubling the<br />
size of the co-operative sector. Their report<br />
‘Co-operatives Unleashed’ sets out a radical but<br />
practical way forward.<br />
It has been exciting over the last few months<br />
to see the ideas in the NEF report being debated<br />
and adopted beyond the co-operative movement,<br />
including in the recent proposals from the<br />
Commission for Economic Justice. The power<br />
of collective ownership is coming into the<br />
mainstream – it is being unleashed.<br />
It is that sense of radical yet practical ambition<br />
that is our inspiration as a Party and is at the heart<br />
of this year’s conference. We want our delegates,<br />
visitors, speakers and other participants to come<br />
to the event ready to think big for our Party and<br />
our movement and to leave on Sunday inspired<br />
and equipped to make change happen.<br />
During the weekend, we will have an important<br />
discussion about Britain’s future relationship with<br />
our European neighbours. We will debate a detailed<br />
document that seeks to address the key issues for<br />
the movement, and for our communities, arising<br />
from some of Brexit scenarios. In addition, the<br />
Party’s NEC want to hear the views of our members,<br />
on how we should deploy our campaigning<br />
resources going forward, including whether the<br />
Party should support a public vote on the decision<br />
to leave the EU on the final terms proposed<br />
by the government.<br />
So, as we approach our first conference of our<br />
second century there is a great deal of work to<br />
be done, but also huge opportunities ahead.<br />
We wouldn’t have it any other way.<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 43
WORKER OWNERSHIP ON THE AGENDA AS<br />
MCDONNELL WELCOMES THINKTANK REPORT<br />
New plans<br />
would require<br />
all companies<br />
employing<br />
more than 250<br />
workers to set up<br />
ownership funds<br />
Labour has announced plans to require all<br />
companies employing more than 250 people to set<br />
up “ownership funds”, giving workers financial<br />
stakes in their firms and increasing their influence<br />
over how they are run.<br />
Shadow chancellor John McDonnell told the<br />
Observer newspaper the move would deliver<br />
greater equality by forcing an “irreversible<br />
shift in wealth and power in favour of<br />
working people”.<br />
Mr McDonnell, who said turmoil over<br />
Brexit could trigger another general election,<br />
"The aim would be to<br />
give more people a share<br />
of capital and to spread<br />
economic power and<br />
control in the economy<br />
by expanding the decision<br />
rights of employees in the<br />
management of companies”.<br />
wants to introduce the legislation in his first<br />
year as chancellor. He will outline the plans,<br />
which could mean workers receiving dividends<br />
to boost their incomes, in a speech to the<br />
TUC conference in Manchester on Tuesday.<br />
He said the move “will ensure that in large<br />
companies, in addition to rewarding workers with<br />
wages, they will reward them with shares that<br />
will go into a pool that will allow them to have an<br />
ownership role".<br />
Announcing his plans – which follow lobbying<br />
from MPs in Labour's sister party, the Co-op<br />
Party – Mr McDonnell cited a report published<br />
by the Institute for Public Policy Research (IPPR)<br />
Commission on Economic Justice last week which<br />
included ideas to give millions of people “a greater<br />
stake and voice in their workplaces”.<br />
The IPPR said “the aim would be to give more<br />
people a share of capital and to spread economic<br />
power and control in the economy by expanding the<br />
decision rights of employees in the management<br />
of companies”.<br />
Alongside proposals to rebalance the economy,<br />
such as the establishment of a national investment<br />
bank and the creation of clusters of tech<br />
industries around the country, the IPPR says all<br />
IPPR also<br />
suggests having<br />
two worker<br />
representatives<br />
with companies<br />
with more than<br />
250 employees<br />
44 | <strong>OCTOBER</strong> <strong>2018</strong>
"If the commission can attract<br />
pluralistic, non-partisan<br />
political support for its<br />
plan then there is real hope.<br />
We share the commission’s<br />
understanding of where co-ops<br />
fit into this wider agenda<br />
for economic reformation”<br />
The report can be<br />
downloaded at:<br />
www.ippr.org/research/<br />
publications/prosperityand-justice<br />
companies with more than 250 employees should<br />
have at least two worker representatives on<br />
the board.<br />
The report also suggests firms should be<br />
required to put a percentage of profits into an<br />
employee fund that would build up over time,<br />
giving the workforce an increasing say in key<br />
decisions. Workers would not be able to cash in<br />
shares, but could receive dividends from the fund<br />
to boost their pay.<br />
The discussion puts employee ownership<br />
models back in the spotlight. The Conservative<br />
Party had briefly flirted with the idea of worker<br />
representation on company boards, with<br />
Theresa May advocating the model during<br />
her leadership pitch before backtracking last<br />
year. And Labour had included plans for more<br />
democratic ownership structures in its 2017<br />
general election manifesto.<br />
The ideas in the IPPR report have already<br />
received support – with some caveats – from the<br />
co-operative movement.<br />
James Wright, policy officer at apex body<br />
Co-operatives UK, which was consulted for the<br />
report, said: “It was important to represent the<br />
co-op sector through our response to the<br />
commission's call for evidence – and we're<br />
delighted to see our positive influence manifest<br />
itself in the final report. We certainly applaud<br />
the commission for its ambition and for<br />
emphasising the intrinsic links between inclusive<br />
economics, ecology, productivity and wellbeing.<br />
"If the commission can attract pluralistic,<br />
non-partisan political support for its plan then<br />
there is real hope. We share the commission's<br />
understanding of where co-ops fit into this wider<br />
agenda for economic reformation.”<br />
He added: “We agree with some aspects<br />
of the policy prescriptions for co-ops; for<br />
example on legislative reform, buyouts and<br />
common wealth creation. But what's missing<br />
is a clearer emphasis on behavioural change<br />
and improving co-op knowledge and know-how<br />
in business ecosystems and communities.”<br />
The Employee Ownership Association said<br />
that having a greater range of business<br />
ownership structures is "key" to developing<br />
a thriving UK economy. It said: "Start by<br />
empowering the individual with a ripple effect<br />
on productivity and resilience for businesses,<br />
regional economies and the wider economy.”<br />
"What's missing is a clearer emphasis on behavioural change<br />
and improving co-op knowledge and know-how in business<br />
ecosystems and communities.”<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 45
TIME IS TICKING FOR BREXIT<br />
– BUT CAN IT BRING A NEW CO-OP VISION?<br />
The clock is ticking towards 29 March 2019<br />
when – barring a political earthquake – Britain<br />
will leave the EU.<br />
As uncertainty grows over what kind of deal<br />
– if any – will be forthcoming, leading figures in<br />
the co-op movement are taking steps to lessen the<br />
impact on the retail sector, where there is a fear<br />
profits will slump if supply chains dry up.<br />
Since the Leave vote in 2016, the Co-operative<br />
Group has kept a close eye on developments and<br />
has lobbied for a ‘co-operative Brexit’ – making the<br />
best of the situation while taking steps to mitigate<br />
the consequences on the movement as a whole.<br />
A spokesperson said: “We’re monitoring the<br />
progress of Brexit, as any responsible business<br />
would – but there is a lot of uncertainty in the market<br />
and it’s clearly in everyone’s interests for a deal to be<br />
agreed which is mutually agreeable to both the UK<br />
and the EU.<br />
“That said we believe the Co-op has some degree<br />
of protection, even from a hard Brexit. Our fresh<br />
meat is 100% British. That flows across ingredients<br />
and in some of the core areas like ready meals<br />
and sandwiches.<br />
“We are also working closely with suppliers on<br />
the contingency plans they have. This can give us<br />
assurance and also influence how we may adapt<br />
our promotions, offers and ensure that we can<br />
keep our shelves stocked as best we can in any<br />
degree of disruption that may emerge.”<br />
"Our analysis suggests the impact on co-ops<br />
of Brexit is not too different from the impact on<br />
business as a whole. But there are particular risks<br />
for key sectors in which co-operatives are strong,<br />
notably farming and retail, which does mean the<br />
challenge of Brexit is a challenge to the wider<br />
health of the co-operative movement"<br />
The Co-operative Group is also seeking<br />
approval from the government as an Authorised<br />
Economic Operator, giving quicker access<br />
to customs procedures and the right to fasttrack<br />
shipments through security both in<br />
and outside the EU, avoiding border delays<br />
in the event of a hard Brexit<br />
Jo Whitfield, CEO Co-op Food said: “Since the<br />
Leave vote was announced we’ve extolled the<br />
virtues of a co-operative Brexit, one which would<br />
“We have to co-operate in our supply chains,<br />
we have to co-operate to compete, we have<br />
to co-operate to go sustainable, and we have<br />
to co-operate to survive”<br />
provide clarity and fairness in terms of trade and<br />
labour movements between the UK and the EU.<br />
That view has strengthened over the subsequent<br />
months and our hope remains that a deal will still<br />
be reached.<br />
“If a no-deal Brexit occurs, the view from many<br />
industry commentators is there may be impacts to<br />
food supply over the short-term. As such we, like<br />
the rest of the retail sector, are taking prudent<br />
steps to mitigate the impact for our customers and<br />
members, over and above the existing protection we<br />
have in place.”<br />
Co-operatives UK secretary general Ed Mayo and<br />
his team have been lobbying government on behalf<br />
of members since the referendum, developing<br />
a positive scenario for how co-operatives can<br />
flourish in a post-Brexit UK and articulating a<br />
series of key forward-looking principles to be<br />
respected in negotiations.<br />
He says: “Our analysis suggests the impact on<br />
co-ops of Brexit is not too different from the impact<br />
on business as a whole. But there are particular<br />
risks for key sectors in<br />
which co-operatives are<br />
strong, notably farming<br />
and retail, which does<br />
mean the challenge of<br />
Brexit is a challenge to<br />
the wider health of the<br />
co-operative movement.<br />
“The retail sector<br />
faces the challenge<br />
of securing supply<br />
chains in the absence<br />
of information on what<br />
will happen to produce at the border. As a nation,<br />
we eat around half of what we produce. If crisis hit,<br />
we could produce maybe 70% but not all we would<br />
need to get by. At present, 80% of fresh vegetables<br />
and 30% of fresh fruit is imported from the EU.<br />
That is an opportunity for UK farmer co-ops and<br />
retail co-ops to connect.”<br />
He added: “The decision by the Co-op CEO, Steve<br />
Murrells, early in his leadership to move to 100%<br />
British meat in own-brand products, is looking<br />
Britain will<br />
leave the EU<br />
Uncertainty<br />
remains: will we<br />
strike a deal?<br />
No-deal is<br />
expected to<br />
have a dramatic<br />
instant impact<br />
on food supplies<br />
46 | <strong>OCTOBER</strong> <strong>2018</strong>
like an inspired move, giving the Co-op something<br />
of an advantage.”<br />
Back in March, Co-operatives UK organised<br />
a roundtable so agri-co-ops could meet the<br />
farming minister, DEFRA and industry experts,<br />
and won the case for a new £10m fund for farmer<br />
co-operatives. According to Mr Mayo, the new<br />
Agriculture Bill mapping the future of farming<br />
outside the EU reflects both positive wins for the<br />
sector and continuing areas of risk.<br />
With the possibility of a no-deal Brexit looming,<br />
last month, Co-operatives UK issued guidelines for<br />
all co-operatives, large or small, recommending<br />
boards consider the risk of a “disorderly” Brexit.<br />
These include looking at sales, marketing,<br />
logistics, legalities, tax, HR and the implications<br />
of recruiting or employing EU nationals, as well as<br />
cross-border trade with EU countries and the risk<br />
of obstacles to supply chains.<br />
Official advice from the EU on Brexit and UK<br />
business echoes the call from Co-operatives UK<br />
for contingency plans and preparation for possible<br />
short or medium-term disruption to supply<br />
chains and revenues. Across the country that is<br />
now being taken on board by the co-operative<br />
movement with the focus on partnership working<br />
across the movement as key to survival in a<br />
post-Brexit world.<br />
Mr Mayo said: “A no-deal is expected to have a<br />
dramatic instant impact on food supplies in the<br />
UK. The retail sector is one of those which will<br />
be impacted and knock-on implications in terms<br />
of food availability and consumer behaviour are<br />
ones that start to move into uncharted territory.<br />
“There is no co-op crystal ball, and the effect<br />
Brexit negotiations seem to have had on experts<br />
is to leave them equally unsighted and uncertain<br />
on what will come next. At the same time, it<br />
is interesting and hopeful that a debate has<br />
started on the future of food and farming beyond<br />
Brexit – one we have contributed to on behalf of<br />
our members.<br />
“We have to co-operate in our supply chains,<br />
we have to co-operate to compete, we have to<br />
co-operate to go sustainable, and we have to<br />
co-operate to survive.”<br />
80% of fresh<br />
vegetables and<br />
30% of fresh<br />
fruit is imported<br />
from the EU<br />
The Co-op<br />
Group uses<br />
100% British<br />
meat in ownbrand<br />
products<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 47
BOOKS<br />
Travelling the world to find a new co-operative commonwealth<br />
Everything For<br />
Everyone:<br />
The radical<br />
tradition that is<br />
shaping the next<br />
economy<br />
Nathan Schneider<br />
(Nation Books,<br />
<strong>2018</strong>) £21.50<br />
Below: Prime Produce,<br />
is a cooperativelyrun,<br />
multi-use space<br />
in New York. (Photo:<br />
primeproduce.coop)<br />
Right: unMonastery.<br />
(Photo: unMonastery)<br />
The notion of a global co-operative effort to<br />
democratise economies and meet the economic<br />
and environmental crises facing the world is an<br />
exciting one – but it begs certain questions. For<br />
instance, how do we convince young activists<br />
looking for an alternative that co-operativism is the<br />
answer? How do we link the small platform start-up<br />
in Europe and an agri-co-op giant in the USA into a<br />
single movement?<br />
There are some answers in Nathan Schneider’s<br />
new book, where he looks for a new co-operative<br />
commonwealth. It’s a lively read, fizzing with<br />
ideas, mixing familiar reference points such as the<br />
Rochdale Pioneers with more obscure examples of<br />
co-operation, going all the way back to prehistory,<br />
but it never loses sight of the seriousness of the<br />
task in hand. “If we’re to take on existential market<br />
externalities such as poverty and climate change,”<br />
he warns, “we need companies capable of seeing<br />
the world in the way people do.”<br />
Times are promising for the co-op model.<br />
Schneider points out that it is well suited to digital<br />
ways of working, while grassroots activism has used<br />
the language of co-operation – from the Movement<br />
for Black Lives and environmental campaigners to<br />
the “upstart politicians” of the resurgent left like<br />
Jeremy Corbyn and Bernie Sanders.<br />
But he warns that while digital networks can<br />
empower peer producers, they are also leading to<br />
“unprecedented global monopolies and previously<br />
unimaginable feats of surveillance”. So how can<br />
the co-op commonwealth win the day?<br />
To answer that question Schneider goes searching<br />
through history, and around the world. He finds<br />
co-operative ideas woven into the early Christian<br />
church – and draws a line to the unMonastery, a<br />
commune of tech researchers formed in 2014, which<br />
installed itself, along Benedictine lines, in the<br />
ancient Unesco site of Matera in Italy, and tried to<br />
devise better ways of organising the world.<br />
The unMonks brought together a range of<br />
cultures – from art to protest – but although<br />
Schneider finds a lack of clarity to their project, he<br />
adds: “I don’t think we can ... imagine a co-operative<br />
future without these errant, fumbling stories”.<br />
He finds other historical models revived by<br />
co-operators alongside the monastic tradition,<br />
describing how New York non-profit Prime Produce<br />
harks back to the medieval workers’ guilds to create<br />
– in its own words – “wholeheartedly organised<br />
co-op supporting entrepreneurs, educators, and<br />
artists who share values of service and hospitality”.<br />
He ties these stories in with more familiar chapters<br />
from co-operative history – the radicalism of Robert<br />
Owen, George Jacob Holyoake or Horace Greeley;<br />
the co-operative response to the Great Depression<br />
in the 1930s; the strong element of co-operation<br />
in the African American civil rights movement, as<br />
inspired in the early 20th century by W E B Du Bois,<br />
and follows these threads to the present day, with<br />
platform co-ops and other co-op disruptors and<br />
entrepreneurs, or the activism of the Co-operation<br />
Jackson movement.<br />
Can these ideals coalesce into a new<br />
co-operative commonwealth? Schneider sees<br />
contradictions, pointing to the “unapologetic<br />
consumerism” encouraged by major players like<br />
Coop Italia’s Ipercoop stores, and to the subsidiaries<br />
of multinational worker co-ops like Bologna-based<br />
SACMI where co-op values are not promoted.<br />
But he adds: “Constructing a commonwealth<br />
means insisting on principles while tolerating<br />
compromise.”<br />
And he argues that old established co-ops offer<br />
lessons from across the years to a new generation.<br />
“Co-operators today neglect the local, diverse,<br />
compromised legacies at their peril.”<br />
48 | <strong>OCTOBER</strong> <strong>2018</strong>
EXTRACT: The Fall of the Ethical Bank<br />
Paul Gosling’s The Fall of the Ethical Bank, has just been published by Co-op Press. In this extract,<br />
he examines the links between the Co-op Bank and government. He looks at lobbying efforts for new<br />
legislation to benefit the co-op movement - which had some unfortunate, unforeseen consequences when<br />
it came to the Bank’s ruinous takeover of the Britannia Building Society in 2009 ...<br />
The evidence that there had been long-term thinking<br />
behind [the Co-op Bank’s takeover of the Britannia<br />
Building Society] comes from the passing of the socalled<br />
Butterfill Act (properly called the Building<br />
Societies (Funding) and Mutual Societies (Transfers)<br />
Act 2007).<br />
This piece of legislation allowed, for the first time,<br />
different types of mutuals to merge. The proposer of<br />
the Bill was Sir John Butterfill. When interviewed by<br />
the author he declined to say who was behind the<br />
legislation, simply indicating that his constituency<br />
contained business operations owned by large<br />
mutuals, which needed greater flexibility.<br />
This was true – he represented Bournemouth,<br />
which was home to a very large call centre run by<br />
the Liverpool Victoria Friendly Society. However,<br />
Liverpool Victoria denied to the author that it had<br />
any involvement or interest in the Act.<br />
Sir John told me (for an article in Co-operative<br />
News) that the link-up between Co-operative<br />
Financial Services (CFS) and Britannia is “absolutely<br />
the type of thing we are looking at”. He added: “I<br />
don’t think you will find them alone.”<br />
But behind the scenes, one well-placed source<br />
said, it was the Co-op Group that had pushed to<br />
ensure the Bill was drafted and then enacted.<br />
And the Group (through its Co-operative Financial<br />
Services subsidiary, which owned the Co-op Bank)<br />
was one of only two institutions to use the Act.<br />
In fact, it might be said that the Act has been a<br />
disaster for the co-operative and mutual movement.<br />
While the intentions were good, the applications<br />
have been bad.<br />
It certainly seemed to make sense for friendly<br />
societies and building societies to merge, for<br />
example – except that there is no sign that there is<br />
any interest in those two sectors in coming together.<br />
The lesser-known application of the Butterfill<br />
Act involved the Kent Reliance Building Society,<br />
a struggling organisation that over-loaned in the<br />
boom times and then was at risk when the downturn<br />
came.<br />
While other damaged building societies sought<br />
rescues within the sector, Kent Reliance used the<br />
Butterfill Act in a very different way.<br />
The private equity business JC Flowers had sought<br />
entry into the UK’s banking market. In order to do<br />
this, it established a supposedly mutual subsidiary,<br />
which then effectively took over Kent Reliance. This<br />
combined business now operates as OneSavings<br />
Bank and is a FTSE 250 plc. The Butterfill Act had<br />
demutualised a building society – not at all what<br />
lawmakers had been told it would be used for.<br />
The second application of the Butterfill Act was<br />
the Co-op Bank’s takeover of the Britannia Building<br />
Society.<br />
The Fall of the Ethical Bank is out now. More details at<br />
THENEWS.COOP/FALLOFTHEETHICALBANK<br />
<strong>OCTOBER</strong> <strong>2018</strong> | 49
DIARY<br />
FROM LEFT: Lord Victor Adebowale CBE,<br />
Co-op Group director and CEO of Turning<br />
Point, is the keynote speaker at Cooperatives<br />
UK’s Practitioners Forum (22<br />
Nov); Rebecca Long-Bailey MP will speak<br />
at the Co-op Party Conference (12-14<br />
Oct); City Hall, Cardiff, is the venue for<br />
the Social Business Wales Conference<br />
(27 Sep); and Stir to Action’s What If We<br />
Ran It Ourselves? Community Ownership<br />
workshop is on 27 Oct<br />
27 Sep: Social Business Wales<br />
Conference <strong>2018</strong><br />
A free annual conference to support<br />
local businesses with aspirations to<br />
grow and be more sustainable. Speakers<br />
include Dai Powell (HCT Group), Guy<br />
Singh-Watson (founder, Riverford Organic<br />
Farmers) and Ken Skates (economy<br />
secretary for Wales).<br />
WHERE: City Hall, Cardiff<br />
INFO: wales.coop/sbwc<strong>2018</strong><br />
4 Oct: Co-operative Councils’ Innovation<br />
Network Annual Conference<br />
A chance to hear how co-operative<br />
councils across the country are working<br />
with local people to build strong and<br />
resilient neighbourhoods. Including a<br />
keynote from Steve Reed,MP – honorary<br />
president of the CCIN and shadow<br />
minister (digital, culture, media<br />
and sport).<br />
WHERE: Croydon<br />
INFO: ccin<strong>2018</strong>.eventbrite.co.uk<br />
12-14 Oct: Co-operative Party Conference<br />
A weekend of inspiring stories, practical<br />
ideas and skills you can use to begin<br />
transforming your communities,<br />
unleashing the power of ideas to<br />
build a fairer, stronger Britain.<br />
WHERE: Mercure Bristol Grand Hotel<br />
INFO: s.coop/cooppartyconf18<br />
13 Oct: Social Saturday<br />
Social Saturday champions social<br />
enterprises that are making a difference<br />
in communities, set up to trade for a<br />
social purpose and using business to<br />
create a more equal society. Events will<br />
be held around the country.<br />
INFO: socialenterprise.org.uk/<br />
socialsaturday<br />
18 Oct: International Credit Union Day<br />
A day to reflect on the credit union<br />
movement’s history, promote its<br />
achievements, recognise the hard work<br />
and share member experiences.<br />
The <strong>2018</strong> theme is ‘Find Your<br />
Platinum Lining’.<br />
INFO: woccu.org/events_and_<br />
engagement/icuday<br />
25 -28 Oct: Social Cooperative<br />
International School<br />
#SCIS<strong>2018</strong> consists of three thematic<br />
sessions and one international seminar.<br />
Each thematic session consists of a<br />
theoretic introduction on the topic,<br />
the presentation of best practices and<br />
a workshop to deepen the participants’<br />
knowledge on different aspects of<br />
social co-operative and social<br />
enterprise activities.<br />
WHERE: Hotel Royal Continental, Naples<br />
INFO: s.coop/2ai3t<br />
27 Oct: What If We Ran It Ourselves?<br />
Community Ownership<br />
What are community businesses and why<br />
are they on the rise? How can you work<br />
out if you could start one (or more!) in<br />
your community? How can you fund them<br />
to get going and keep going? And what<br />
challenges will you face along the way?<br />
Hosted by Stir to Action.<br />
WHERE: Restore, Oxford<br />
INFO: www.stirtoaction.com/workshops<br />
7-8 Nov: Locality Convention<br />
Join hundreds of inspiring members,<br />
partners and people working in the<br />
community, voluntary and social<br />
enterprise sectors to unlock the<br />
power of community.<br />
WHERE: Bristol Marriott City Centre<br />
INFO: locality.org.uk/events/convention/<br />
22 Nov: Co-operatives UK<br />
Practitioners Forum<br />
The Practitioners Forum offers<br />
professional training for people operating<br />
in key roles in co-operative businesses.<br />
The event is made up of a series of<br />
specialist forums: communications;<br />
finance; governance; HR; and<br />
membership. This year’s keynote speaker<br />
is Lord Victor Adebowale CBE.<br />
WHERE: The Studio, Manchester<br />
INFO: s.coop/29xlr<br />
50 | <strong>OCTOBER</strong> <strong>2018</strong>
Tickets<br />
from<br />
£120<br />
Practitioners Forum<br />
Training and networking for co-op<br />
professionals operating in communications,<br />
finance, governance, HR and membership.<br />
22 November, The Studio, Manchester<br />
www.uk.coop/pf
Be in charge of your<br />
energy today<br />
We’re a member-owned business, which<br />
means for just £1 you could own your own<br />
energy supplier.<br />
Have a say in the decisions your energy<br />
supplier makes. Join us.<br />
www.cooperativeenergy.coop/coopnewsoctober