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Co-op has totally lost its way

Admitting that it has lost touch with “its customers and members and with the communities in which it operates”, the Co-op is at a crossroads. After the near collapse of its bank, the Co-op is asking anyone and everyone to help determine the organisation’s future direction.

Crucial to its history and current identity, the Co-op makes a big contribution, via its own political party, to the Labour Party. The two parties maintain an electoral alliance – candidates who want to stand on the Co-op ticket have to be members of the Labour Party and appear on ballot papers as Labour Co-operative. 

The Co-operative Party is completely dependent on its income from the group’s trading activities. In 2012 the group donated a total of £805,000 to the party and its councillors. This included donations to 32 Labour and Co-operative MPs, as well as a one-off £50,000 grant to the office of the shadow cabinet.
 
At first sight, consulting widely by opening up a questionnaire to whoever wants to spend 20 minutes answering the questions might seem like a democratic move, but:

Q. where does it leave the more than 6 million members who’ve loyally stood by the organisation, liking and respecting its principles for decades?
A. Left by the wayside.

Euan Sutherland became group chief executive last May, from a career in for-profit companies including Coca-Cola, Curry’s and Superdrug. Peter Hunt, the former general secretary of the Co-operative Party, accuses him of threatening the abolition of the party.

The question that’s worrying the Co-operative and Labour parties is this one:

Q. To what extent do you think it is appropriate or inappropriate for big businesses to donate money to political parties?
A. It won’t stop huge donations to the Tories from the oil and banking industries.  But it does attempt to bury the Co-op’s ethos by equating it with all other businesses. According to the answers to the wide-open questionnaire, it could lead to the end of the Co-operative and Labour parties. 

Over the years, the democratic process has been largely reduced to becoming part of the corporate branding, giving its members a sense of belonging.  You won’t find many members even knowing how they could attempt to influence the big, or even small decisions. Those that have tried, for example, to get the Co-op to source some of its food offering locally have been disappointed, despite its claims to be in favour of a sustainable society and economy. So questions on that issue don’t impress.

Q. Is this questionnaire a return to democracy, or a threat to it?
A. A threat.

The co-operative movement came to prominence as an attempt to defend the livelihoods of workers being wrecked by the industrial revolution in the 19th century. Today, around the world co-operatives are being widely promoted as the antidote to the effects of the global crisis. Millions of people are once again coming to the conclusion that the unsustainable for-profit chase after growth is a dead-end and has to be replaced.

But that isn’t an option offered in the questionnaire. You can agree or disagree with the idea that the Co-op “is not just for profit”, but not whether it should be not for profit at all. You can agree or disagree with statement that “the Co-op supports and drives growth in the local economy”, but not whether this kind of growth is a bad or a good thing.

But there is an open-ended question you can answer:

Q. What, if anything, should The Co-operative do to encourage more people to shop with it?
A. Become a not-for-profit enterprise run by its members through a participative democratic process. Campaign to ensure that all enterprises follow a similar model, ending the for-profit exploitation of people and planet.

Gerry Gold
Economics editor
19 February 2014

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Your Say


Simon Grant says:

Maybe this is one of the reasons why "co-operative" no longer seems to be a positive watchword, but has been overtaken by "collaborative", "sharing" and "peer-to-peer" or P2P.

I remain thoroughly sickened by what happened to the Co-op bank -- it seems that all one has to do is let effective governance slip, and -- hey presto -- your organisation is now under the control of the interests of global capital. Sigh.

But maybe there are really subtle and clever ways round this...

Jeremy S Mills says:

We have to end this belief that profit is the only way to success.


Joe Taylor says:

Thanks Gerry - well said.


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