The success of co-operatives

2012 has been the United Nations International Year of Co-operatives, and at the end of October celebrations will culminate in a festival in the City of Manchester. The year of the festival seems well timed, considering the recent strength of co-operative organisations.

This strength was demonstrated just two months ago when the the The Co-operative Banking Group spent around £400m (possibly rising to £800m) on the purchase of a large number of Lloyds branches - a deal that increased the Co-operative Group share in the current account market to around 7% (BBC, 2012). These successes have not been limited to banking either. Farming Co-operatives of various sorts have been starting up and expanding (Bourne, 2012); in the Basque Country, Mondragon, a co-operative working in machine assembly, has laboured on and protected its employees even during the worst of the financial crisis (Burridge, 2012).

And it seems that (at least a part) of the UK Government has started to take notice. In January the Liberal Democrats advanced proposals to put workers closer to company decision making processes (Clegg, 2012) - a move to counter the re-emergence of the mismanagement that has been strongly tied to the causes of the financial crisis.

Co-operatives, building societies, credit unions: these organisations have yet to be perfected. Each have had their share of issues throughout the past decade, even if they have shown themselves to be very competitive. Last summer the Co-operative Group began seeking a buyer for parts of its insurance arm and just last month claimed worse than expected profits.

But in the face of the most recent financial meltdown, people are taking a fresh look at how to get democratic values into the heart of business. The reasons are twofold: it is primarily the long-awaited next step in the advance of social democracy, but its also serves as a means of building greater stability into businesses. Co-operatives, thanks to their resilience, provide a sound foundation for building towards those aims.

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References:
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+ BBC's 'Co-op to buy 632 Lloyds bank branches'; 19 July 2012.

+ Nick Bourne's 'Fruit and vegetable community co-ops rise to 350 in Wales'; on the BBC; 9 May 2012.

+ Tom Burridge's 'Basque co-operative Mondragon defies Spain slump'; on the BBC; 14 August 2012.

+ 'Nick Clegg calls for a 'John Lewis economy'' on the BBC; 16 January 2012.