Robin Murray

Reviewing co-operation_Mayo

 

How things could be done differently

 

This is a chapter from the forthcoming book being produced by the Robin Murray Reading Group

By Ed Mayo

There is a story that once upon a time in a town in the far north of England, the machines came. They took over and people were enslaved to serve them. In a smoky, rainy town of twenty five thousand, people lived hard lives, with long hours and they died young. They died at home, on a meagre diet of oats, onion porridge, potatoes and treacle. They died in the streets, wearing rags. They died in the workplace, at the hand of machines to make clothes for others. The average span of life for the people of the town was a mere twenty one years.

As time went on, there was resistance. A strike against the machines and the machine lords, the mill owners, failed. Two friends made a commitment to each other, to do or to die and they each persuaded a dozen more to sign up and act together. Most were not long past their own twenty first birthday. In deep midwinter, with the skies dark and Christmas only days away, they gathered in a townhouse off a narrow street called Toad Lane. They opened the doors to a front room, to sell what people wanted at prices that could be afforded – butter, sugar, flour, oatmeal, candles. The needs of people could come first, they said, and not the needs of the machines and their owners. These were the ‘Rochdale Pioneers’. The year was 1844 and they had shown how things could be done differently. They had started the world’s first modern co-operative enterprise.

Every story needs a narrator. In the case of the Rochdale Pioneers, the real story of their struggle and eventual success was of course longer and even more dramatic. Their storyteller was George Jacob Holyoake. In 1857, he completed the book Self-Help by the People: history of the Rochdale Pioneers. This helped to spread the word. In the six years that followed the publication of Holyoake’s book, two hundred and fifty one retail co-operative societies were established across Britain – just under one new society every week. Year seven and a co-operative store was operating in Africa, the first of many that emerged right around the world. Today, there are Rochdale schools, Rochdale streets, Rochdale settlements named after the Pioneers, because their success in doing things differently inspired so many others, as it were, to do the same.

A co-operative is an enterprise that is owned in partnership by those involved in the business itself, from self-help start-ups of people working together through to national and international businesses. Today, there are, according to the International Co-operative Alliance, close to three million co-operatives on Earth. According to the writer Iain M Banks, we will also see future co-operatives across the galaxy, although that is another story, one of science fiction. In this world, around 12% of people are members of co-operatives, which together support the livelihoods or provide work for around 10% of the employed population. The three hundred largest co-operatives generate 2.1 trillion USD in turnover, each providing the services and infrastructure that people need to thrive. 


Fair trade, carbon and co-operation

This story of co-operation has always attracted visionary storytellers and the UK economist Robin Murray was one. Robin’s involvement in the co-operative sector was long and most engaged in the field of fair trade, in itself a story of doing things differently. Among other things, Robin was one of the participants in a trade union, co-operative and solidarity conference in London in 1985 that spurred the founding of the Third World Information Network (TWIN and later, when the first coffee beans arrived in 1987 from producer co-ops overseas, TWIN Trading). His involvement in fair trade, marrying the practices of economic exchange with the dialogue of cultures and possibilities of organizational design, represented a passion that continued for the rest of his life.

I had known of Robin as I had had a modest involvement in fair trade myself. Around 1989, I was then a couple of years out of university, working for a development campaign group, WDM, when I met two people each thinking big about global justice. Martin Newman was working for the creative agency Imagination and Richard Adams was co-founder of the Christian fair trade pioneer Traidcraft. My family was a regular user of produce from Traidcraft and their recycled toilet paper ruled at home when I was a child. Richard was concerned about a crisis in traditional Fairtrade produce and the need to find new consumers for new high quality products. Martin was seized with the idea of a mainstream consumer label as a guarantee of provenance in terms of producer benefits. Here were two conversations that came together and I joined a small team committed to developing the concept.

The Fairtrade Mark that resulted learned from the Max Havelaar coffee, sold in the Netherlands and co-developed by the UCIRI cooperative in Mexico, but looked to add to this with explicit criteria that could be accredited, to make Fairtrade possible anywhere. With Belinda Coote, then of Oxfam, I had a go at the first draft of these criteria, and I also helped to shape the brand identity, coming up with the joined-up term Fairtrade as a single word that we could then trademark.

Later, from 1992 to 2003, I led the New Economics Foundation, a think tank born out of protests against the G7 world leaders coming to London. In both circles of fair trade and radical economics, Robin was a contributor and a leader. But we hadn’t spent much time together, we hadn’t worked together and that changed one evening late in October 2009 in South London. This was a ‘carbon party’. As an aside, I have to put inverted commas around the words, because this was a social event, done differently, that has not yet taken off around the world, or even outside of the small South London street that is home to Janet and Robin Stott. The spirit of it, though, is a brilliant one. The Stotts started carbon parties as an annual way to get together with friends, to compare our household carbon emissions and to socialise, each bringing food and a spreadsheet of our life in greenhouse gases over the previous twelve months.

So one Saturday evening, with carbon data tracked on a large sheet, I fell in to talking to Robin Murray and quickly asked his advice on a new project I was embarking on. On the Monday, I was taking up a new, dream role, as Secretary General of the national association of co-ops, Co-operatives UK. The previous person in post, Dame Pauline Green, was to become the President of the International Co-operative Alliance. So our discussion was a focused one – how the UK economy could be run differently, on co-operative lines. My question to him was simply put, but complex to answer: what was the way forward for the co-operative sector?


Reviewing co-operation

So, two days before starting work at Co-operatives UK, I had made my first decision. Alongside a host of other distinguished affiliations, such as the London School of Economics (LSE) and the Young Foundation, Robin agreed to the offer to act as an Associate of Co-operatives UK, a link he maintained though all his following years, and to complete a review of co-operative development in the UK.

The brief that we agreed was to assess the current state of co-operative development in the UK in relation to the opportunities for innovation and growth in co-operation and co-operative models of enterprise. The initial focus was to be on the existing co-operative development infrastructure and how it could be strengthened. But it quickly became apparent that the infrastructure had no great desire to ‘be reviewed’, facing extraordinary pressures of resources and priorities on a day to day basis. At the same time, there was a distance between what was in place to support co-operatives and the wider question, as Robin put it, “of how the broader changes in private and public services driven by the revolution in information technology and parallel social changes opened up spaces for co-operative innovation and expansion both in new sectors and within the co-operative economy itself.” In addition, with shifts in economic patterns that were present internationally rather than just in the UK and with exemplars of co-operative action that were far stronger in many countries overseas than the UK, despite its long heritage, the brief we agreed also took an international and an internationalist perspective on the question of the way forward. The outcome of the Review was to be the production of an implementable co-operative development plan for discussion within the co-operative movement. 

The work started in dialogue as Robin criss-crossed the country to meet practitioners working in the field of co-operatives and co-operative development. He attended a wide range of meetings, regional and national, of the UK co-operative development bodies, including the Co-operative Development Network, a Co-operative Development Panel hosted by Co-operatives UK, the Federation of Progressive Co-operators, the Co-operative Futures Conference in Swindon and the sector-wide Co-op Congress. He also participated in meetings and visits set up by Co-operatives and Mutuals Wales for Welsh co-operatives to meet primary producer and fair trading co-ops from India, Africa, and South and Central America. 

At Co-operative Congress in Plymouth in the Summer of 2011, Robin presented his findings and stayed talking with co-operative development practitioners in the bar with characteristic charm and politeness until 3am in the morning. His charm, politeness and patience were needed and tested because of two cultural traits he encountered in the UK co-operative sector of the time. These were traits born out of proud traditions of self-help but ones that had suffered through long years of exposure to being marginal and marginalised. These were first, an insularity – a world of insiders characterised by a defensive identity – and second, a suspicion of intellectuals. What gave him hope and where his subsequent findings were most enthusiastic was where this focus on the bluff practicality of co-operation could be found to be allied with vision, purpose and ambition. 

In late 2011, he delivered on the commission that I had asked for. The report Co-operation in the Age of Google was hugely influential here in the UK and overseas. He started the report, harking back to those who saw the chance to do things differently:

 

“Just as the pioneers of Toad Lane started their project in the midst of a railway boom and the ruin of an industry, so co-operation today is facing a new generic technology that is destroying old industries and creating new ones as it goes. As in the 1840s and again in the 1920s a financial frenzy has accompanied the rise of the new sectors, creating a bubble that has collapsed into a slump. What we can now see with hindsight is that these depressive pauses were a time of transition, when an old world was dying while a new one was forming to take its place.”

 

The traditional pillars of the 20th century economy – the great centralised corporations and welfare administrations – he argued were being hollowed out or bypassed. Adapting the words of Marx and Engels, into a more open form, he argued that what once felt solid is now being remoulded. Which forms will become dominant, he said, is not yet clear - their emergence is contested and there are alternative paths of development:

 

“Much depends on which path is taken. That will determine how far the new information economy can spread its benefits throughout the economy or will be used to consolidate the existing structures of economic and political power. It will also shape the prospects and process of co-operative development. For co-ops have always flourished best in decentralised economies, and one common pattern across the economy is the return of the micro.”

 

Co-operation in the Age of Google suggested that we are living at a time of profound transformation. The information and communication revolution, widespread concerns about private sector greed, public sector finances and impending climate chaos present a wide range of possibilities for co-operative expansion. But he argued that the co-operative sector is not yet in a position to make the most of these opportunities. It needs to be more innovative, more integrated, more internationalist, to get better infrastructure and to find ‘the idea’ that can mobilise support for co-operation.

The central relevance of co-operation is accelerated by the wider changes in technology, culture and the economy that we are seeing: 

 

“The informal information economy is open and global. It is driven by interest and enthusiasm rather than money. The bulk of its traffic is free. It is taking time to digest the implications of these changes, and for those involved to work out what rules are necessary to govern behaviour. Some have seen it as a new form of the commons, and looked at codes of behaviour that have been developed by those using common land or fishing grounds. But this informal economy is more than sharing a common resource, for with the web the resource is unlimited. It is a site for relationships, and where joint projects are involved, it requires the kind of qualities found in those pioneer communities where everyone worked together to raise the roof of a home.

It is growing with the speed and diversity of a tropical forest. It is informal and astonishingly inventive. It shares many of the same values and practices of formal co-operatives, and opens up numerous possibilities for a meshing between them. William Morris’s News from Nowhere depicted a world based on mutualism that for more than a century was seen as utopian. But in the last decade it has emerged as a reality not on the banks of the Thames but in the world of the web.”

 

 Co-operative innovation

To summarise 146 pages and ten recommendations, his answer for me to the question of the way forward was ‘co-operative innovation’. As I defined it in the work that followed, this could be innovation in co-operative form, innovation in product, process or service aligned with the characteristics of a co-operative, or innovation and its diffusion more widely by or among co-ops. The recommendations of the review in fact helped to spur and inspire specific innovations both directly and indirectly. A passionate supporter of the case for co-operative education, for example he argued for the establishment of a Co-operative University. This is a concept which is now close to reality through efforts by the Co-operative College. After considerable preparation, an application was submitted in 2019 with a wide range of partners for it to have degree-awarding powers.

Innovation was not a new concept for the co-op sector. My list of UK co-op innovations over the twentieth century include: the first self-service food store; the first retailer to enter food manufacturing; the first eight hour work day (in 1901 and it wasn’t until ninety seven years later that working hours in the UK were limited by law to 48 hours); the first minimum wage; the first national retailer to engage in large-scale farming to generate produce for sale; the first bicycles sold as a retail product at a national level; and the introduction as a mass consumer product of funeral prepayments. If you look internationally, of course you can cast the net more widely. It was a co-operative effort for example that started a revolution in green energy. The wind is a constant companion to communities on the low-lying Jutland peninsula. In 1980, with oil prices rising, three families in Ny Solbjerg near Aarhus - the Lauritsens, Vangkildes and Sorensens - decided to form a co-operative to install a 55kW wind turbine. Within two decades, co-operatives like theirs had made Denmark a world leader in renewable energy, installing nine out of ten turbines and helping to create the world’s largest turbine industry. The equivalent of just under a third of Denmark’s electricity now comes from renewable energy. With climate change a spur to action, wind is now the fastest growing energy source in the world.

But, as Robin’s review showed, the UK co-operative sector had lost the disruptive, innovative bent to do things differently that it had once held. As evidence, he pointed to the extent to which co-operative methodologies had been adapted for use outside of the formal co-operative sector. Omnibus survey research I commissioned for Co-operatives UK alongside his review, reinforced these findings. The data revealed that, at the time, 37% of UK adults believed that co-operatives are innovative, less than for companies more widely and that 40% of adults believed that co-operatives are old-fashioned, compared to 19% of wider companies.

And yet the conditions were appropriate, arguing for a renewal of co-operative enterprise through social and commercial innovation. Indeed, Robin pointed to the role of co-operation in the process of innovation itself, including the field of collaborative innovation – an offshoot of the field of open innovation, in which the focus is on the capabilities and connections that can generate and commercialise new ideas outside of the traditional boundaries of a single firm or formal partnership. As a result of this work and the dialogue across the co-operative sector that resulted, the Board of Co-operatives UK agreed that I should start a national programme of work on co-operative innovation. For a small organization, it was a big ambition.

 

Robin Murray on the future for the Co-operative Movement, filmed at the Co-operative Congress 2011.

 

Prizing innovation

The first initiative to follow was a national innovation challenge prize on collaborative consumption. During 2012, the United Nations International Year of Co-operatives, Co-operatives UK delivered the Buy Better Together Challenge Prize, in partnership with the Department of Business, Innovation and Skills, as a competition to inspire new models of co-operative purchasing. The proposed objective of this prize was “to identify different models of collective purchasing which generate better quality or price of goods and services for consumers, can be sustained and have the most potential to create social benefits”. The prize money was £60,000 to include business mentoring for highly rated projects and £15,000 for the overall winner. 

There was a total of 110 applications, including 13 from established co-operatives (11.8%) with the remainder being new enterprise proposals. There were applications from all UK regions. 6 were shortlisted and, following a period of mentoring for these, the winner was announced in November 2012 by the Liberal Democrat Business Minister, Jo Swinson MP. This was the Northern Housing Consortium, with its ‘Smarterbuys’ scheme. This uses joint purchasing and online ordering, linked to affordable loans from partner credit unions at a local level, to assist disadvantaged people when they need to buy essential goods, from kitchen appliances to beds. This was seen to offer a competitive alternative to high-cost predatory lenders on the high street and online. ‘Fair Food Carlisle’ was awarded the runner-up prize for their expansion project to bring co-operative buying of local food into the workplace. Smarterbuys used the award and related publicity to develop their work further and to spread awareness of their offer with affordable loans and products to help more consumers. It now works in partnership with 110 social housing providers, with a reach through to one million tenants in the UK.

The model of challenge prizes is of course now an established part of the innovation toolkit. What was distinctive about this as a first UK Co-operative Innovation Prize was not just that it focused on co-operative enterprise solutions, but that it was designed to promote co-operation rather than competition between the entrants, with a free flow of information and events to bring participants together to learn from each other and build a community of knowledge and practice around collective purchasing. The learning from the initiative was fed through into three subsequent co-operative innovation prizes: a prize by Co-operative Development Scotland for co‑operative consortia (enterprise-owned co-ops); a £5 million fund launched by the UK Government to support collective action on energy; a 2013 Co-operative Innovation Prize, run by Co-operatives UK, in partnership with the Carnegie UK Trust, focusing on the challenge of sustaining local media businesses. For this latter project, a series of eight workshops were held around regions and nations of the UK, with two hundred participants, showcasing examples of innovation in the media sector, such as the West Highland Free Press. At present, local newspapers in the UK are disappearing at a rate of more than thirty a year, but there is some evidence that demand for high quality, local news remains strong, so the challenge was formed around the use of co-operative models as a different business model for the sustainability of local news. Twelve enterprises were developed out of this programme, drawing on support from the Carnegie UK Trust.

A further challenge prize opened in 2014 for young co-operators. This was designed and led by a youth co-operative enterprise, AltGen with support from Co-operatives UK. Through grassroots networking and inspired campaigning, the small team behind the prize engaged with over 3,000 students and graduates at careers fairs, through a series of workshops, events, drop in sessions, with follow up contact through social media. The approach was to promote co-operatives as an alternative career pathway in which young people can collaborate with others to create meaningful work they are in control of. This was seen as just the beginning of a wider campaign to empower young people to create a more equal and sustainable economy through setting up co-operative businesses. When the window for applications closed, thirty four proposals for new co-ops had been submitted, with fifteen taken forward for support, with expert input from the UK’s wider worker co-op network.

Think Sector

The challenges and patterns of scaling up in the context of innovation emerged as a key theme in two related initiatives that Robin took up as an Associate of Co-operatives UK. What emerged was a complement to his earlier work on co-operatives, which took a systems-based approach, looking at culture, knowledge and technology. In short, it was to ‘think sector’.

The first of these was to participate in a cross-Atlantic academic network, BALTA, out of Canada, along with colleague and fellow Associate of Co-operatives UK, Pat Conaty, co-author of the 2012 book The Resilience Imperative. This network focused on exploring and modelling approaches for the diffusion of social innovation and the distinguished team behind the programme, including John Restakis, Mike Gismondi and Mike Lewis from Canada, went on to develop the first free access global online course on co-operative economics, Synergia, run in 2019 with Athabasca University.

The second was to serve on the Wales Commission on Co-operatives and Mutuals. The suggestion of the incoming Director of the Wales Co-operative Centre, Derek Walker, the Welsh Government took up and supported the work of the Commission as a way of developing and widening its business and economic policy. What emerged from the Commission were two practical programmes of work around co-operative social care and co-operative housing, both led by the Wales Co-operative Centre. The recommendations though were far more limited than Robin would have liked, tempered by the low ambition of the civil service supporting the initiative. One initiative, in particular, that he championed was a co-operative investment bank for Wales, modelled possibly on the development bank Caja Laboral in Spain. Although this was edited out of the action plan, the idea did re-emerge in the form of a commitment in 2018 by the new Wales First Minister, Mark Drakeford, to forming a public bank on co-operative lines.

In both initiatives, the emphasis for Robin was moving from an open landscape of broad-ranging opportunities and themes around co-operative innovation to a more in-depth, granular look at specific sectors. Co-operatives in the UK, he pointed out, are not, and never have been, spread evenly across the economy. They tend to cluster in various ways, and successful co-operatives are even more clustered. This was not just about economic sectors, to be fair, as it could be about geographies of connection too, but scale would only come from effective networks of co-operation between co-operatives, or where appropriate partnerships with the state - what Pat Conaty had called in the BALTA work ‘public social partnerships’:

 

“Co-operatives do not fly solo. That is a primary lesson from continental experience. It is not that isolated co-operatives cannot survive. There are many examples in Britain where they have done so. But they remain confined to particular niches and are constantly vulnerable. Radical co-operative development depends on creating networks and institutions that can mutually strengthen each other.”

 

Strategies for developing co-operative and mutual enterprise therefore need work at two levels:

  • the horizontal approach, where there are framework changes which can reduce the barriers to co-operative business development across sectors. These may include: legislation: understanding of the co-operative option among those who advise business; co-operative education and learning; access to finance; policy support and recognition. 

  • the vertical approach, specific to a sector, where there is opportunity to develop and test proven models and to build the capability, from the bottom up, to bootstrap advice and learning by building a community of practice and partnerships that can accelerate the spread of innovation in relation to defined needs.

In the social care sector, for example, he focused on service design and business modelling for an integrated approach to health and social care, testing his ideas with practitioners such as Liz Watson and Laurie Gregory. He was drawing in part on his time at the Design Council, in part on his acute sense of how to make mutuality work in business terms. Public services, he argued, are first and foremost ‘relational services’. Health, education, care, policing, and community services all pivot round the relations of the front line service provider and the user. There are four distinguishing features of such relational services:

  • the quality of the relationship between service provider and the user is part of the quality of the service. In these cases the service is not a given package to be delivered, but is in part determined by the relationship established between user and provider.

  • central to the relationship is the establishment of trust. The provider is commonly in a privileged position of information and skill (a doctor or teacher for example) and the user needs to feel that they are on their side not governed by other interests.

  • these are services which are being transformed by changes in the digital economy, that enable mutual help and advice both through the internet and visual connections, the posting of issues, the arrangement of appointments and so on.

  • these are areas where the formal and informal economies are often interwoven, not just with the user being in effect part of production, but also his or her family and friends or those in similar situations.

Social care co-operatives, he saw, could involve users, carers and care providers, each of whom contribute to the quality of the service. The advantage of co-operatives or indeed wider social enterprise was that their institutional form matches the relational quality of the service, as co-ops are not “mediated by the administrative structures of the state or the profit imperative of private providers.”

Drawing on this lesson, to think sector, Co-operatives UK then set out on a three-year programme that I led to research innovation trends and co-operative options across a range of sectors. Robin chaired a panel of national economic commentators, researchers and practitioners at a ‘Pop Up Think-Tank’, held in 2013 at the Royal Society of Arts in London, the very same venue that hosted the first Co-operative Congress in the nineteenth century – an event that led to the formation of the Co-operative Union, now Co-operatives UK. At Robin’s invitation, Professor Michael Best, of the University of Massachusetts Lowell and an internationally recognised authority on sector development, agreed to act as advisor over the course of the work.

 
Robin with Professor Michael Best at a pop-up think tank on co-operative innovation for Co-operatives UK at the RSA, London, 2013

Robin with Professor Michael Best at a pop-up think tank on co-operative innovation for Co-operatives UK at the RSA, London, 2013

 

The result was research on fifteen sectors and their co-operative possibilities, published in a book that I edited called Co-operative Advantage, published in 2015 by the worker co-op New Internationalist. The total economic value of the sectors that we looked at added up to 61% of overall GDP and account for 64% of total employment in the UK. For each sector, a panel of innovation experts chaired by Robin assessed a range of factors:

  • size of the sector;

  • growth prospects for the sector;

  • the co-operative ‘fit’;

  • barriers to co-operative entry;

  • international co-operative exemplars;

  • the current co-operative presence; and

  • the likely level of co-operative innovation.

Out of this research, we identified fifty potential innovations that appeared to dovetail with emerging trends in technology and markets. Examples included: the potential for guarantee co-operatives, pooling small business muscle and knowledge when it comes to access to bank finance; data co-ops, such as the Swiss Health Bank, for a consumer-owned business model around personal data; and freelancers unions, allowing people who are self-employed and entrepreneurial but at risk to come together around shared services.

It was in a different sector, though, that national attention focused on co-ops and for far less hopeful reasons. In 2014, the Co-operative Bank was forced to de-mutualize, seeking private capital in order to order to set its finances on a stable footing. Its troubles were compounded by the extraordinary story of its Chairman, a combative Methodist priest exposed for the use of ‘crystal meth’ drugs and inability to recall the state of the bank’s finances. The Co-operative Bank was rescued without state support, which marks it out from its peers such as HBOS, Lloyds TSB and Royal Bank of Scotland. As I argued at the time, the Co-operative Bank did not get into trouble because it was a co-operative, but because it was a bank. But, while the Co-operative Bank newly finance has recovered and indeed has re-emphasised the quality of its ethics as a distinguishing feature, at the time it raised a question mark over the entire co-operative sector and triggered a destructive chapter of conflict at the parent entity, The Co-op Group. The survival of The Co-op was itself in question at least until the bank was recapitalized and with a relatively new executive team in place, trust was low, tolerance was limited and debate flared up, with insiders, outsiders and politicians taking to the airwaves to express one view or another on who was to blame and who now should lead the business in terms of its overall governance. There was an independent view on what had gone wrong at the bank, in the form of a review commissioned by The Co-op, conducted by Sir Christopher Kelly. As I explained to the members congregated in Manchester in August 2014 for a Special General Meeting to decide on a new governance model for the future, the review could be summarized by the three words ‘no-one took responsibility’.

This chapter was a lifetime low for Britain’s oldest consumer co-operative, formed out of people taking responsibility for themselves and for each other, and the reputation hit was felt across every co-operative in the country. While it included a dose of self-harm, exposed by unprecedented market conditions in banking, it also echoed of the words of Professor Johnston Birchall that: “it is said that when a conventional investor-owned company fails, people ask why it failed. When a co-operative fails, people ask whether co-operatives can ever be made to work. This is still true, even after all the disasters that conventional companies have inflicted on the world’s citizens over the last few decades.”

National Co-operative Development Strategy

One of the casualties of this episode was the closure of a national support programme, the Co-operative Enterprise Hub, funded by The Co-op Group. This had provided valuable support for the formation and development of new co-operatives, as well as resources for professional specialists working in the field of co-operative development. In this context, and building on the experience of our work on co-operative innovation, the board of Co-operatives UK under the leadership of a new Chair, Nick Matthews agreed to explore the formation of a broader development strategy for the sector.

To ensure the National Co-operative Development Strategy had full and fair representation from different parts of the movement, a Strategic Reference Panel was assembled, which had the task of connecting with and listening to the movement over a two-year period through engagement sessions. In addition, over 550 co-operatives took part in a national census, confirming that while many wanted to expand their reach and service, the sector was fragmented and faced some significant barriers. The final strategy, released in July 2017, is an open call for action to shape a future powered by true co-operation. Called ‘Do It Ourselves’, the strategy is a roadmap for how the sector can grow itself, by better leveraging its capabilities and resources, seizing new opportunities and engaging with individuals, businesses and communities. It recognises that there is a jigsaw of support that sits behind successful co-operative development. As the title suggests, co-operatives are born out of self-help and self-responsibility, so growing the sector was seen to start with what we can do for ourselves as a sector, while working in an open way and in partnership with others, including supportive governments if we are fortunate enough to have them.

The strategy starts with a vision for how business in future will succeed: “one day most businesses will be run in a participative way, giving a say to those involved. The best of these will be the foundations for a different kind of economy, one in tune with our values. These will be co-operatives.” In this context, the ambition of the sector is set out to see more people earning a living through a co-operative, with a fivefold increase in the sector, so that by 2037, 10 percent of the UK economy is generated by inclusive businesses such as co-operatives and mutuals. Drawing on the earlier work on sectors, with their focus on co-operative innovation and ‘fit’, and alongside sectors of historic strength across co-ops and a new attempt to spread the replication of successful models of co-ops, starting with student housing, three focus sectors and opportunities are selected for emphasis. These are: 

  • Freelancer co-operatives, where people who are self-employed come together

  • Social care co-operatives, serving but also engaging people in need

  • Platform co-operatives, offering shared ownership in a digital context.

To help deliver on these, as well as wider co-operative development, a new national programme of business support was launched, this time with the backing of the resettled but investor-owned Co-operative Bank, as part of its commitment to values and ethics that the bank had consulted on with its customers. Called The Hive, and led by Co-operatives UK, the design of this drew on lessons from what had gone before, with more of an emphasis on digital resources and networked interactions rather than depend primarily on one to one generic business advice. By the end of 2020, The Hive will have supported around 1,200 co-ops and would-be co-operative groups.

Robin with Milly Gaskin, the elected chair of the worker co-operative Leading Lives, Ipswich, in London

Robin with Milly Gaskin, the elected chair of the worker co-operative Leading Lives, Ipswich, in London

At the same time, the strategy also recognised that not all sectors are conducive to mutual enterprise models. Where relationships are fleeting or transactional or the financial capital requirements are high, the answer may not be co-operation. In Italy, one benchmark country, Professor Carlo Borzaga comments that the competitive advantages of the co-operative model come to the fore in more employment-intensive sectors and where there are opportunities to connect small and medium sized enterprises through co-operation that adds value through scale. “Therefore,” he writes “the co-operative form proves to be particularly suited either in sectors where the work is the strategic factor or in those in which the cooperation among producers enables them to take advantage of economies of scale while at the same time maintaining a high degree of flexibility in the production process at the base of the value chain.”

Ambition for the co-operative sector, despite the crisis that had hit the movement in 2015, was the view from the UK’s social economy. That was soon matched by a political ambition, thanks to work by the small Co-operative Party, a political entity celebrating its centenary and aligned to the Labour Party. In the 2017 General Election, Labour stood on a radical manifesto that included a commitment to double the size of the UK co-operative sector. Once the election was over, the Co-operative Party started work to explore the policy agenda that would be needed to deliver on this, commissioning the New Economics Foundation to complete an independent report on policy for a co-operative economy. This report recognized that as member-owned enterprises, co-operatives cannot be state sponsored or state led. At the same time, the state has an important role in play in enabling the conditions for successful mutuality and co-operation in our economy. In law, regulation, institutional arrangement, tax and public spending, our political economy should be better disposed towards mutuality.

The UK is one of the only countries worldwide to have a practical and participative strategy for growing the co-operative sector. What the UK is doing is seen as a genuine mark of progress. The publication of a strategy is not a substitute for action. But done well, it can be a spur to action, as in the case of policy formation on the left and also practical development, as the strategy helped to bring new partners into the co-operative sector. One example is the innovation foundation NESTA, which has supported work around ‘platform co-ops’ – democratic digital enterprises in which the platform is co-owned by those who use it - and given shape to ideas such as ones from Stir to Action for partnership with Co-operatives UK to launch Unfound, the world’s first accelerator for platform co-ops. Professor Trebor Scholz, originator and leading commentator on the field, has commented that “Unfound is the first example worldwide of a practical and systematic programme of action at the national level. It is impressive and a real model for new co-operative development.”

The formation of Do It Ourselves as an Open Strategy was designed to leave space for co-operatives, new entrants and sector partners to come in with their ideas and actions like Unfound. We have also seen the Confederation of Co-operative Housing champion backing for new government funds for community housing in England. In Scotland, SAOS is partnering with the food and drink industry, as part of a long-term strategy to grow the farmer co-op sector. A new, virtual network, SolidFund using the participatory decision making software, Loomio, was formed to raise regular donations for the development of worker co-ops. The Co-op, restored to some of its commercial health with a slimmed down and highly successful focus on convenience food, alongside its longstanding service in funeralcare, has recruited hundreds of people to work as Member Pioneers in neighbourhoods, supporting community action and connecting in to the wider co-operative movement.

In a nutshell, this has been a story of co-operative innovation. Data reported to the members of Co-operatives UK in its annual Impact Report reinforces this impression of a more positive capability for innovation. Co-operatives UK has been able to raise £30 in match funding for co-operative innovation for every £1 gifted by members. The public perception of co-operatives as innovators has risen by 16 percentage points since 2010. Co-operatives are now rated as more innovative than companies. This work, led by a small team in Manchester at Co-operatives UK, its Board and its member co-ops across the UK. It was informed and inspired by Robin Murray, as we corresponded regularly and met periodically as it developed. It is work that has therefore outlived him - work in progress, but work that also demonstrates the hope of progress. The Financial Times in November 2018, as one example, concluded that “the co-operative model of business, defined as a company owned by its workers or its customers, was once largely associated with farmers, grocery stores and credit unions. Today in Britain, a new breed of enterprises are breathing life into the movement.”

We all need a story. It just turns out that the story we have been told for years – that markets should serve investors, that entrepreneurs and innovators are naturally competitive and self-interested loners and that economic life is best shaped around that bleak fact – is bunkum. The co-operative sector, as one of the UK’s and the world’s longest-running social movements, has always pointed to a different story, but the sector itself needed to reconnect with wider changes in the world of technology, culture and knowledge in order to understand its own relevance. This is work in progress. Despite the crying need for business models that fit what is needed for a sustainable, steady-state economy – serving human needs while respecting environmental limits – there are no guarantees of success. But the hope is there. The co-operative sector in the UK does now tell something of a different story - that if you want to do something new, you should do it together with others; you should be a co-operator. As Robin Murray concluded, the beauty of co-operatives is that they are a tool that can help us to understand the hidden structures and forces that are shaping the economy as we experience it, that “in doing so they allow us to think how things could be done differently.”

June 2020 

References

Author

Ed Mayo is Chief Executive of Pilotlight, a social enterprise that supports business and small charities through curated programmes of skills exchange. From 2009 – 2020, he was Secretary General of Co-operatives UK. He is the author of books that include Consumer Kids (Constable, 2009), Values: how to bring values to life in your business (Routledge, 2017) and A Short History of Co-operation and Mutuality (Co-operatives UK, 2018). He has contributed short stories (2017, 2019) to the Knock, Knock fiction series of ‘modern folk tales for troubled times’ (New Weather Institute). Ed is Vice-President of Co-operatives Europe. He has been awarded an honorary doctorate from London Metropolitan University for his contribution to ethical markets.