Is the sale of CIS immoral?

In January 2019 the Co-operative Insurance Society (CIS General Insurance) announced the £185 million sale of its underwriting business to Markerstudy and confirmed an agreement with Markerstudy to distribute motor and home insurance products. The long delay in gaining regulatory approval from the Financial Conduct Authority (FCA) and the Bank of England’s Prudential Regulation Authority (PRA) has been attributed to Brexit.

Unite has two main concerns

• 200 insurance workers are to be made redundant – indeed a later article in Insurance Post states that 500 jobs will go
• and Markerstudy’s statement that it will not engage with union representatives and that employees of Co-op Insurance will be better off without representation from Unite, due to its positive track record as an employer that invests in its people.

Unite national officer Rob MacGregor (left) asked how the Co-op can agree to sell its workforce to a ‘union-busting’ organisation

He asks: “Has Co-op Insurance forgotten its principles in the rush to make a quick buck? This insurance company has long traded on its ethics and yet is now driving a coach and horses through the values of the co-operative movement. There is only one word for this proposed sale: immoral”, ending:

“How can the Co-op agree to sell its workforce to an aggressive union-busting organisation with no regard to its founding ethos?”

 

 

 

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Richer Sounds: another employee-owned company

 

Richer Sounds is a home entertainment retailer, operating online and through a chain of 53 stores. The business was owned by Julian Richer, the founder and managing director who began buying and selling hi-fi separates at school when he was just 14, before going on to open his first shop on London Bridge Walk five years later in 1978.

In January 2011, Richer Sounds received a Royal Warrant and won 5 ‘Retailer of the Year’ or Best Retailer’ awards from Which? in 2010, 2011, 2015, 2018 and 2019. The company is an accredited holder of the Fair Tax Mark for transparency over tax disclosures and part of the Living Wage Scheme, set up by the Living Wage Foundation, and Julian Richer has backed their Living Hours program, which seeks to curb zero-hour contracts.

In 2018 Richer (right) set up the think tank Taxwatch to investigate and expose aggressive tax avoidance, which, he believes, denies the public purse at least £50 billion a year: “If you think that the entire prison service, which is bursting at the seams, costs only £3 billion a year to run, can you imagine how much good could be done if we collected that money?”

The Church Times reports that, like his Taxwatch colleague, James Timpson, he decided that he would buy a holiday home for the use of his staff (whom he prefers to call “colleagues”). Today, the company has a dozen homes, including apartments in Amsterdam, Paris, Barcelona, and Venice. “Every year, more than 70% of our staff use at least one of them for a free holiday.”

In November 2013, Julian Richer announced to the press that, upon his death, he would bequeath 100% of the firm to a trust co-owned by employees of the company.

In May 2019, then aged 60, he transferred ownership to employees by passing 60% of his shares to an employee ownership trust as well as separately paying each employee, excluding directors, a bonus of £1,000 for every year of work from his own pocket to his 500+ employees who had worked an average of 8 years each (circa £4 million). Richer Sounds is now controlled and majority owned by the people who work within the company. News of their performance follows:

Yesterday Tech Digest reported that Richer Sounds was rated top tech retailer in Which? Survey. At the top of its table, the employee-owned company almost had several five-star ratings, with customers praising the retailer for its value for money, customer service and product warranty.

 

 

 

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Workers’ co-op challenges BP’s claim of helping the world to get to a net zero future

See the Bloomberg interview here.

BP held a three-day virtual investor event in September to unveil its plans to shift away from oil and gas. Its CEO, Bernard Looney (above), said

“. . . the energy mix is changing – oil and gas are going to be increasingly challenged – and other forms of energy are going to see incredible growth. That is a likely outcome in each of the scenarios informing our strategy – and is reinforced by the pandemic.

“And therein lies huge opportunity for our company. Rewiring and replumbing the global energy system for a net zero future is going to require trillions of dollars of investment. For a company like bp – with our reach, our relationships and our capabilities – reimagining energy is an opportunity to create value – strengthen our resilience – and help the world get to net zero”.

Culture Unstained is a not-for-profit workers’ co-operative founded in October 2016, a member of the Art Not Oil coalition and part of the growing international movement for #FossilFreeCulture.

Through research, engagement and campaigning it aims to end the fossil fuel sponsorship of culture

Chris Garrard, its co-director has written to the Financial Times, refuting its suggestion that BP’s “net zero” ambition is broadly in line with reaching Paris climate goals of limiting global warming to 1.5C.

He points out that, while BP will not undertake exploration in new regions beyond 2030, it will persist with new exploration around existing finds despite proven fossil fuel reserves already being enough to take the world well beyond 1.5C, insisting:

“Fossil fuel production must be all but phased out by 2050 to meet emissions reduction targets, but BP still plans to be extracting fossil fuels by that date, relying on unproven technologies to address the emissions that would be produced”.In their latest post, earlier this month, Culture Unstained reports in detail, supported by snapshots of documents. that emails and meeting notes, released to them following Freedom of Information requests, reveal attempts by BP, Shell and Equinor to sponsor COP26 climate summit, influence its agenda behind the scenes and ‘partner’ closely with the UK government around the summit.                                                                                  Chris Garrard agrees that a shift in BP’s outlook is encouraging, but stresses that until the company’s strategy fully reflects what a 1.5C target demands, it continues to be more closely aligned with climate breakdown than the Paris goals.

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Edgar Parnell: Enterprises that Change Lives

Edgar Parnell’s latest book will be of interest to any serious student of the co-operative and mutual movement.

In it, Edgar (left) sets out to provide all those involved in all kinds of self-help enterprise (SHEs) with clear guidance on how to run successful enterprises that achieve their purposes and serve their members.

There are two versions of Enterprises that Change Lives, in a range of formats. The UK English version is available at a site which offers the chance to read several pages of the book. A  US English version is available here.

Millions of people worldwide are members of mutually-owned enterprises that can positively change their lives. Together, they control their self-help enterprises (SHEs), such as cooperatives, credit unions, savings & loan associations, mutual insurers, building societies, friendly societies, community enterprises, and many other types.

This distinctive form of enterprise help members to get a better deal by intervening in the market in their best interest, while providing an organization that exists to serve them, helping them, their families and communities to build a better future.

SHEs work for people with widely differing needs; for example, marketing produce, supplying farming inputs, getting healthy food at fair prices, accessing financial services such as credit and savings, insurance and mortgages, providing decent housing, health, and care services, maintaining shops, pubs, and transport in their local area, or by managing their workplaces.

This book specifies the model of enterprise required, sets out the systems and the culture needed to ensure that they are fully effective, but does not advocate doctrinaire approaches; it provides essential concepts and tools that transform how to organize and manage SHEs.

The intention is to help leaders think-through the issues involved so that they can make better decisions, for, without the proper organization and systems, it’s highly unlikely that even the most enthusiastic leader will make a success of their enterprise.

The model specified takes account of centuries of international know-how and encapsulates the ‘foundation practices’ that sustain this form of enterprise. It is designed to ensure self-help enterprises focus on achieving their real purpose and work in the best interest of their members. The book also explains why individuals, communities and nations need SHEs if they are to prosper and what policy-makers, community-developers, and academics can do to help grow and sustain them.

 

 

 

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Moneyfacts’ Co-operative Bank award

The Save our Bank co-operative draws attention to the Co-operative Bank’s  Moneyfacts’ Branch Network of the Year Award 2020, received for the third year running and – for the first time  – the Best Current Account Provider award.

Moneyfacts.co.uk is entirely independent and authorised by the Financial Conduct Authority. It compares deals for savings & ISA accounts, current accounts, mortgages, credit cards, loans, insurance products and much more.

Lee Tillcock, Editor of Moneyfacts said: “In terms of rationale, the results reflect products provided to the sector during the judging period in 2019-20 and based on the data displayed in Moneyfacts magazine or on any of the Moneyfacts online systems”.

The Best Current Account category was closely fought

By continuing to provide support via a straightforward and reasonable agreed overdraft rate and a leading rewards bonus, the Co-operative Bank is the deserved winner of the Best Current Account Provider category at the 2020 Moneyfacts Awards.

A clear pricing structure resulted in a competitive overall deal for consumers and sees the Co-operative Bank recognised as the leading current account provider at the Moneyfacts Awards for the first time.

The writer, who holds current and savings accounts with the bank, adds a special commendation for the relatively simple telephone advice procedure and the helpful and efficient customer service staff located in Liverpool.

The Co-operative Bank plc provides a full range of banking products and services to retail and SME customers. It is the only high street bank with a customer-led ethical policy which gives customers a say in how their money is used, launched in 1992.

The policy has been updated on five occasions, with new commitments added in January 2015 to cover how the bank operates its business, products and services, workplace and culture, relationships with suppliers and other stakeholders and campaigning.

 

 

 

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Scotland The Bread: building a home-grown grain economy

Co-operative & Community Finance gave a loan to Scotland the Bread, via the Just Growth Fund, which focuses on supporting businesses connected with community food and farming work. Scotland The Bread, a Community Benefit Society, ensures that their work to improve the country’s staple food is focussed on people not profit.

Scotland produces far more wheat than is needed to make all the bread eaten in the country, but little, if any, is used by local bread makers. What isn’t fed to animals, distilleries or cars (as ‘biofuels’) is bought by large milling conglomerates for industrial bread production to supplement imported wheat.

A government statistics report says that Scottish wheat is mainly soft wheats that are used mostly for malting and it imports hard wheats for milling, generally used for bread-making, because the country’s climate does not suit hard wheat varieties.

Scotland The Bread is supporting six groups to grow their own healthy bread, from the soil to the slice. The plan is to provide seed from three Scottish heritage wheat varieties that look promising and help each group through a year of growing, milling and baking. Small-scale portable equipment to sow, thresh, clean and mill the home-grown grains will be provided.

In order to produce more nutritious wheats, suitable for low-impact farming, a group of interested people from all parts of the food system, from plant breeders to public health nutritionists has been convened.

A joined-up carbon reduction strategy

Agriculture and food processing account for 18-20% of UK annual greenhouse gas emissions, so it makes sense to reduce the distance wheat travels – across the seas or just between field and plate – to limit the use of fossil fuel-dependent inputs and to reduce the energy intensity of processing.

Local bakeries, rooted in their communities, can supply fresh, properly fermented bread to nearby customers, conserving nutritional value without recourse to the synthetic additives that are deemed essential for long-distance loaves.

Better grain and better bread could help to solve Scotland’s growing health problems

The soaring cost – both personal and financial – of diet-related ill health in Scotland makes creative action urgent.

To build health and food sovereignty requires better grains, less intensive processing and more connection between producers and bread eaters. Research to find more nutritious wheats, suitable for low-impact farming, is under way.

‘Fair trade’ arrangements are needed between farmers, millers and bakers to ensure equitable rewards and honest prices that also allow for the variability of the weather which affects grain quality.

Growing more bread wheat in Scotland would contribute to food sovereignty in an unpredictable global marketplace and, depending on how it is done, could bring meaningful jobs back to the country. 

 

 

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Co-op stores to create 5,000 new jobs in a bid to help those who’ve lost jobs in bars, pubs and restaurants

Neil Hodgson reports today that the Co-op, has announced plans to create 5,000 store-based roles in a bid to provide temporary employment for hospitality workers who have lost their jobs.

Jo Whitfield, Co-op Food chief executive, said: “Whilst our store and depot colleagues are working around the clock to ensure people have the essentials they need, we are all too aware that many people working in bars, pubs and restaurants are currently out of work. It makes perfect sense for us to try and temporarily absorb part of this highly-skilled and talented workforce who are so adept at delivering great customer service, as we work together to feed the nation.

Recruitment procedures have been simplified so that candidates can apply for positions by walking into their nearest Co-op with a view to starting work in a matter of days.

Co-op colleagues in business support roles who are not currently working in stores or distribution centres are also being encouraged to ‘lend-a-hand’ in their local Co-op to help replenish shelves.

The boost in colleague numbers will help stores to replenish stock more efficiently, fulfil online orders and provide ongoing assistance to more vulnerable customers.

 

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Source: Business Desk North West

 

 

 

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Co-operative Bank signs agreement with the Customer Union for Ethical Banking

The Co-operative Bank has signed a formal recognition agreement with The Customer Union for Ethical Banking, an independent organisation representing thousands of Co-operative Bank customers concerned about the UK’s social and environmental issues (see coverage in The Guardian here).

The Customer Union for Ethical Banking, a member-owned co-operative, was established in 2016 following a successful crowd-funding campaign. It has 10,000 members and supporters who are customers of the Co-operative Bank. It exists to represent customers who are keen to ensure the Bank maintains and extends its unique customer-led Ethical Policy. As a united voice, members can join together to press for the kind of policies and products they want the Bank to consider. The Union and the Bank have been engaging informally for several years and have built a good working relationship.

Not only has the bank got a courteous and efficient customer advocate team (including Justine and Joe) but its Ethical Policy has included a commitment not to bank any business whose core activity contributes to global climate change via fossil fuel extraction or production since 1988. In 2015 it was the only UK bank to sign the Paris Pledge to end financing for the coal industry and in September 2019 the Bank gave colleagues time off to support the Global Climate Strike.

Lesley McPherson Director of Communications Co-operative Bank and Shaun Fensom Customer Union for Ethical Banking, sign the agreement

Earlier this year, the bank agreed to reinstate a special external audit of its values and ethics report after the union raised concerns. That audit – which took place every year since 1998 – is meant to independently assess whether the Coop Bank is actually implementing its policies.

Co-op Bank’s chief executive, Andrew Bester, said: “It’s fantastic that we have a group of loyal customers as committed to our ethical brand as we are – and our regular conversations with the customer union are positive and very valuable in terms of understanding what matters to them.”

 

 

 

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Landmines video: bank policy

The Customer Union for Ethical Banking, an independent organisation represents thousands of Co-operative Bank customers concerned about the UK’s social and environmental issues

Its new video presents a 1997 cinema ad from the bank about the impacts of landmines, intended to raise awareness of the bank’s policy (still going strong 23 years later) not to do business with oppressive regimes or companies that sell them weapons.

A Facebook post of the video may be shared or their tweet may be retweeted. The video, which can be found on its website, can be downloaded and shared on other platforms.

 

 

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In an increasingly unstable world, Marinaleda, an Andalusian village, has developed a co-operative alternative

Following the death of General Franco the Union of Farm Workers was founded in Marinaleda and in the first local elections the Workers Unity Collective won nine of the 11 council seats. In 1979, Juan Manuel Sanchez Gordillo, who says he is a communist and communitarian, but has never been a member of the Spanish Communist Party, was elected mayor. He started campaigning for land reforms to benefit Marinaleda’s unemployed and landless labourers, more than 60% of Marinaleda’s inhabitants.

700 people were involved in a 13-day hunger strike against local landowners in 1980 under the slogan “land for those who work on it.” The Cordobilla marsh was occupied in 1984 to demand the irrigation of the El Humoso farm owned by the Duke of Infantado who left the land uncultivated for most of the year while so many were living in poverty. Eventually local activists took over the farm and by 1985 there were at least 100 local land occupations.

In 1991, the regional government awarded the farm and its 1,200 hectares of land to the village. Sean Meleady reports that the village’s agricultural cooperative, established soon afterwards, aimed to grow crops that required the greatest amount of labour, such as olives, green beans, red peppers, paprika and artichokes, in order to create as many jobs as possible. A few years later, Marinaleda built its first processing factory, to can and jar the cooperative’s produce.

Every member of the co-operative earns the same daily salary of €47 (£39.40) for six-and-a-half hours’ work – more than double the Spanish minimum wage. Decisions about the co-operative including, for example, which crops to farm, are made collectively in village general assemblies.

Right: a co-operative worker harvesting olives

For the past 24 years, the farm and the factory have provided employment to Marinaleda’s inhabitants, while all of the cooperative’s profits are invested in the creation of new jobs.

The village’s mayor and members of the local council work voluntarily at the cooperative but have other jobs. For many years, the mayor worked as a history teacher at the local high school.

The village has an amphitheatre, workers’ sports ground, house of culture, vegetable canning factory, a library, a botanical garden and the “Sindactio” trade union bar. Hagar Jobse counted 20 companies in the village: seven privately owned bars, three cafes, two pharmacies and a bridal shop. Although large franchises are not allowed to establish branches in the village, the mayor says he doesn’t want to stand in the way of entrepreneurship – “as long as their businesses do not become too large”. Multinationals are not welcome.

     Mayor Sanchez Gordillo lives in one of Marinaleda’s government-owned houses

The government provides or pays for building materials so that members of the cooperative can build their own house. Prospective residents have to donate 450 days of their own work to the construction of their new homes, getting assistance from professional builders. The hours spent by the resident on construction are then deducted from the total cost of their house — with a monthly payment of €15.52 (£13.20) to achieve ownership. More than 350 homes have been built in this co-operative fashion in a village of less than 3,000 people. Homes have three bedrooms and a patio. However in order to preserve the special character of the project residents cannot sell their homes.

Hagar Jobse reported that Marinaleda has very little crime and few police officers and a later account says there is no police presence and that misdemeanours are resolved by villagers. On ‘Red Sundays’ villagers gather at 8am outside the Sindactio in order to undertake voluntary work., including street repairs, painting and landscaping.

Life in the village is cheaper than in the rest of the region. For 15 euros a month, inhabitants can pay off their mortgage, become members of the sports centre, or have a kindergarten place for their child. The local government provides three free school meals a day and even the small number of unemployed inhabitants are able to make ends meet with the 400 euro jobseeker’s allowance provided by the Andalusian government.

Though the village has its critics, the testimonial of Vicky Shovelton, born and bred in Sheffield, who has lived in Marinaleda for years carries conviction. She has written an account of the village, ending: “The community spirit of my childhood is alive and well here in Marinaleda. This unique village is filled with a sense of togetherness often lacking in today’s society. The concept of how this village has survived through past times and how the vision of the ideal community that it has become, is certainly popular throughout the world. It has created a place that in some respects is an ideal place to be.”

 

 

 

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