Innovation in the governance of large co-operative businesses: the alarming case of UK Co-operative group

Abstract

This paper begins by providing a short history of the Co-operative Group and the Bank, showing how its current governance structure has come about. Then it provides a summary of what has happened since its current troubles began in 2009, asking what has gone wrong and why. Then it asks who is to blame; is it a failure of management or of governance? It finds that governance has to take a large part of the blame, and so examines the recent innovations that have led to the current peculiar and unsatisfactory governance structure. It then looks forward to the redesign of governance that has been called for by Lord Myners, and explains the work of this author and his colleagues at Co-operatives UK in helping with this process. It provides a method for evaluating alternative governance structures using an analytical framework first proposed in Birchall’s study of the world’s largest co-operatives. (Birchall, 2014)