The media has really gone to town this week on The Co-op’s spectacular fall from grace. In the year it celebrates its 150th anniversary, the out-of-hours antics of its former bank chairman Paul Flowers has brought the entire movement into disrepute. It’s been awful to watch.
But while Flowers himself deserves all the opprobrium he gets, the coverage has also been unfair in many regards. In its definition of the co-operative movement, the BBC only mentions the Co-op Group, the Co-op Bank and the Co-op Party - completely missing out the sterling performance of employee-owned mutuals like the John Lewis Partnership, or Ocean Spray, or Arla - or the rest of the CRTG, which have been unfairly caught up in the Co-op Group’s dirty linen.
“The Co-operative Movement has been unfairly caught up in the Co-op Group’s dirty linen”
Adam Leyland, Editor
The co-op movement is worth £36.7bn in the UK. The Co-op Group accounts for barely a third of this.
Criticism of Ursula Lidbetter, and her appointment as the group’s new chairman, is also unfair. As Lincolnshire Co-op’s CEO (and first female CEO in the Movement), she’s done nothing wrong. Running a co-op that’s the same size as publicly traded Majestic Wines, food sales are up 5.1% and unlike the group, her co-op paid out a divi (of £1.8m) this year, so she’s doing a lot right. More importantly, in her ‘root and branch’ review of the Co-op Group’s corporate governance she initiated this week upon her appointment, she may well conclude that in future the chairman should be from outside the movement. Give her a chance!
Nor is the government particularly qualified to criticise the qualifications of Co-op executives. Gordon Brown’s only previous experience outside politics was as a university lecturer. Our current prime minister worked in PR. And incidentally, former Asda executive Andy Hornby had hardly any experience in banking before he was appointed to run HBOS.
That’s not to say The Co-op Group doesn’t deserve criticism. One reader wrote to me last week wondering why The Grocer was running “such a continued stream of negative articles surrounding the Co-op, particularly the Co-op Bank, since the last time I checked banks did not sell grocery.”
He also questioned why we hadn’t included a visit to the Co-op Group head office by the Queen. “Appreciate bad news sells,” he wrote, “but surely this warranted a few columns.”
With the suspension of the divi resulting directly from problems created by the bank, and the fact Euan Sutherland has been utterly preoccupied with the bank since his arrival, we can hardly ignore these calamitous events, but we report them and comment on them with a heavy heart.
