The co-founder of Cook may have gone from Tesco basher to Tesco lover but he's not so sure about a business model focused obsessively on shareholder returns As someone who co-owns a fiercely independent food company based on principles pretty much diametrically opposed to those of a supermarket, people often think I would be on the "slagging off Tesco" bandwagon. I used to be. But I have changed my mind. Here's why. The purpose of Tesco is to deliver financial returns for its owners (shareholders). That is its only raison d'être. And it is truly excellent at doing that. Many of the things that have driven the success of Tesco are profoundly impressive. It is an organisation that pulsates with creativity and intelligence, exemplifies clarity and single-minded purpose and oozes effectiveness. A vast number of talented people achieving extraordinary things together. An awesome lesson in the art of the possible. So why the bitching? I have come to believe the criticism is being levelled by Luddites who do not understand they are Luddites. These are people (and it takes one to know one) who have not understood that our society has adopted certain systems or ideologies, one of which is wealth creation through free market capitalism. In this system, shareholder return is the objective of all publicly owned businesses. It is naïve to believe they are there for any other purpose - such as being good neighbours or being nice to suppliers. They may well do these things, but as a means to maximise shareholder value. To do otherwise would be to act unprofessionally within their mandate as management executing the will of the owners. So why the victimisation? I would suggest three main reasons. The first is there are genuine problematic outworkings of the business model of supermarkets as there are with all big businesses run for financial return for a disconnected group of shareholders. "Giving the customer what they want" can lead managers into doing things that they may not wish to boast about. And when the true culprits are customers on the one hand and shareholders on the other, management are put in a tough spot. Scale opens a whole new set of dilemmas, the solutions to which are not always edifying. And often the less edifying, the more profitable. All this in a business where shareholders are too disconnected to participate in the management dilemmas presented at the interface between profit generation and ethics. The second reason for the victimisation is simply that Tesco is the leader, the highest-profile exemplar of the supermarket industry .This is enough for it to be victimised. The third reason is that it represents to us a temptation we all fall for - lower prices, more convenience, soothing words. We all know underneath that someone, somewhere, is paying and that makes us feel bad. But rather than blame ourselves it is more convenient to turn our ire towards the tempter. My message to my fellow Luddites is this. Don't criticise Tesco for being brilliant at delivering what its owners ask. Instead, how about joining those of us who are trying to find constructive solutions to the downsides? There is an awakening under way. People everywhere are starting to explore other ways to do business. Under the partnership model of ownership, Waitrose is just one business that is proving every day that there is "another way" and it is better. Ditto the Co-op. We at Cook are just starting out on our journey and don't have the answers yet. But we'll have fun on the way trying to find them.n

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