Group National AGM - Part 1

As a first time attendee at the national Co-op Group AGM, I was interested in how it would be different from the only other business AGM I have been to (that of West Bromwich Albion Football Club Ltd.). The fact that the first item after the opening of the meeting was a minutes silence to mark the death of Co-operators since the last general meeting was certainly one difference between the two.

After the first two pieces of formal business (confirming the minutes of the previous AGM and the recent SGM), we were treated to a five minute video presentation entitled "Reasons to be Proud". I always find that corporate videos of this sort tread a fine line between meaningfulness and farce – and this was no different. The image of a cardboard box containing "The Co-operative beef and egg pasta lasagne" receding and fading into the distance to the tune of M People's "Search for the Hero" is one that will stay with me for a while. One interesting statistic to come out of the video was that we have gained 130,000 new members so far this year.

The Chair’s Statement consisted of a review of 2006, together with a tribute to our outgoing Chief Executive, Martin Beaumont, and a look ahead to the likely merger with United, which will create a larger retailer than Marks and Spencer.

Martin Beaumont’s review of the year became rather more of a review of his Co-op Group career. He pointed out the progress that had been made in terms of membership strategy, profit generation, group-wide marketing, and "synergy" (yuck – I hate that word!) between CIS, the Bank and each of the trading sections.

Following this, the finanical statements and remuneration report were formally received by the delegates, and distributions to corporate members – i.e. independent Co-ops - (£15.1m), individual members (£14.9m), our employees (£6.3m) and the wider community (£2m) were approved.

The motion to reappoint KPMG as our auditors was passed with a few dissenters – presumably these delegates thought that it was time the mantle of auditing was passed to someone else in order to maintain true independence.

We then had the question and answer session with the board – these questions had to be provided in advance of the meeting, and there were fourteen in total. I won’t go through each in turn, but here are a few that I found particularly interesting. Some of the questions, and all of the answers are paraphrased, and lapses in memory might mean that some are inaccurate. I apologise if this is the case.

Q: "Could the board clarify Shoefayre’s policy with regard to ethical sourcing?"
A: "Shoefayre understand the importance of ethical sourcing. SF customers do demand value in their purchases, and we do source mainly from Asia. We are in the process of implementing the ETI base code – which is rare in the footware industry"
My comment: The ETI base code is aimed at curbing the worst excesses of suppliers, and is not by any means a recipe for a worldwide trading system based on fairness and respect. However, our move towards this standard is to be welcomed as a good first step.

Q: "In the event of divestment, do we give employees assistance to set up worker or community co-operatives, or employee buy-outs?
A: "We do explore Co-operative possibilities as and when we remove ourselves from business sectors. We sold many of our department stores to Angia Regional Co-operative Society, and our milk business to the Dairy Farmers of Great Britain co-operative. However, when we sell up with respect to a small individual shop, it is because it is consistently losing a lot of money – and so is probably not the best option for a worker Co-op. Nonetheless, help is given where required, and if small food co-ops result, they can apply for corporate membership of the Co-operative Group."

Q: "The impending merger will result in a very large society. Demutualised building societies had largely lost the principle of active membership. What steps are in place in order to ensure that we do not share their fate?
A: "We wish to have a growing and vibrant membership, as both a defence against demutualisation and as a prerequisite in our aim to be "the world’s best Co-operative". The recent past has seen the biggest membership drive in our history, with two million people receiving information on how to be an engaged member. Since the relaunch, the number of people on the active member’s network has doubled to 250,000. Other steps against demutualisation include strong clauses in the rule book, and the commitment that members must make to keeping the co-operative nature of the Society. If members are proven to be acting in defiance of that commitment, they can be expelled.

Q: What measures does the Co-operative Group have in place to ensure that the five basic animal welfare freedoms are protected by our suppliers?
A: All Co-op labelled meat products are accredited to a national farm assurance scheme, which includes the five freedoms.

The rest of the meeting will follow soon… See Part Two here

P.S. Pictured is detail from the Co-operative Wholesale Society building on Corporation Street - right next to New Century Hall where the AGM was held. The motto around the wheatsheaf reads "Labour and Wait"