Co-operatives and the right to know

The Freedom of Information Act 2000 lets the public access recorded information held by public authorities.

It covers all documents, computer files, letters, emails and sound and video recordings unless an exemption applies to the particular document.

People also have a right to their own personal data, such as medical records and credit reference files, but that is under the Data Protection Act 1998. Both systems are policed by the Information Commissioner’s Office (ICO) which provides information about the law and can enforce it if necessary. As the ICO said in its 2015 Guide to Freedom of Information: “The main principle behind freedom of information legislation is that people have a right to know about the activities of public authorities, unless there is a good reason for them not to.”

The main exemptions that justify non-disclosure of information is held by or on behalf of a public authority are:

• Information available by other means e.g. as personal data
• Personal Information about someone else
• Information provided in confidence
• Prejudice to commercial interests
• Prejudice to effective conduct of public affairs.

Scotland has its own very similar law for Scotland-only public bodies.

For co-ops, the main question will be whether they might ever be classed as ‘public authorities’. At present, that would only be the case if they were listed as public authorities in the updated schedule to the Act or designated by the Minister. Neither is likely to apply. Public authorities include local councils, government departments or agencies, universities, UCAS, further education colleges, most NHS bodies, the Association of Chief Police Officers (ACPO) and the Financial Services Ombudsman Service. Businesses wholly owned by government bodies such as local councils are also public authorities.

If public services are subcontracted to a co-op by a public body, such as a local authority, then the co-op may hold information for the public authority. The information can be demanded from the public authority but there can be no legally enforceable request to the co-op.

An Independent Commission is currently reviewing the Freedom of Information Act. The Campaign for Freedom of Information (CFI) has expressed concern that the Commission’s remit may lead to recommendations that:

• impose charges for requests
• make it easier to refuse requests on cost grounds
• make it more difficult to obtain public authorities’ internal discussions, or excluding some from access altogether
• strengthen ministers’ powers to veto disclosures
• change the way the Act is enforced.

There is no suggestion that the definition of public authorities would be extended despite the shrinking of the state and the movement of many functions to other bodies by contracting out. That suggests that there is no likelihood of co-operatives being brought within the category. The commission is controversial and both the Labour and Liberal Democrat parties are opposed to it.

Since c0-operatives value transparency, it’s important for them to empower their members by disclosing as much information as possible

Some information about co-operatives is publicly available. All but the smallest registered co-operative societies must lodge an annual returns of the accounts and a report on the business with the FCA Mutuals Register. That information is publicly available from the Mutuals Register.

Co-operative members will usually get that information at the AGM but have they no right to extra information unless the society rules say so. If the society raises capital through debt securities listed on the stock market, additional information will be available from there under Stock Exchange rules.

Anyone can find that information from www.londonstockexchange.com by searching in the society name, such as Co-operative Group Limited. Most large societies in fact disclose the same information on their websites – for example, on the Co-operative Group’s corporate section of its website, the information released to the markets is available alongside the annual report and accounts and information on governance.

However, plcs with shares listed on the stock market are under much heavier legal obligations to disclose information than co-operative societies ever are.

There is always a balance to be struck between the need for transparency and the commercial sensitivity of information but since co-operatives value transparency, it’s important for them to empower their members by disclosing as much information as possible.