A sustainable co-op business model can replace the corporate capitalism that has “devastated parts of the planet”, says the head of sector body Cooperative Business NZ.
Craig Presland, chief executive of the apex organisation for New Zealand’s co-ops, stated that “corporate capitalism is committed to the relentless pursuit of growth, even if it ravages the planet and threatens human health”.
He added: “Fund managers at global financial institutions now own the majority of the public stock exchange in most western economies, including over 70% in the USA. These absent owners have no stake in the communities in which the companies operate. Furthermore, management-controlled equity is concentrated in the hands of a select few: the CEO and other senior executives.
“The world urgently needs forms of social re-organisation that prioritise caring for the environment and putting people at the centre of the economy. We need to build a new system: one that will balance economic growth with sustainability and human flourishing. Here co-operatives can, and will, thrive even further as the member-owned business model looks set to dominate.”
In an article for the Cooperative Business NZ website, he pointed to worrying signs around the world, for the environment and for living standards.
Species are going extinct at a rate 1,000 times faster than that of the natural rate over the previous 65 million years, he said, with 6 million hectares of primary forest lost every year since 2000.
He added: “In many western countries, including the UK, young people are, for the first time, set to earn less during their lifetime than their parents.
“In the UK, more than half of company equity is now overseas-owned, with only just over 12% owned by individuals. In many cases, overseas-based fund managers have gained control driven in their quest to drive investor returns.
“Even in the USA, 15% of the population now lives below the poverty line. For children under the age of 18, that number increases to 20%.”
Mr Presland’s comments echo concerns voiced by co-operators in the UK and US, where cities like Preston and Cleveland have been pioneering new local economic models in an attempt to build a co-operative commonwealth. Earlier this month, the UK’s Co-operative Councils Innovation Network held its annual meeting where members voiced their concerns over growing inequality and austerity, environmental problems and the rise of populism.
Similar worries were voiced at this month’s annual conference of the UK’s Co-op Party, which also called for the economy to be run on co-operative lines.
Mr Presland said there was a “new economy mission” taking root around the world which “becomes more achievable if the power to determine the direction and strategy of business is in the hands of those with a genuine interest in addressing today’s challenges and who live within the communities directly being affected”.
He wrote: “Ownership matters. Distributed ownership and governance, with the co-operative business model at the forefront, is now becoming more and more important to global economies. Profits distributed to members equitably each year while being retained locally. Investment back into local communities. Responsible manufacturing and production practices. Economic, environmental and social sustainability.”
Worker-owned co-ops are “growing rapidly across western economies including the USA and Canada”, he added. Although these are not as strong in New Zealand, the country has more than 200 supplier-owned and customer-owned co-ops, which equitably distribute returns to suppliers and customers.
Mr Presland said the long-term commitment of members made for a more sustainable model than short-term investor-owned organisations, adding: “Since the beginning of the global co-op movement in Rochdale … co-operatives have transcended wars, economic crises, different political regimes and natural disasters. In all these years they have demonstrated that, in the midst of many different circumstances, they always best serve people and their communities.
“Clearly, the current economic model will not solve the inequalities that it has created while governments alone cannot provide all the answers. So co-operatives remain a genuine and effective tool for achieving true sustainability.”