Sweden’s apex body for co-ops has published a governance code for co-op and mutual enterprises.
Adoption of the code is voluntary but once adopted, it becomes binding. It provides guidelines for the governance of co-operative and mutual enterprises based on ethical values and principles.
The code aims to promote member dialogue and democratic decision-making in modern co-operative and mutual enterprises, and to increase transparency and openness at board level.
The code is based on the principle of comply and explain, which means those adopting it must explain how they comply with its principles and report on their implementation. It is particularly aimed at large co-ops and mutuals. However, according to Co-op Sweden, smaller co-ops should also be able to comply with some parts of the code.
Tommy Ohlström, chair of Co-operatives Sweden, says the code helps to explain the specificity of the co-operative enterprise model, which places members at the heart of the business.
“We’re proud that we’re now increasing transparency even further and making it even clearer to our members and the world around us how co-operative and mutual enterprises actually function. The new code is a consolidating document that explains and clarifies the special features and business logic of co-operative and mutual enterprises,” said Mr Ohlström.
The code is based on the following principles:
- business objectives benefit members and follow their wishes
- open, transparent and democratic
- members participate in the business
- general meetings where members can exercise rights and be informed
- election committee to ensure transparency and safeguard interests of enterprise and members
- competent, independent board of directors to establish framework and processes for risk management and internal control
- guidelines for remuneration, terms and conditions for senior executives
- framework and processes for risk management and internal control
“This form of enterprise is now being framed even more clearly through the newly established code, which is designed to ensure transparency,” said Mr Ohlström, adding that he hoped the code would contribute to global efforts to raise awareness about the model.
With a turnover of more than SEK 400bn (£34.08bn) and 100,000 employees, the 100 largest co-operative and mutual enterprises account for a significant share of the labour market and social economy in Sweden.