How was 2020 for the co-op sector in new Zealand?
This year has certainly thrown up some challenges, but our co-operatives have taken the disruption in their stride.
Aotearoa New Zealand is one of the most co-operative countries in the world with co-operatives generating approximately 19% of GDP. Our members come from a wide range of industries so there were few not impacted by Covid-19 in some way.
Many co-operatives were classed as providers of essential services, which meant they were able to continue to operate in at least some capacity during the nationwide lockdowns.
We have been fortunate to have had a successful pandemic response that resulted in relatively low infection rates however closing the borders has been devastating for industries such as tourism and hospitality.
Co-operatives have shown remarkable resilience by being quick to adapt and in some cases, they have come through stronger. A number of our members have experienced a surge in demand, such as food and home improvement retailers.
Right now life in New Zealand is relatively normal with few restrictions in place but we can’t be sure what the longer term impacts on the economy will be.
What was the sector’s role in supporting members and communities through the pandemic?
This year especially we saw the principle around ‘Concern for community’ highlighted with co-operatives going the extra mile to support their members, their communities and those in need.
Last month we held our Annual Awards, where we heard about the great initiatives co-operatives implemented. As an example, supermarket operator the Foodstuffs Co-operatives, the winner of the Co-operative Business of the Year Award, put in place initiatives including an additional 10% allowance throughout lockdown. They also established a fund to distribute more than $1.3m to 55 social organisations to help New Zealanders facing tough times.
Other highlights included health insurer Southern Cross Healthcare crediting the cost of premiums for its members and business customers to a total of $50m.
Co-operatives in the financial services sector provided special rates and offers to members, while others employed staff from other industries who lost their jobs.
The government’s message around ‘being kind’ was truly emulated within the co-operative community, with our members focused on looking after the health and wellbeing of their employees.
This is only a small snapshot, but it has been heartening to hear about all the great things out co-operatives have been doing to support New Zealand and New Zealanders.
What other challenges did / do co-ops face?
There are still challenges on many fronts.
Our major exporting co-operatives such as Fonterra, Zespri, Alliance, Silver Fern Farms and Dairy Goat Co-operative, are reliant on consistent access to the export markets. The ongoing disruption to supply chains and access to some markets continues to be problematic and there are backlogs on imports as well.
The border closures have severely impacted the tourism and hospitality sectors, which has had flow-on effects to organisations that supply those industries.
Access to both essential and seasonal workers while the borders remain shut is an issue, particularly for horticultural co-operatives who are reliant on seasonal workers for harvesting crops over the peak season. There are ongoing discussions with Government and local communities to find solutions.
How did New Zealand co-ops innovate in 2020?
Across the board, organisations have adapted to new ways of working and doing business.
They’ve accelerated the use of technology and remote working. More is being sold online and where working from home wasn’t possible, solutions were implemented to keep employees safe. More businesses here are considering collaborating on block chain solutions, where they share data and insights to minimise rework and effort.
We are starting to see a lot more interest from start-up’s sitting across a range of sectors, such as media and waste, looking to apply the co-operative business model. People are increasingly recognising that co-operatives are a great way to do business. This is the one bright side of Covid, so that’s been encouraging to see.
With our members, we are continuing to see an increased commitment to supporting the delivery of the UN Sustainability Development Goals. They are particularly focused on reducing their carbon emissions and many have initiated ESG reporting of progress.
What changes would you like to see in 2021?
While signs are encouraging, Cooperative Business New Zealand would like to see greater recognition of the value of the co-operative model and more businesses opting to structure themselves as co-operatives. Many of New Zealand’s most successful and enduring businesses are co-operatives, yet this fact is relatively unknown with many perceived as corporates or franchises.
At Cooperative Business New Zealand we are focused on the development and inclusion of education on the model working with the multitude of education providers to better support the sector.
Co-operatives are fundamentally important to any thriving economy. They create jobs and enable the establishment of sustainable businesses that can be handed down to multiple generations. New generations are looking to move away from the capitalistic model that places profit ahead of all else. I believe it is the co-operatives turn to shine.
What challenges and opportunities could 2021 bring to your sector?
I foresee more SMEs moving to apply the co-operative model to enable their survival through collaboration, along with innovative start-ups.
However, to enable this, there is always the challenge for these businesses to access capital. With a big innovation push, we will be actively encouraging the government, banks and private equity firms to support the establishment of these businesses.