Addressing delegates at the third annual National Retail Consumer Conference at Eastwood Hall, near Nottingham, Ms Lidbetter said member vigilance was the Movement’s only safeguard against the sort of problems that have afflicted huge UK companies like HBOS or the Royal Bank of Scotland and acknowledged that, the bigger the organisation, the more difficult it becomes to achieve proper accountability and transparency.
The Lincolnshire CEO said her own society — which operates 190 outlets; has 160,000 members and employs 2,500 staff, making it the largest private employer in the region — had seen sales and profits rise by 17 and 20 per cent respectively in the past two years thanks to an emphasis on community involvement and maintaining a strong regional and local flavour. So far, trading results have been unaffected by the credit crunch, but she admitted: “The problems of companies like RBS have highlighted the weaknesses of the public company model. However co-ops share some of the weaknesses of PLCs and it’s not until things go wrong that people ask questions.
“Of course, people might ask why we should worry about such things. Co-ops are doing well right now, but this is exactly the time to be asking those searching questions — while we have the time to put in new safeguards and have time to consider our strategies and assess any weaknesses in our business model.
“But the natural human tendency is to do just the opposite. It’s not so long since jailed fraudster Bernard Madoff was being hailed as a financial genius.
“Members must be truly connected to the structure of their societies and it’s their responsibility to be vigilant. So Co-op democracy must take centre stage — it’s our only safeguard against catastrophic business failure and if we forget that, we deserve to end up like some of the businesses that have failed recently.”
Ms Lidbetter said that, at Lincolnshire Co-op, independent directors had been appointed to the Board to “challenge the status quo” but insisted societies did not need to sacrifice their co-operative values to achieve commercial success.
She commented: “A values driven business must be totally consistent and transparent and in this present climate, we can show co-operation is a truly more ethical and sustainable way to do business. We can make this our time for renaissance because people are looking for something to believe in and someone to trust.
“But if we’re serious about filling that void, we must be aware that a veneer will not do. We must be consistently guided by our ethics right throughout every organisation — top to bottom, with a strong lead from Boards and executives.”
Standing by her own and her society’s commitment to co-operative diversity and localism, Ms Lidbetter said that co-operation among co-operatives was a principle that had served the Movement well. And she dismissed the theory that a single national society was inevitable or even desirable in the current economic climate.
Setting out her preference for strong regional societies working in partnership with the Co-op Group she said: “Surely no one is suggesting the nation needs just one bank; one building society or just one political party. Our Movement needs to be as diverse, innovative and ubiquitous as we can make it and strong regional societies give a platform for the Movement to grow and flourish.
“I am not simply talking about food stores — we need strong regional housing co-ops, windfarm co-ops and healthcare co-ops. In fact, the only limit is our imagination. We need a good mix of strong co-ops to secure the future of our unique business model.”
Ms Lidbetter’s speech was warmly welcomed by session chairman Hollis Smallman, President of Scotmid Co-op, who also stressed the importance of strong regional independent societies and by Phone Co-op Chief Executive Vivian Woodell who said the Movement should encourage diversity and societies of all sizes and types.
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