Former Co-operative Group chair warns members about ‘control’

Former Co-operative Group chair Len Wardle has warned members to think about the governance reform of the organisation. Mr Wardle, who resigned his position last November following revelations...

Former Co-operative Group chair Len Wardle has warned members to think about the governance reform of the organisation.

Mr Wardle, who resigned his position last November following revelations about former Bank chair Paul Flowers, told regional board members ahead of a special conference over the weekend that members should have full control over the main board.

According to current proposals, the board will have three directors nominated from members, alongside independent non-executive directors, an independent chair and up to two executive directors. The proposals are still under discussion and are set to be officially announced next month before a special general meeting in September.

Mr Wardle said he believes there are “a number of weaknesses” in the proposals and that there is a “fundamental flaw in the plan for selecting board members” from the nominations committee.

He added: “I am concerned that the proposals as they stand will remove any effective member control from the Co-operative Group.

“If the numbers of elected members on the board are to be reduced, then it is imperative that the proposed members council has the power of appointment over INEDS.

“It is not acceptable for the board, advised by management, to retain control over nominations. That these would be presented for ratification to our millions of members on a take it or leave it basis is not co-operative. It may well satisfy the bare legal requirements to permit registration, but it does not provide for any meaningful democratic control of our society.

“The feature of ultimate member control is fundamental to co-operatives in our country and differentiates us from building societies, for example, where boards are very distant from their members.”

In the email to elected members, he said: “As a regional board member, you have a serious responsibility to ensure that our society remains true to its core purpose as a co-operative. Unless these governance proposals are changed to reflect the need for meaningful democratic member control, then I would urge you to reject them until they do.”

In a comment on the overall governance review, conducted by Lord Myners from January onwards, Mr Wardle added: “I was dismayed at the manner in which Lord Myners went about his task. What should have been a co-operative, inclusive process of renewal became rancorous, and ultimately divisive.

“We were assured by the current chair that the Myners proposals were not ‘stapled to the back’ of the resolution agreed at the SGM, but the latest governance reform plan bears much of the imprint of Lord Myners proposals.”

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