New dawn for Co-op Group?
The Co-operative Group could be moving into a new era amid a period of major changes.
The Co-operative Group has had a difficult couple of years, with sizeable losses and gaps in its finances alongside some major scandals. But this month could well see the start of a new era for the company – by focusing in on the abiding principles on which it was founded.
Yesterday, 1 October, saw the Financial Conduct Authority (FCA) register rules that will represent a massive revamp of the group’s governance structure that was voted through by shareholders in August.
The whole of the board has been cleared out and the 18-strong group of directors will be reduced to just 11. Eight will be independent, while three will be nominated directly by members.
Seven of the existing directors will remain in place in the interim until their replacements are appointed, while a council of 100 members will now be given the power to hold the board to account. A senate will then be elected to oversee relations between management and members.
Moves to strengthen the approach to sound corporate governance will help to allay the concerns of investors and customers alike about how the group is run. But for many consumers, the Co-op is ultimately about ethical business, and that’s exactly what a new marketing campaign is seeking to convey.
The Co-op Bank, which has probably been hit the hardest by the group’s recent turmoil and is now just 20 per cent owned by the Co-op after waves of share sales to raise funds.
Yet its latest ad is clearly intended to demonstrate the bank’s closeness to those founding principles of the co-operative movement.
Some £5.5 million has been spent on the campaign, which begins tonight with a TV advert in which a man has the words “Ethics & Values” tattooed on his back after being inspired by the organisation.
It may take time to win back the trust of some consumers, but the Co-op Group and its banking arm are working hard to remind the public why it was so fond of the Co-op in the first place. The fifth update to its ethical policy is due later in the year, based on the results of a poll of customers and employees. It’s likely that this is intended to mark the dawn of a new age.
<Image credit: The Co-operative>