CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD: Ocho Rios, Jamaica 18 July 2012

1. United Nations International Year of Co-operatives CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD: Ocho Rios, Jamaica 18 July 2012

2. IYC 2012 Let me start by acknowledging the remarkable nature of this moment in time where we find ourselves. This period in which the International Year of Co-operatives has arrived. I don’t have to tell you that this is a time of unusual uncertainty. The future is always uncertain of course. But seldom does so much seem to be “up for grabs” , so unsettled.

3. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • Three years, ago, Liaquat Ahamed published a book titled “Lords of Finance”, • Which described the period following WWI, • When the finance ministers of England, France, Germany and the US struggled to understand the fundamentally different world they had inherited. • He makes the case that their decisions contributed to the Great Depression of the 1930s. • It was a decade of now up, now down. • Of highs and lows. • Of unusual uncertainty.

4. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • Of course, this is not the first time in the long history of the Co-operative Movement when we have found ourselves in uncertain times. • In fact, it is in times like these, • When markets aren’t functioning properly, • That we have seen significant acceptance of the Co-operative model.

5. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • Noreena Hertz, at the School of Finance at Erasmus University in Rotterdam, • Wrote recently about the need, in this post-luxe era, to replace Gucci capitalism with Co-op capitalism. • Gucci capitalism assumed that we are selfish, super-individualistic beings who care only about maximising our wealth, our salaries, our resources. • While Co-op capitalism prioritizes collective destiny; it values the network. • We are seeing increased recognition of the need for deep change.

6. CO-OPERATIVE ENTERPRISES BUILD A BETTER WORLD I don’t mean to signal, when I speak of this uncertainty, That this is a time for despair. In fact, quite the opposite. In certain parts of the globe, we see strong growth and great hope 6

7. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • And even globally, there are some very encouraging trends. • There was a recent column in the Financial Times by Simon Kuper, • Who wrote on a number of reasons to be optimistic. • He argues that, in spite of it all, these are some of the best times in history: • Life expectancy is surging, especially in “less developed regions”; • Fertility rates are plunging almost everywhere, which is generally a good thing; • Extreme poverty is falling worldwide; • AIDS and malaria are finally in retreat; • The demand for democracy is increasing; • And to top it off all of this optimism, 2012 is the UN IYC.

8. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • ICA worked hard to get this International Year proclaimed, • And now that we have it, • We’re working hard to exploit it. • I shouldn’t assume that you all know ICA. • ICA is the global body, established in 1895 by Co-operative Movements around the world • To represent and advance the Co-operative model. • Today, we have members in 100 countries, • And almost a billion individuals are members of Co-operatives affiliated to ICA.

9. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD • We know that a time of uncertainty is not when you just sit back and wait for the clouds to lift. • We know that the future is shaped; it doesn’t just happen. • Organisations like ours—like the Co-operative Movement—with solutions, • Have an obligation to shape that future, • To increase the likelihood that emerging opportunities in some parts of the world are not captured by just a few individuals, • And to insure that structural rupture in other parts of the world— • That is shutting out a generation from the opportunities they foresaw just a few years ago— • To insure that this does not linger and become intergenerational.

10. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD A Movement with the rich history of this one Also knows that a year is just the blink of an eye in the long arc of time. The key is not what we accomplish during this Year But how we use this Year to build a platform for the future. ICA believes that a strong global Co-operative brand rebounds to the advantage of our members And that the single greatest benefit ICA can provide its members Is to strengthen understanding of and appreciation for that brand. Our vision is that, if we do this well, the Co-operative will become the fastest-growing model of enterprise by the end of this decade

11. Our challenge is to make sure that more people in decision-making positions— The media, business and law schools, emerging entrepreneurs— That such people know about the scope, scale, and impact of the Co-operative sector of the economy and of our capacity to do so much more. Its is essential for members to trade their products through the Society, as this practice guarantees a sustainability of the Co-operative.

12. Consequently, we are working this Year to make strategic advances in key areas where we can build, year-by-year, to achieve that decade-end vision. The first area, and our priority, is public awareness: to increase public awareness of the Co-operative as a serious, values-based model of enterprise where the individual has a meaningful voice. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

13. We’ve opened a communications office in the UK, And we have established a relationship with a global communications and media relations firm there, To plant our substantive messages in mainstream media. We don’t want to talk about ICA; that’s of no interest to the public. We want to place stories that demonstrate the impact Co-operatives are having. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

14. If you unpack our public awareness message, there are three key components to it: The Co-operative is a serious enterprise model; It’s values-based; The members control it—you have a voice. . CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

15. We’re leading with the first message, that the Co-operative is a serious enterprise model, because we believe it is the least understood. ICA publishes a list of the 300 largest Co-operatives in the world. Last year’s list reported that those 300 Co-operatives had an annual turnover of USD 1.6T, equal to the world’s 9th largest economy. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

16. The Co-operative model is a thing of beauty at a community level, But it is scalable. It has proven its credibility as a serious enterprise model. We need to ensure that Co-operatives are not marginalised as a small model in a world without legitimate alternatives. We need to resist what I’ve heard referred to recently as the notion that “Small is beautiful. Invisible is even better.” CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

17. We have a story of success to share: The collective prominence of Brazilian Co-operatives in that nation’s economy; The health system embedded in the Japanese Agricultural Co-operatives; The growing impact of the Co-operative model in China. Our public awareness strategy is getting stories like these told, in the context of the impact they are having. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

18. The second key area where ICA is building during the IYC to position us for the remainder of the decade is in public policy. We’ve established a Washington office and are more strategically exploiting our consultative status with the UN, While building on our relationships at the World Bank. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

19.  Here, too, we have 3 core messages, which Dame Pauline Green, ICA’s President, was able to deliver at a Plenary Session in the iconic General Assembly Hall at the United Nations last October, at the opening of the International Year: First, recent history has demonstrated that we need a more diversified global economy; Second, we want equal promotion of the Co-operative model with the shareholder model; Third, we want full recognition in public policy and regulation of the specific and unique legal and financial framework of Co-operatives. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

20. We need to make the case over and over to global and national decision-makers that we can no longer depend on one dominant model of business. The global economy needs a better-balanced and more sustainable economic model. The Co-operative model is a substantial part of the solution, With a reach into every corner of the world. CO-OPERATIVE ENTERPRISE BUILD A BETTER WORLD

21. For those who doubt this vision, I can report it is already unfolding. In May, the Economist magazine carried an intriguing Briefing on “The endangered public company”. It leads with the note that “public companies have had a difficult decade, battered by scandals, tied up by regulations and challenged by alternative corporate forms.” This is not surprising to Co-operatives. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

22. We have long seen the pitfalls in the public shareholder model and have championed an alternative designed to avoid the excesses and tendency toward scandals that is inherent in that model. The Economist notes that: “Public companies are in danger of becoming like a fading London club. Their membership is falling. They spend their time fussing over club rules. And, as they peer out of the window, they see the bright young things heading elsewhere.” The number of public companies has been declining over this past decade, according to the article. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

23. This does not mean that those rejecting the public company form are necessarily choosing the Co-operative model. In fact, the article notes that private-equity firms are enjoying some of the rout; And state-owned enterprises (SOEs), which list on the stock market, account for 80% of the value of China’s market, 62% of Russia’s, and 38% of Brazil’s. Interestingly, partnerships are reversing a decline that began in the latter half of the Nineteenth Century. Family-owned businesses are also on the rise. And the article gives a nod to employee-owned businesses. This shift toward a more diversified economy is good news for Co-operatives, CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

24. Regardless of whether the shift is yet predominantly into the Co-operative model. Another reason to take heart in this change is because this will lead to a more-responsive legal and regulatory environment. The more various parties are arguing for model-specific treatment, The more receptive we can expect policy-makers to be of our argument that we need a regime that recognises the unique nature of the Co-operative model CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

25. Now, some of these alternative models are as susceptible of abuse as the public shareholder model, And some are formed by individuals looking for the greatest opportunity for exploitation with the least amount of Regulation. But a movement toward models like partnerships, family-owned businesses, and employee-owned business, is a directional move toward models where the owners have direct engagement in the business. It may be a move toward a more co-operative society and one that the Co-operative Movement should embrace. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

26. Finally, the third key area where ICA is building for the future during the International Year, is in development. We recognize that Co-operative capital cannot be just a soft concept. It has financial implications. And so we have launched a Global Development Co-operative, a USD 50 million fund To be loaned to Co-operative Development Agencies with proven expertise in growing co-operatives in developing countries. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

27. The vision of the Co-operative that we see reflected in your work here in Jamaica—the messages that I see reflected in this Symposium—are indicative of trends and attitudes we see among leading Co-operative organisations around the world. These messages of community, entrepreneurship, impact, relevancy, solutions CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

28. Are the themes that have informed and inspired ICA’s messages, And it is the demonstration of these themes in Co-operative organisations That has inspired our confidence in the future of the Co-operative model. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD

29.  We thank you for the sustained commitment you have had to a Co-operative Society, And for your ability to refresh your model and continue to make it “of our times”. CO-OPERATIVE ENTERPRISE BUILD a BETTER WORLD