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12 March 2014

The Co-operative needs to set a higher standard

An open letter to outgoing chief executive Euan Sutherland.

By Rowenna Davis

Dear Mr Sutherland,

Congratulations on your resignation! If you do the honourable thing and leave without taking a pay-off, you could save Co-operative members like myself £3.6m in your salary alone over night – an impressively efficient move. 

I know your chair said that your pay-out was what other “comparable companies” offer, but really, most people join the Co-op because it is not a comparable company. At a time when the British public have spent billions bailing out mainstream banks, we kind of wanted something… different?

I know you were also fuming with how your pay was leaked and by the public outrage that has followed – particularly from Co-op members and candidates like myself – but you of all people should know that members are supposed to participate and hold executives to higher standards. That again is kind of the point of being a Co-operative. Plus, we were victorious. It seems that, unlike other banks, members have actually succeeded in removing you when you tried to get paid millions without actually delivering any results. 

Yes, the Co-op needs reform. But our bank didn’t fail because it didn’t pay its top people enough – it failed because it wasn’t co-operative and accountable enough. More transparency and power to members would have dislodged the appalling Mr Flowers long ago. A bigger Co-operative movement would allow a greater and more talented range of board members to choose from. Better worker representation as well as customer representation might help find alternatives to laying off 5,000 staff as in your plan. Similarly, if you’d asked us about boardroom pay in this upcoming survey of yours, and listened, we might not be in this pretty pickle. 

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Right now, the Co-op bank – just like all banks and the rest of the country – has a choice. Are we going to carry on with business as usual, handing out huge cheques regardless of success until the next crash, or are we going to fundamentally reform our banking system? It’s something George Osborne should think about in the Budget next week, but don’t worry, he won’t mention it. 

But Co-operators will. Because “The Co-op” is more than just a nice brand. Its a set of ideas and values. We believe in creating a robust and local banking system that is accountable to local people. We believe that participation and shared ownership, not big bonuses, is what leads to better banking. Co-operators work together to be radical, not make isolated decisions to preserve hierarchies between the elites and the rest. We believe it’s a time for boldness, not swallowing what failed in 2008.

Of course if you don’t believe any of this, then maybe the Co-op isn’t for you anyway. But don’t worry – sadly you’ll still find plenty of banks where you’ll fit right in. 

Sincerely,

Rowenna Davis 

Co-operative Labour Candidate for Southampton Itchen