Blog article

Expert analysis: making digital governance work for your co-operative

Linda Barlow FCILEx, legal officer, Co-operatives UK

The rapid development of digital technologies provide opportunities for co-operatives to connect with their members. Drawing on the learning from a new report on digital governance, we highlight five tips for a good digital strategy.

A new report by the law firm Bates Wells Braithwaite has highlighted the potential opportunities and threats that e-governance can bring to charities of all shapes and sizes. The report, Wired to Govern, is purposely written to help trustee boards equip their charities to meet the demands of the digital age.  However, the findings of the report contains some useful tips on how co-operatives and their boards can embrace the potential opportunities and manage the threats presented by governance in a digital age.

Drawing from the report's learnings, here are five tips for developing a strategic approach to digital governance:

1. Lead the digital strategy

It is important for boards to be pro-active and adopt a digital strategy for their co-ops. As the board of a co-op is responsible for setting the long-term strategy of the co-op, it is important that it should also lead the development of its digital strategy. Such a strategy should be flexible enough to enable the co-op to embrace new technologies, but include the necessary safeguards to protect the co‑operative’s brand and reputation.

2. Take a digital approach to democracy

Consider what technologies can be utilised to engage members who are not physically present at meetings. Virtual meetings via Skype or video conferencing may encourage greater participation from members who ordinarily find it difficult to attend a physical location for a meeting. In addition, traditional meetings can be transformed by the use of hand-held voting machines and live-streams may enable and encourage more members to participate in the decision making of the co-op.

3. Make administration of board meetings more electronic

Consider paper-free board meetings and adopt a board 'portal' - where documents can be added and shared as a replacement.  A board portal can be used to administrate meetings but can also foster collaboration and interaction among directors so that decision-making is no longer limited to a physical board meeting. Co-operatives UK has seen clear benefits in developing a central cost-effective board portal for all its governance meetings, and more importantly investing time in its directors to equip them to embrace a digital approach to this aspect of governance.

4. Develop a social media strategy

Instantaneous communication via Twitter, Facebook and other discussion threads enable co-ops to connect with their members and understand their needs. With appropriate safeguards, the strategy should encourage the breadth of the co-op’s members to utilise social media and not leave it to a few. As a safeguard though, adopt a social media policy that sets out acceptable and unacceptable use, and covers what information is confidential and controlled by the data protection policies of the co-operative. If a co-op has adopted a Directors’ Code of Conduct, it should be reviewed to ensure that it takes into account the consequences of any breach of the co-operative’s social media policy. The report provides a handy template social media policy for co-ops to use when developing their own policies.

5. Don’t lose sight of the co-op’s governing document

Adopting fresh and innovative ways of connecting with members and enhancing decision-making in a co-operative through the use of digital technologies is great, but don’t rush it. Consider first how the co-op’s governing document would fit with the development of a good digital strategy. A classic assumption that co-ops make is that electronic communication with members is an 'opt-out' decision when in fact the opposite is true. Before moving to a decision to communicate with members electronically, be prepared to set out the value of doing so to members. Canvas their opinion and take into account the real needs for members to continue to receive communications in the traditional way. Co-operatives UK can assist co-operatives to amend their governing documents to include provisions to complement a digital approach to governance. Contact us for more information.

The emergence of digital technologies is changing the nature of all aspects of business.They offer incredible opportunities for governance and membership, if they are integrated effectively.

Learn more about good governance for co-operatives at the governance strand at the Practitioners Forum on 19 November.


Disclaimer: this post is for information only and does not constitute legal advice. Should you require assistance with particular legal and governance issues then you should seek legal guidance. Co-operatives UK members can contact us for further advice.

Written by Linda Barlow
Updated: 29/11/2018