Co-operatives UK supports co-operative and mutual enterprises with advice and standards for good governance. This report has been commissioned from Professor Johnston Birchall in order to inform our future work and to respond to our members who may have an interest in the governance implications of introducing minority external shareholders into a business. The report is particularly timely in the context of proposed changes around the Co-operative Bank. This 'new insight' report should not be taken to represent the formal views of Co-operatives UK.
Co-operative businesses that allow external investors to take a minority ownership stake are rare, but it is possible to learn from examples worldwide among co-operative banks and agricultural co-operatives. The tensions between members and shareholders that result are real and require careful consideration in the governance design and operations of the enterprise going forward.