September news and directors' forum

 We're pleased to annouce another edition of the ever popular 'Co-operative Developments', this month packed with news about Taunton Saving Together at 10 East Reach, new co-ops in solar power and woodworking and much more. Click on the icon to download.

We're especially keen that as many people as possible hear about the monthly Directors' Forum that will be meeting at 10 East Reach every first Wednesday of the month. If you are a director of a social enteprise, or you think you might like to be, you'll find this an invaluable opportunity to share knowledge, seek help with problems, learn new things and develop your skills. Whether your interest in the role of the director is for social change, career development or being part of convivial teams, this is a chance to meet others who know what it's like.

If you can get into Taunton once a month for these sessions, you won't regret it - please spread the word (with the PDF linked to this image) and encourage others to join us.

Serving the community and making a difference

You can be an effective director of a social enterprise or co-operative – as a hobby, a career or as part of a team. Whatever your background, learn business and leadership skills at our monthly support group. The social economy needs you!

1st Wednesday of each month 10.30-1pm, starting 7th October 2015 at 10 East Reach Taunton TA1 3EW.
These regular sessions will be a mix of bite-sized training and mutual aid and support for anyone interested in directing a social enterprise or co-op.
Building a healthier local economy that meets needs sustainably is everyone's
job – find out how you can best play a part.
Free, though donations around £15 a session are welcomed.
More information here.

Coming up in Somerset...

All this and much more is available in our latest newsletter - click to download!
We have more news about co-operatives making creative use of Seed Enterprise Investment Scheme; training for Directors of social enterprises; and how Tinkers Bubble is securing their site for the future.

The Co-operative Identity in the UK - a disagreement in the co-op family?

Two very interesting consultations are underway at the moment. Here, we have Co-operatives UK continuing its negotiation with the FCA with aconsultation on the co-operative identity; and here, the ICA is asking everyone's views on its interpretation of and commentary on the famous co-operative principles.
On one point, there are signs that these two key organisations for UK co-operators might be heading in different directions. Co-ops UK says:
"If the FCA is to consider participation in any way, high value should be attached to participation through ownership, democracy, capital contribution... The FCA is right to focus on preventing the co-operative form being misused
as an investment vehicle, but should focus...on cases where rates of return [are too high]" The implication appears to be that in Co-ops UK's view, there is no difficulty in mutuals being investor-led.
Meanwhile, the ICA is saying this: "...if members are not users of a co-operative’s services, the reasons for them not being users should be analysed and their right to remain members should be considered... [in] hybrid co-operatives that merge two organisational models [co-operative and investor ownership]... consideration also needs to be given to, what, if any, are to be the voting rights of non-member [ie non user] equity shareholders..." So the ICA seem to be saying the opposite: you cannot normally qualify for full voting membership unless you participate (ie use the services) in some way.
Our approach has generally been more like that of the ICA: we think non-user membership, with strictly limited voting rights, is best for people who bring valuable things to a co-operative but do not in fact depend upon it as its stakeholders do. What do you think? Anyone can respond to those consultations.
[Update: Co-ops UK have told me that they have altered their consultation to stress that "it is possible for members to benefit from the activities of a co-operative in meaningful non-financial way without them having to participate in direct economic exchange" and 'do not advocate investor only relationships'. This is good, but there are still signs that they might be willing to tolerate them.]

Bite sized training for Directors on 30th June

If you've ever thought the word 'Director' suggests a mysterious world of high finance, dubious ethics and smart suits, we hope we can reassure you - it's a job for anyone, regardless of skills or background. And social enterprises need more of them!
This short training session (coinciding with our AGM, which you're also very welcome to attend) will give you a solid grounding in both the legal and practical expectations of Directorship. It's also important to know how to get the best out of it - for some people it can help build skills, confidence and careers.
Please spread the word about this completely free session - and if you enjoy it we'll be going into more detail with a series of monthly workshops from September.

Ecological Land Co-op covered by the Independent

The Independent on Sunday has a great piece today on the Ecological Land Co-op. This is a project that Somerset Co-operative Services played a key role in initiating ten years ago. An outline paper entitled 'An Ecological Land Co-op' describes a vision of a business that will be "run by and accountable to people who are or intend to be managing land ecologically, which can buy land speculatively for ecological purposes... The co-operative would be financed by a share issue which would give it a ‘war chest’ for making purchases. Having bought land, the co-op can find the best people or organisations to manage it, and put in planning applications... Users can rent the land at a rate they can afford... When projects are well established, they can purchase the freehold, subject only to the condition that the land remains in ecological use." Well, it's here and ready to grow - visit their website to find out more.

We've been working with the Social Enterprise Mark team to develop rules that are a solid basis for businesses seeking to use this badge of best practice. SEM is all about social purpose and community benefit, which provides an obvious fit with co-operatives; but not all co-op rules are helpful in showing how member benefit and social benefit fit together. We added new options to the Co-operative Rules and, added to the Community Benefit Society and Community Interest Company versions, we now have three great ways to structure a social co-operative.
Visit SEM at www.socialenterprisemark.com to find out more about how businesses benefit from using this brand, and click on 'registrations' or read this briefing to see how Somerset Rules social accounting, stakeholder engagement and ethical business practices put co-operation at the heart of social enterprise.

Our newsletter for February 2015 - SITR yourself in a comfy chair and have a read

Yes, it's newsletter time again. In this issue we look at how Community Benefit Societies are the new co-operatives (and can be just as co-operative as the old ones); how community energy in Somerset is more energetic than ever; we say hello to the all new Social Enterprise Network; and we welcome a brace of new Somerset Rules co-operatives in the arts and events sector.
Best of all, you can get a free Citizen Finance poster listing the best tools for funding social enterprise using people power... form an orderly queue, please.
Click on the picture for the download - or you can find it with all our other newsletters on the 'About Us' page.

Intentional communities with insufficient intent

Our colleagues in Bristol enquired recently as to the results of some work we did a year or so ago with a prospective housing co-operative; we had lost contact with the group, but we knew that they had been on the brink of registering. Alas, a word with the good people of Catalyst confirmed our worst fears; nothing had come of their vision or our labour.
This is not unfamiliar to us. So many times we have met with groups who seemed to have a strong, unifying vision; yet within a matter of weeks the energy is lost. So many seem to share the same dream: the big house, a few acres, employment on site in a workers coop, a few solar panels and a lot of permaculture... On every occasion, there are challenges paying the inflated costs of such rural properties, but with three or four families to share the load, there's usually a way. So what goes wrong?
Perhaps the neuroses of home ownership are part of the story; individual members hesitate over selling their homes, worry over whether they would ever get back on the housing ladder, look for ways in which funds could be released from the co-op in a hurry... Another problem is employment; making a living in any rural location is a challenge, and the early days of founding a community are the worst possible time to be starting up a small business. But often the biggest problem is in fact the heart of the project: the moral, political or spiritual purpose. At first it's a unifying factor, sure, but all too soon it becomes divisive. Turns out people cannot think or live exactly alike, no matter how hard they try. Every attempt at adopting rules, policies, creeds or manifestos ends in disillusionment.
So if you're toying with the idea of an intentional community, don't give up too easily. Don't try and design it from scratch - copy something that already works somewhere. And make it a place where everyone thinks constantly about the shared philosophy - but never, ever talks about it.

Community shares for co-operative development

Q: What's better than investing in a community co-operative?
A: Investing in a co-operative that supports and develops many more community co-ops.
Somerset Development Workers Co-op is the team that deliver advice and support work for Somerset Co-op Services CIC. They have been the backbone of the FEED project and have been involved in supporting many new co-ops both in Somerset and beyond. Now they have a chance to significantly step up activity, with opportunities from the EU, Big Potential, Power to Change, the Somerset Rules and new premises in Taunton. But it is going place huge demands on their financial resources - which is why an issue of community shares with EIS is essential. Download the offer document if you think you might want to join a committed band of supporters.

Automatic for the people: post work co-operatives

Are we seeing the end of work? We may have thought that automation had done enough by emptying factories of workers, but now the service sector too is seeing humans replaced by robots. More and more customer relations now takes place through websites or automated phone lines; basic design and preparation of documents can be done by computers, removing the need not only for secretaries but legal assistants and even architects. This is not, however, the leisure society that many had predicted - in fact, it is turning out to be a profoundly unequal society as more and more wealth flows to the owners of capital and less and less to those who rely on selling their labour. What does this mean for co-operatives in general, and worker co-ops in particular?
I don't think automation in itself is a bad thing; it relieves us of gruelling, mindless and soulless work. The problem is - as it ever was - the ownership of these new productive technologies (and let's not forget that includes software as well as hardware). Firstly, we need to get these tools financed by large numbers of small investors, along the lines of community shares; that way, the return on the investment can be distributed much more widely. Secondly, the investors should not be owners taking a profit share but supporters receiving a far rate of interest - the profit gets reinvested to support the community that depends on the business.
That community could still be workers; but as the number of workers declines relative to the output, the case for multistakeholder co-ops becomes stronger. The local community, customers and suppliers all have a valid stake, and can strengthen the accountability that makes community shares finance possible in the first place.
John Mills, writing in the Huffington Post, points out that a great deal of investment is going into the service sector in order to achieve quite modest returns based on incremental efficiency savings. He suggests that in fact, the biggest opportunity for new technology to boost productivity is in light manufacturing - small businesses making stuff using the latest plant. So why are we seeing so few workers co-ops starting up with investment in high quality plant? There are homespun cottage industries with workers but little investment, and there are community energy co-ops that have few if any workers but plenty of investment - surely they could learn from each other.
To give a practical example: expanded polystyrene is a significant part of the waste stream, and eminently recyclable. It can be ground up and bonded together in sheets for insulation, for example, using some suitable plant. And yet the nearest EPS recyclers to Somerset are in Plymouth and Salisbury. Look for a consumer recycling point, and the situation is even more ridiculous: you'd have to go to Arundel or Cornwall! So it isn't hard to spot ethical, sustainable opportunities to invest in productive plant for added value and profitability. We just have to start building entrepreneurial teams that combine the prospective workers with others in the local community.

Raising together: a social investment handbook

We are very pleased to announce that 'Raising Together', the handbook we authored jointly with our French colleagues in CRESS and CADES, is now available for download on this very website. Follow the link above marked 'Publications'.
Raising Together is important because we site community shares in a wider and an international context; because we point the way to further opportunities like Citizen Finance Partnerships; and because we learn from French innovations that have no equivalent here, such as the Cigales investment clubs. We also have some interesting findings from surveys of social investors in the UK. Well worth a read...

Do the FCA's new guidelines threaten community co-ops?

Guardian columnist George Monbiot has kicked off a small storm with claims that the new FCA guidelines for mutual societies, following on from the recent Co-op and Community Benefit Societies Act, has sabotaged the growth of the community energy sector. Is it true?
Mostly no, with a bit of yes. It is not the case that community energy societies have lost the ability to attract investors with decent returns on investment. Social Investment Tax Relief, which is taking the place of Enterprise Investment Scheme Tax Relief for community energy, is just as good. It can only be claimed by Bencoms, but that is not a disaster: as the approval of our model rules shows, they can be just as co-operative as co-op societies; they have an asset lock to frustrate carpetbaggers; and given that all electricity is pooled in the national grid, 'community benefit' does better describe their purpose.
But it is true that the FCA is sending mixed messages about limits on interest payments. A restatement of the law ('no more than is necessary to attract and retain investment') is apparently contradicted by repeated references to savings accounts rates. It is also the case that community co-ops are treated very poorly: as Bencoms, they can't use the word 'co-operative' in their name; and as co-op societies, they can't have non-material transactions alone with their members.
Our submission to the FCA (which incorporates much of the excellent Co-ops UK response) is intended to clear these points up. In the meantime, it's business as usual.