People-Centred Businesses: Co-operatives, Mutuals and the Idea of Membership

Johnston Birchall provides a radical new way of seeing business organizations. Distinguishing between investor and member ownership, he enables consumer, producer and employee-owned businesses to emerge clearly from a fog of misunder-standing. Drawing on economic and sociological theories, he explains why this type of business began, survived, died out or became dominant in particular markets.

Providing chapters on: consumer co-operatives; building societies and savings and loans; co-operative banks and credit unions; housing co-operatives; friendly societies and mutual insurers; farmer and retailer-owned businesses; member-owned public services and utilities; and co-operatives in developing countries, he finds demutualization has only affected some sectors while in others the idea of membership has been revitalized.

The banking crisis has had little impact on co-operative banks, whose risk-averse business strategy is a model for a reformed banking sector. He concludes that member-ownership can be both a weakness and a strength; lack of member involvement in governance leads to business failure, while a membership-driven strategy leads to success even in very competitive markets.

Johnston Birchall is Professor of Social Policy at the University of Stirling, UK. He studied at Oxford and did his PhD at York University, UK. He spent five years as a housing association manager before returning to academic life to focus for the next 25 years on questions concerning stakeholder participation in co-operatives, mutuals and public service agencies . He has written several books on the subject (with translations into five languages), and has advised UN agencies on co-operative responses to the global economic crisis.