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| Co-op Group members approve sweeping reforms to board | |
| (35 minutes later) | |
| Co-op Group representatives have voted unanimously in favour of proposals to overhaul the way in which the 150-year-old British mutual is run. | Co-op Group representatives have voted unanimously in favour of proposals to overhaul the way in which the 150-year-old British mutual is run. |
| At a special meeting in Manchester, delegates approved a motion calling for elected board directors and greater powers for individual members. | At a special meeting in Manchester, delegates approved a motion calling for elected board directors and greater powers for individual members. |
| The proposals broadly reflect reforms called for in a report by ex-City minister Lord Myners, who called the Co-op "manifestly dysfunctional". | The proposals broadly reflect reforms called for in a report by ex-City minister Lord Myners, who called the Co-op "manifestly dysfunctional". |
| The group lost £2.5bn last year. | The group lost £2.5bn last year. |
| It has been mired in controversy, with its banking arm facing near-collapse last year, and the resignation of chief executive Euan Sutherland in March. | It has been mired in controversy, with its banking arm facing near-collapse last year, and the resignation of chief executive Euan Sutherland in March. |
| Co-op Group's chair, Ursula Lidbetter, welcomed Saturday's vote, calling it a "highly significant moment" for the organisation. | Co-op Group's chair, Ursula Lidbetter, welcomed Saturday's vote, calling it a "highly significant moment" for the organisation. |
| She added: "There is a huge task ahead of us if we are to deliver the reforms necessary to restore the group's reputation and return it to health, but the board will work hand-in-hand with our members to ensure that we seize this opportunity." | She added: "There is a huge task ahead of us if we are to deliver the reforms necessary to restore the group's reputation and return it to health, but the board will work hand-in-hand with our members to ensure that we seize this opportunity." |
| Following the vote, Lord Myners told the BBC his "work here is done," and that he was thrilled by the unanimous approval. | Following the vote, Lord Myners told the BBC his "work here is done," and that he was thrilled by the unanimous approval. |
| He said it marked a "turning point" for the group. | He said it marked a "turning point" for the group. |
| Four proposals | Four proposals |
| Following the standard annual meeting, a special session was held to vote on a motion containing the following four proposals, which reflect some suggestions made by Lord Myners: | Following the standard annual meeting, a special session was held to vote on a motion containing the following four proposals, which reflect some suggestions made by Lord Myners: |
| That motion was backed by Co-op Group chair Ms Lidbetter and interim chief executive Richard Pennycook. | That motion was backed by Co-op Group chair Ms Lidbetter and interim chief executive Richard Pennycook. |
| The details of the proposals will now be refined and put forward to members at an upcoming meeting. | The details of the proposals will now be refined and put forward to members at an upcoming meeting. |
| Earlier this month, a review of the group by Lord Myners concluded the board was "manifestly dysfunctional". | Earlier this month, a review of the group by Lord Myners concluded the board was "manifestly dysfunctional". |
| The report suggested replacing it with a smaller board made up of people with business experience. | The report suggested replacing it with a smaller board made up of people with business experience. |
| Lord Myners called the Co-op Group "one of the great national business calamities", and said "radical decisions on governance structure need to be taken very soon - and with resolution - if the Co-op, as my mother knew it, is to be saved". | Lord Myners called the Co-op Group "one of the great national business calamities", and said "radical decisions on governance structure need to be taken very soon - and with resolution - if the Co-op, as my mother knew it, is to be saved". |
| He added that elected members would have to show "selfless sacrifice" to push the reforms through. | He added that elected members would have to show "selfless sacrifice" to push the reforms through. |
| Euan Sutherland, who resigned as boss of the Co-op Group in March after 10 months in the job, said the organisation was "ungovernable". | Euan Sutherland, who resigned as boss of the Co-op Group in March after 10 months in the job, said the organisation was "ungovernable". |
| Fall from grace | |
| Co-op Group's former chief executive, Sir Graham Melmoth, who stepped down in 2002 having been credited with reviving the organisation's fortunes, told the BBC "most people will find something that they can generally support" in the motion. | Co-op Group's former chief executive, Sir Graham Melmoth, who stepped down in 2002 having been credited with reviving the organisation's fortunes, told the BBC "most people will find something that they can generally support" in the motion. |
| "I'm immensely disheartened and sad that a great institution has got to this stage," he added. | "I'm immensely disheartened and sad that a great institution has got to this stage," he added. |
| But Sir Graham insisted that governance reforms were "almost secondary" to battling the levels of indebtedness at Co-op Group, with the banks "sitting on the neck" of the beleaguered mutual. | But Sir Graham insisted that governance reforms were "almost secondary" to battling the levels of indebtedness at Co-op Group, with the banks "sitting on the neck" of the beleaguered mutual. |
| "It wasn't so long ago that the balance sheet looked very respectable. You could take it anywhere - its covenant was absolutely first-class - now it's a great fall from a great height and we've got to get back there." | "It wasn't so long ago that the balance sheet looked very respectable. You could take it anywhere - its covenant was absolutely first-class - now it's a great fall from a great height and we've got to get back there." |
| Although the Co-op has nearly eight million members, making it Britain's largest mutual, only a few hundred got to vote in Saturday's meeting. | |
| Unlike in corporate companies, where each share entitles the holder to one vote, Co-op members vote for their regional representatives, who in turn vote at the annual general meeting. | Unlike in corporate companies, where each share entitles the holder to one vote, Co-op members vote for their regional representatives, who in turn vote at the annual general meeting. |