Spotlight Interviews with Co-operators

Antony McMullen, Cooperative Development Expert

“Spotlight Interviews with Co-operators” is a series of interviews with co-operators from around the world with whom ILO officials have crossed paths during the course of their work on cooperatives and the wider social and solidarity economy (SSE). On this occasion, the ILO interviewed Antony McMullen, Cooperative Development Expert.

Article | 27 July 2021
Antony McMullen (sitting on the right)
Antony is an expert cooperative developer committed to building local prosperity for the common good. His passion for good governance is recognized through his designation as Fellow of the Governance Institute of Australia (formerly Chartered Secretaries Australia); he co-drafted the Business Council of Co-operatives and Mutuals (BCCM) Co-operative and Mutual Enterprise best-practice governance framework. He holds qualifications in social impact (social entrepreneurship), community development and cooperative leadership. Antony has helped develop and has co-founded several cooperatives, serving on c-operative boards as both Secretary and Chair, so he has a firsthand understanding of the benefits and challenges of the cooperative business model. He is the co-founder of the first cooperative co-working space in Melbourne - 888 Co-operative Causeway – which hosts regular social and solidarity economy events and even a podcast (The Co-operative Way). From 2017-2020 he was Secretary and co-founder of Co-op Incubator (an online community established to facilitate cooperative entrepreneurship). He is Co-convenor of the New Economy Network Australia (NENA) Co-operatives Sectoral Hub (along with Anthony Taylor of the BCCM). Antony has provided support to a range of cooperative start-ups (via the cooperative he co-founded and serves on as Secretary and Director – Co-operative Bonds) including: bHive; Cooperative Power Australia (CoPower); Earthworker Co-operative (also a member) (and Earthworker Co-ops Redgum Cleaners Cooperative and Earthworker Energy); and, ORICoop (also a member and serves on the Organic Farmers Bushfire Appeal sub-committee of the cooperative). Antony is a member of the Australian Services Union and Professionals Australia and is a Fellow of the Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA). He writes regularly on the social and solidarity economy (some of his articles can be found here).

Antony McMullen, on the right, listening to community elder Basil Varghese at a recent event sponsored by the 888 Co-operative Causeway, a cooperative co-working space that he co-founded. Antony also co-founded Co-operative Bonds, a cooperative of cooperative developers that works to enable communities to establish or redevelop innovative member-owned enterprises in the social economy.

Could you tell us about your background and how you got involved in working with cooperatives?

Growing up in Narrandera; a country town in rural New South Wales (NSW), cooperative businesses were certainly a feature of everyday life. Some, like Yenda Producers Co-op which I remember hearing about in my younger days, are still flourishing today. Thinking about this more deeply, perhaps there was a bit of it in my DNA. Later on in life, I met some long lost family members and found out that my grandfather worked for the Australian Mutual and Provident Society (AMP) - a significant mutual enterprise in the history of Australia that specialized in life insurance. It was later ‘demutualized’ and subsequently became an unfortunate subject of a recent Royal Commission into the financial services sector in Australia.

I first became seriously interested in cooperatives when I studied community development at Swinburne in the late 1990s. A teacher talked about Mondragon (the autonomous Basque region of Spain) and the example of Fr. José María Arizmendiarrieta Madariaga (known affectionately as Arizmendi) who established a mutually supporting network of worker cooperatives in that area following the Spanish Civil War. These days, the Mondragon Cooperative Corporation features 260 employee-owned enterprises (everything from large-scale manufacturing through to supermarkets) with annual revenues in excess of $20 billion (and it is the fourth largest employer in Spain).

There has been a renewal of interest in the cooperative and mutual form of social enterprise in Australia, where we put cooperatives and mutuals together under one term as Cooperative and Mutual Enterprises (CMEs).

I am currently working with Earthworker Co-operative, Solidarity Hall and other international partners by chairing a committee that is organising a global event - on the 29th of November this year - to mark the anniversary of Arizmendi’s death in 1976.

The inspiration of Mondragon has continued to influence my approach to cooperative development. It is not a matter of building one isolated cooperative at a time with the hope that the world will change for the better. For a true social and solidarity economy we need to prioritize the 6th Cooperative Principle - cooperation amongst cooperatives locally and globally - so as to provide a real alternative to neoliberalism. We have to learn to work together much more closely. We need to then trade with each other for mutual benefit. We must mentor each other. Importantly, we must build education opportunities for the broader community to learn about what we do, and why.

Could you tell us about the cooperative movement in Australia (its history, sectors of strength and its organizations)?

Australia has a strong history when it comes to CMEs. However, as Garry Cronan pointed out in a recent podcast that I host (The Co-operative Way) in the 1980s onwards there was a wave of demutualization. Many well-known Australian cooperative businesses like Wesfarmers (which was birthed by a rural farmers union) demutualized and listed on the stock market. As a child, I remember receiving a small payment from the then St. George Building Society when it demutualized and became a mainstream bank owned by investors. This trend has had a real impact in relation to eroding a sense of social responsibility in the Australian economy. I remember talking to a senior employee at a life insurance fund under CME management about the main difference he experienced post-demutualization. He said that he did not think there would be much of a difference at first, but was shocked that almost overnight the discussion focused away from member benefit, to the interests of external shareholders. This shift has a real impact on the ways that enterprises act in the economy. Do they focus on customers as members and act in their best interests or do they incentivize their employees to fleece them for all they are worth?

That said, around 80 per cent of Australians are members of a CME and the sector in Australia is a significant part of the Australian economy. The total revenue for the top 100 CMEs was $32.8bn AUD last year with combined gross assets of more than $1.1 trillion AUD including superannuation funds (super funds are employee pension funds jointly governed by unions and employers in Australia). There are more than 2,000 CMEs in Australia. Key sectors include financial services, health insurance and agribusiness.

©Business Council of Co-operatives and Mutuals National Mutual Economy (NME) Report 2021.
The worker cooperative movement is relatively small in Australia but there is growing interest in this area (helped along by think-tank cooperatives like the New Economy Network Australia). Earthworker, inspired by Mondragon, has created two groundbreaking worker cooperatives - Earthworker Energy (they made the solar hot water unit that I use for my home) and the Redgum Cleaning Cooperative which provides good quality work for its employee owners - and an ethical green cleaning alternative for their customers. In the extended COVID lockdown in Victoria some of these customers continued to pay even though Redgum cleaners could not come to their home. That’s solidarity in action.

Is ‘principle 6’ - cooperation amongst cooperatives a reality in Australia?

At a broad systemic level we have the BCCM advocating for the sector and movement - it has been doing an incredible job over the years by changing the way Governments and communities view cooperatives as an integral part of our economy. In 2015, it secured and led the sector response to a Senate Inquiry into Cooperative, mutual and member-owned firms, which highlighted a range of areas ripe for reform. This inquiry recommended that cooperatives and mutuals should be better represented in government policy discussions, that the education system should include cooperatives and that legislation should be amended to better support capital raising in mutuals. It was remarkable to hear from all sides of politics getting behind cooperative and mutual enterprise. In Australia, we are fortunate that all the major parties - as well as independents - support cooperative and mutual business development. More recently, the BCCM has been delivering a cooperative education program for farmers on behalf of the Government called Co-operative Farming, which provides incredible online education resources, guides and templates that can save cooperatives loads of time and money when starting or further developing their cooperative - as well as raising capital (it is important to note that many of the resources work for all kinds of cooperatives - farming or not). I have been lucky to work with a range of farming cooperatives developing their ideas across Australia via this initiative. The Co-operative Federation also plays an important part in a range of local communities.

Cooperation amongst cooperatives is an important principle to advance and defend. Without this commitment, there are simply a few good social businesses here and there. We need more than that …

How have Australian cooperatives and mutuals responded to the COVID19 global pandemic?

The Australian cooperative movement has recently produced a report on the significant contribution made by CMEs in Australia. It found that the lifespan of top CMEs average 82 years, which is 25 percent longer than similar top companies listed on the Australian Stock Exchange. The report found that CMEs prioritize keeping on workers to meet the needs of members in a crisis and that they can more easily do this through the use of reserves kept aside for just this kind of purpose. They are focused on benefiting their members in communities and their employees.

What’s happening in Australia in relation to investment in cooperatives?

There is a lot happening in the area of CME investment. Co-operative Bonds works with all kinds of groups providing education about how they can raise capital in their local communities. Recently with my Co-operative Bonds cooperative development hat on - I did some work with a community from the suburb of Montmorency in Melbourne - they have been using cooperative shares to raise community investment. I was lucky enough to also interview the coordinator of the project Marissa Johnpillai on The Co-operative Way podcast (find the interview here).

On the other end of the scale, we have seen AU $120 million (about US $90 million) recently raised by Australian Unity via the first issue of a new investment type - Mutual Capital Units (MCIs). This is a huge leap forward in Australia. Previously, mutuals could only really rely on retained earnings or debt to raise funds to expand and grow their social business. Now they can raise capital in the form of MCIs without members losing control. The new model is attracting socially focussed investors looking for alternatives to the mainstream end of investment that is all about profit maximization and little else. The funds raised by Australian Unity will be going towards increasing investment in social infrastructure in health insurance, care services and mutual banking. Australian Unity started life as a Friendly Society in 1840 and they are continuing to build on that legacy of mutual support in new and innovative ways.

What are the key challenges that the Australian cooperative movement needs to address in terms of preparedness for the future of work?

Worker cooperatives need to be presented as a real option for business transition and for people who want to start new businesses. Organizations like Employee Ownership Australia are doing a lot of valuable work in this area but there is so much more to be done. Worker cooperatives are a bit of a foreign concept in Australia. In some ways Australia needs to go back and draw from its own history to go forward in this area. A few years ago, I visited the Electrical Trade Union (ETU) in Melbourne to seek support for a cooperative crowdfunding campaign I was working on. In the lift there was a reproduction of the poster that promoted the formation of the precursor to the ETU many, many years ago. The poster said that the meeting would occur at the ‘co-operative tea rooms’ and that the poster itself was ‘printed by co-operative labour’. Cooperatives are infrequently referred to in the labour movement these days but there are shining exceptions such as Godfrey Moase of the United Workers Union who has helped found Co-operative Power (CoPower). Things are moving in the right direction.

More broadly, it is important that cooperatives become part of mainstream education. It is very possible for those currently studying corporate law, accounting, and business management to have never heard of cooperative business. When a startup seeks advice from these newly-graduated professionals, a cooperative won’t even be presented as an option.

Another challenge is to bring the social enterprise and cooperative movements closer together in Australia. It might seem strange to people in other parts of the world, but we don’t talk to each other enough. I wrote an article about this, challenging us all in the social and solidarity economy to come together to build back better (Co-operatives - the slow food of social enterprise). Cooperatives are a form of social enterprise.

What do you see as emerging sectors and opportunities for the cooperative movement in Australia in building back better?

There are so many opportunities. A groundbreaking initiative in a regional centre here in Victoria, bHive in Bendigo is the first ‘platform cooperative’ in Australia that allows neighbours to share resources and skills in their local community; and, they plan to establish a ride-share platform to rival Uber. For these shoots of innovation to grow into something much bigger will require established CMEs to further develop their practice of the 6th cooperative principle and find ways to support startups like bHive in a mutually beneficial way.

I noticed recently that Co-operative Power (CoPower) is offering its members $200 AUD off Earthworker Co-operative C02 heat pump hot water systems. This is one relatively small cooperative getting behind another cooperative by providing a great offer to their members. Everyone wins. Imagine if some of our larger cooperatives got behind our smaller ones? This could really build up the social and solidarity economy in Australia - 8 out of ten Australians are members of a CME but they may not even know it. That needs to change.