Business schools ‘ignore cooperatives’

Graduate programmes tipped to lure disillusioned millennials

December 16, 2018
Source: Getty
On board: students learn about ‘a different type of successful business model’

An Australian university is tapping into millennial idealism and tackling a global blind spot with a specialist management programme focused on member-owned organisations.

The University of Newcastle’s graduate certificate in cooperative management and organisation claims to be the only course of its kind in Australia, and one of just a handful in the English-speaking world. Morris Altman, the dean of the Newcastle Business School, said that although cooperatives and mutuals produced about 4 per cent of global gross domestic product – and about double that proportion in some anglophone countries – they were overlooked by business faculties and derided as the preserve of “people who have ponytails and smoke marijuana”.

“They’re [perceived as] organisations on the margins, not drivers of economic growth and development,” Professor Altman said. “That’s a misperception by people who run business schools and teach management, economics and law.

“When people are hired as CEOs of cooperatives, the first thing they think is, ‘Let’s demutualise because cooperatives are losers.’ Why would you think demutualisation is a way forward if you appreciate the profitability, the efficiency, the effectiveness of cooperatives and mutuals?”

Professor Altman said that cooperatives were prominent in the UK, Canada, Australia, New Zealand, the Netherlands, Italy and Spain’s Basque region, playing an important role in agriculture, superannuation, banking, manufacturing and retail.

They are highly resilient business organisations, he said, which offer small enterprises the productivity benefits of scale. “You can mimic a big company by creating a cooperative,” he said.

Many co-ops offer in-house training schemes, but they are limited in scope. Newcastle’s programme – which can be completed part-time in six months, or rolled into a specialist MBA on cooperatives – covers the international context, the legal environment and management approaches.

“If you run a co-op like you would run an investor-owned firm, you won’t get the productivity and quality advantage of operating like a cooperative,” he said. “Our programme is providing people with tools to understand and appreciate how to run a different type of successful business model.”

St Mary’s University in Halifax, Canada, also provides graduate diploma and master’s programmes in cooperatives. In the UK, the Co-operative College, a Manchester-based educational charity, offers a postgraduate certificate accredited by Sheffield Hallam University and St Mary’s in Canada, and is introducing an MA next year in partnership with Manchester Metropolitan University.

Professor Altman said that Newcastle hoped to explore joint offerings with other Australian universities. “But right now, we’re the only game in town. In spite of the fact that this sector produces billions and billions of dollars and services, and employs millions and millions of people, we’re unique,” he said.

Professor Altman said that he expected students to be attracted to the sector as they sought more ethical employment – particularly in the wake of Australia’s royal commission into banking, which has uncovered abuses such as routine charging of fees from dead people’s estates.

“Co-ops aren’t there to lose money, but they’re not going to make money in the way that some of the private investor-owned banks work,” he said. “Cooperatives are growing because people don’t trust the big banks.”

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