Cooperatives Showcase Their Mutual Benefits

27 March 2012
Cooperatives Showcase Their Mutual Benefits in World-Wide Celebrations

Overwhelmingly New Zealanders are looking for honesty, integrity and high ethical standards and the failure of the finance companies has seriously shattered investing confidence.

Announcing the results of a Horizon Research survey conducted last week across 1000 people, the chairman of the NZ Cooperatives Association, Mr Blue Read said 70 percent of New Zealanders were now “less trusting” or “totally distrusting” of the honesty and integrity of businesses in New Zealand following the recent finance company failures.

Mr Read said New Zealanders wanting an alternative needed to look no further than the cooperative structure, which is well entrenched in our economy, was based on different principles to the investor-driven corporate businesses and had weathered the global financial crisis in relatively good shape.

“The Horizon Research shows 52 percent of New Zealanders prefer businesses that are owned by the people who use the businesses and 55 percent place greater trust in cooperatives,” he said. “An overwhelming majority of people don’t know about cooperatives, but are keen to learn more.”

“Cooperatives are making it through the global financial downturn a lot more intact in terms of their financial equity, integrity and reputational performance,” said Mr Read in launching the UN International Year of Cooperatives 2012 in New Zealand at Parliament today.”

The International Year of Cooperatives is a chance to highlight cooperative’s global successes, economic importance and contribution to the wealth of New Zealand.

“Cooperatives take a long term view and put the future of their members ahead of short term profit. I think consumers and producers are looking for entities they can trust, where there is a mutual benefit to doing business that’s not lopsided,” Mr Read said.

“New Zealanders have an innate knack of looking at a situation and very quickly working out what’s a fair deal and what’s not. This is especially the case in rural areas where it is no exaggeration to say that cooperatives form the backbone of the New Zealand economy.

“The cooperative ethos in many way suits the New Zealand psyche. Kiwi values are those of truth, honesty and integrity,” he said
“Cooperatives feature prominently in all parts of the New Zealand food industry and contribute 3 percent of GDP. The top 40 cooperatives are headed by dairy giant Fonterra and have a collective turnover of more than $39 billion for the 2010/11 year -- an increase of $4.6 billion over the previous year at a time when worldwide economies were in meltdown.”

Today the New Zealand Cooperatives Association has more than 50 members. Some are very big by world standards like Fonterra, with its turnover/revenues of more than $19 billion and owned by 10,500 dairy farmers.
Foodstuffs with its PAK’nSAVE and New World brands, and the farmer-owned meat processing companies Alliance and Silver Fern Farms are also large business operations that are ranked in the world’s 300 largest cooperatives.

“Rabobank Group is one of the world’s most trusted banks and plays a significant role in the New Zealand agricultural industry where it specialises, started in Holland when farmers needed to band together, provide finance and help each other” he said.

“There are cooperatives and mutuals in a wide variety of sectors, such as credit unions, banking, financial services, retailing, taxi companies, fruit packing and vehicle repair shops. The scale and diversity of New Zealand’s cooperative sector means that cooperatives play a key role in the daily lives of a significant number New Zealanders. Cooperatives also significantly contribute to the achievement of the Government’s economic objectives.

Mr Read said the International Year of Cooperatives was a unique opportunity to raise awareness of the business model, which has been around in New Zealand since 1871, when eight Otago dairy farmers each put up one pound to start their own cheese business.

“This year is an opportunity to work with Government and professional groups such as lawyers and accountants to facilitate the environment, which nurtures and supports the cooperative and mutual way of doing business in New Zealand,” he said.

COOPERATIVES IN NEW ZEALAND

$39.6 billion combined revenues in 2010/11 from Top 40 NZ cooperatives and mutuals

Up $4.4 billion compared to revenues in 2009/10

Fonterra has 10,500 farmer-members with annual revenues of $19.8 billion

Three Foodstuffs cooperatives (Auckland, Wellington and South Island) have a combined turnover of $8 billion, making them together the third largest business in the country

Foodstuffs is New Zealand second, third and fourth biggest cooperatives and provides 4000 jobs

Meat processing cooperative Silver Fern Farms is fifth with $1.8 billion and provides 7500 jobs

The other meat processing cooperative, Alliance Group, is sixth with revenues of $1.3 billion and provides 5600 jobs

These six New Zealand cooperatives are in the Global 300 list of the world’s largest cooperatives

Netherlands-based Rabobank is the world’s largest rural bank and a major agricultural sector lender in New Zealand

With over NZ$1 billion in assets, Rabobank’s AA credit rating is better than both the Governments of New Zealand and Australia

There are 32 Rabobank branches throughout New Zealand with more than 250 employees, almost half in regional locations

Collectively NZ cooperatives and mutuals provide more than 43,000 New Zealanders with jobs

With vehicle repair shops as members, Capricorn Society has members in New Zealand, Australia and South Africa – a tri-nations cooperative with a turnover of more than $1 billion

Started in 1928, The Co-operative Bank, with 137,000 members, has the largest number of members of all New Zealand cooperatives

Cooperatives contribute 3 percent of New Zealand’s GDP

COOPERATIVES GLOBALLY

Cooperatives worldwide are owned by 1 billion people

They employ over 100 million people globally

The biggest 300 cooperatives have a combined turnover of $NZ1.9 trillion

Collectively the top 300 cooperatives are as large as Spain, the world’s 9th largest economy

ENDS

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