Quakers & Business minute

Quakers & Business non-executive directors gathering 06-07/06/2011 minute:

Fourth annual gathering of non-executive directors (NxD)

06 and 07/06/2011, Woodbrooke, Birmingham

Nearly 20 Friends gathered at Woodbrooke with the theme of Organisational Structures for the Big Society.

Big Society agenda

After dinner on 6 June, Steve Wyler, CEO of LOCALITY spoke and introduced a lively discussion. LOCALITY is a newly merged organisation of the Development Trusts Association and bassac, to better serve the Big Society agenda. Steve explained the history of the movement, from settlements through development trusts and social action centres to community enterprises.

Toynbee Hall and Oxford House were the first two settlements, both in East London. A Church of England curate, Samuel Barnett and his wife Henrietta opened Toynbee Hall in 1874 as a centre for social reform. Oxford House was set up in 1884 by Keble College, Oxford to provide a centre for religious and social work.

Steve spoke about the Brynmawr Experiment between the people of Brynmawr in Wales and Worthing Quaker Meeting in 1928 to provide local employment and welfare for a community facing major challenges.

Steve gave more examples of current successful community enterprises, including:

  • Galeri in Canaerfon
  • Westway Development Trust in West London
  • Coin Street Builders in Waterloo, London
  • Community Links in East London.

Steve set out the key threats to community enterprise:

  • mission drift
  • bureaucracy and distortion to comply with the terms of grants
  • command and control by local authorities
  • local authority spin outs with only the appearance of social enterprises
  • large corporates masquerading as social enterprises.

Steve concluded that community enterprises are different from the command and control mindset of the public sector and the profit motive of the private sector and need to stay distinctive and different. We ended the evening with a lively debate on how to make the private sector pay a fair contribution for the social capital it benefits from, such as education and transport infrastructure.

This could involve:

  • new start ups contributing 5-10% of their share capital for public good
  • additional transaction tax
  • additional payroll tax.

We recognise that these may deter small, private company start ups. We were united that large corporations should pay their proper share of tax, but not as to how.

Challenges facing the third sector

After Meeting for Worship in the Quiet Room, we met up again on the morning of 7th June and began with a period of silence. Our first speaker was Patrick Andrews, Director of Riversimple. The challenges facing the third sector face us all. If we do nothing and change nothing, we will all face catastrophe. Corporations are efficient, but can be amoral or immoral in what they do and how they do it. In contrast, charities have strong values but can be inefficient and lack transparency – who appoints the board and where is their accountability?

Is there a middle way for third sector organisations to behave differently, a future role? Maybe providing large scale projects like utilities, connecting communities and reducing reliance on trade like arms production. This will require good governance which empowers, is accountable and able to serve multiple stakeholders. This needs to be achieved at scale and through networks rather than hierarchies.

Patrick asked a question. Do people want to be empowered or told what to do? Are we on a transition from being followers to being empowered? We link this to what Steve said last night about ‘fuzzy’ boundaries, where a service user can become a volunteer, staff member or trustee, depending on their life circumstances.

Patrick gave four beacons of good practice:

  • AfriKids working with children in Ghana
  • Cafedirect and its focus on suppliers as well as customers
  • Forest Stewardship Council which is stakeholder owned, with three key governance chambers, economic, environmental and social
  • Riversimple, where Patrick works and which designs a car powered by hydrogen. The six stakeholders are considered to be the owners. There is a compound board, the Custodians, the Stewards’ Council and the Operating Board.

To do just one thing, Patrick said to let go and stop trying to control! His talk led to an animated discussion on accountability, legitimacy and the Quaker spiritual dimension we bring to our NxD work.

Respecting all stakeholders

After coffee, we heard from Andrew Radford on the focus on increasing shareholder value in corporations, where shareholders have rights but not responsibilities. The model is broken and needs to be fixed in terms of structure.

We brainstormed the wide range of stakeholders of an organisation and their responsibilities, discussing these in pairs. Andrew talked about legal structures, private and public companies, Community Interest Companies, Industrial and Provident Societies and Co-operatives. Who owns the company is more important than legal structure. There are some good examples of different models such as Scott Bader and John Lewis. We heard the visionary story of Cecil Jackson Cole, a Quaker who co-founded Oxfam and founded Action Aid, Help the Aged and Andrews, an estate agency which he gifted to three charities. The estate agency operates with integrity and shares its profit with the charities to support their giving. The embedded values of Andrews resonated with our brainstorming about the responsibilities of stakeholders.

There is another way: Innovating Corporate Social Investment

Finally, Ray Sheath spoke about social business and social investment, starting with the Adventure Capital Fund which began in 2002. Ten years later, the Fund is a manager of a portfolio of 100 social investments.

We now live in a time of austerity and social entrepreneurs find it difficult to access finance. Ray is working on a new Trusteeship Business Model, in which large corporations could invest, alongside social co-investors and the social banks, including Charity Bank, Co-op Bank and Triodos Bank. There will need to be mutual benefit between the investor and the social enterprise, with appropriate support. There is a great deal of work to be done in this area and there needs to be a mindset for change. We support Ray, Patrick and others in their endeavours and hope to work with them.

In conclusion

We have heard about organisational structure and how this needs to be fit for purpose. Beyond structure lies behaviour and spirituality. As Quakers, we believe that our testimonies of honesty, integrity and truth need to be embedded and lived in our business values.

We thank Bob Tilley and all those who organised our Gathering. We end by reading this minute and hope to meet again as Friends at the 2012 NxD Gathering.

Paul Gibson, Quakers & Business Group

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