Cooperatives and family businesses

Cooperatives provide a significant contribution to the economy, a large proportion of the UK’s economy is also supported by family businesses. Indeed, it is estimated that family businesses account for almost 25% of the UK’s gross domestic product (GDP). As such these two areas are of increasing importance when considering the accountability and governance responsibilities of organisations. With new questions arising every day to challenge the contributions that cooperatives and family business make to our communities, it is essential that we have the tools to clearly demonstrate their worth. Likewise, given the importance of the role boards play in the success or failure of cooperative organisations and family businesses, and the importance of these organisations in the wider economy, it is prudent to develop some knowledge and understanding of the complexities of the way in which these boards are structured and the role that they play in achieving accountability and governance within their organisation. The chapter considers the following: who governs; board roles and board relationships with management; board size and director selection processes; the importance of board members participation; and the input of managers in relation to accountability and governance in these two sectors. The chapter begins with a short overview of the evolution of cooperatives and what constitutes a family business. This is followed by a discussion of the organisational model and governance structures and their effectiveness