Students Fight to Dismiss Co-op Board Members
This morning, a contingent of over thirty students have driven from Sydney to Ourimbah in order to attend the Annual General Meeting of one of Australia’s largest booksellers, commonly known by students across Australia as ‘The Co-op’ bookshop, in order to expel the current Directors of the Board.
The students attending have come from the University of Sydney, the University of Western Sydney, the University of Technology and Newcastle University.
Suspicion towards the Co-op has been mounting since August last year, when the University of Melbourne’s student publication, Farrago, launched an investigation into the Co-op due to suspicions about the opaque functioning of their Board of Directors.
The very nature of any co-operative business is that the company is governed by democratically for the benefit of its members, rather than being answerable to the investors that stand to profit financially from the running of the organisation. And that is exactly how the Co-op bookshop functioned, up until about two decades ago.
A piece by The Canberra Times, published in 1993, revealed that two members of the Co-op’s Board of Directors, who had backgrounds in publishing and academia, had been dismissed in favour of a pair of accountants, who immediately lobbied the Board to raise the fees awarded to each individual Director, along with a revision of the eligibility criteria for Board election.
Since then, any control that members may have once had over the governing of the Co-op has been severely diminished. As the company stands today, there is not a single student or academic on the Board of Directors, and for any student member that wishes to run for election, there are a series of prohibitive obstacles.
As stipulated by the constitution set forth by the Co-op, any member seeking to be elected as a Director of the Board must have already completed a tertiary degree, as well as having “participated in the management and/or direction of a medium to large size business over not less than five years.”
How so, then, can the Co-op continue to lay claim to the ‘co-operative’ title whilst still operating more like any other corporate retailer? General Secretary of the Student Representative Council Daniel Ergas asked himself this question after coming across the Farrago investigation.
“I got in touch with the authors [of the article], Martin, Jeremy and Duncan. Since then, we’ve worked in tandem seeking to shine a light onto the Co-op’s lack of transparency,” he said.
“Most of us know intuitively that the Co-op is not well: it is filled with stacks of kooky merchandise that no one cares about, paired with textbooks that no one can afford.”
“It was through working with Jeremy, particularly, that we began to uncover just how opaque the Co-op and its corporate masters were.”
Looking into The Co-op’s financial report from 2014–15, Ergas and Farrago reporter Jeremy Nadel discovered that the twelve directors on the Board received a total remuneration of $330 000, despite their duties being limited to attending a total of six meetings throughout the year.
This is not the first time that students have become suspicious about the inner workings of the company.
In 2004, students Ben Hollenstein and Stephen Coles began to investigate the company’s original charter and constitution. They found the spike in the directors’ fees, coupled with the Co-op’s plummeting revenue, deeply troubling. This concern was further provoked by the lack of student representation on the Board.
“It’s like a farmer’s co-operative without farmers,” Hollenstein told The Sydney Morning Herald.
In February of the same year, the Co-op announced that their AGM was to be held in Hobart, with seemingly little regard that a mere two percent of their members lived in Tasmania.
This year, after receiving pressure from Ergas and Nadel, it appears that issues have yet again been raised with the Co-op’s choice of location, as they will be hosting their AGM not quite across the Bass Straight, but rather in Kooindah Waters on the Central Coast of NSW: a cool two-hour drive and over one hundred kilometers from their Head Office in Surry Hills.
In response, Ergas coordinated a contingent of students under the banner ‘Take Back Our Co-op’, to make the drive to Ourimbah to attend the AGM. They hope that their members’ votes and those of their proxies would be able to block the Directors’ $300 000 remuneration package and “send a message to the corporate bosses at the Co-op that students won’t let their bookshop go without a fight.”
Ergas has motioned to censure the Board and subsequently terminate all the current Directors of the Board, bar the Staff Director, as well as reducing their remuneration to $0.
“The fact that they’re holding their AGM in Kooindah Waters is astonishingly telling of the lengths that those running the Co-op will go to in order to avoid scrutiny, protect their $300,000 pay packet, and prevent the vast majority of members – students – from ever having a say. To force students to undertake a six-hour road trip to attend an AGM is farcical,” Ergas said.
Students met outside the Dragonfly Hut before the meeting
As students arrived at Kooindah Waters at 2pm this afternoon, they were instructed to turn off any mobile phones and recording devises under threat of being ejected from the meeting.
Students lining up outside the meeting room
After a motion for the previous meeting’s minutes to be carried was called for, Secretary of the Board Talal Yassine immediately called the motion carried. Member of the student contingent Katie Thorburn subsequently requested for a poll to be taken of the voting members, showing that Yassine had in fact miscounted the number of people present in the room. However, once proxies were taken into account, the motion was once again carried.
After telling the students that their proxies were invalid, Yassine attempted to silence inquisitive members, saying, “you’re not here to ask questions. This isn’t Q and A.” The Chair then refused to address why the students’ proxies were deemed invalid, despite all specification of Rule 52 of the Co-op’s constitution being followed by the submitted proxy votes.
Throughout the meeting, Ergas and Cameron Caccamo repeatedly called for motions to censure the Chair, which were continually ignored.
William Stenson, a gentleman who did not arrive with the student contingent, at this point stood to address the Chair, ensuring that the motion was both called and seconded correctly by the students, continuing to remind the Chair that they had not adequately responded to the motion. He then joined in the student vote to censure the Board amidst a round of applause, which did not carry.
Stenson then motioned that the financial statements be posted in a more transparent means on the Co-op’s publically accessible website. This passed with support from the staff of the Co-op.
As the meeting turned to question time, a heated debate was raised concerning the accessibility of the AGM for students who would not have otherwise had access to a vehicle.
“I’ll ask you to have a Diet Coke and settle down please,” was Yassine’s response.
Katie Thorburn then requested the list of proxies that were allocated to each member, so that the invalidation of the students’ proxy votes could be clarified, which was flatly refused by the Chair.
“How can you be for the benefit of members if you are not being accountable to the members?” Thorburn said.
The meeting was then declared closed against the will of the student contingent amidst angry calls for clarification. When approached at the end of the meeting, both Yassine and the Chair refused to give any reason for the invalidation of the proxies, despite repeated demands.
“We are entitled to say no, whether or not you accept that answer.”