Last Friday, 27 students, mostly from the University of Sydney Students’ Representative Council (SRC), attended the Co-op Bookshop’s annual general meeting and attempted to expel the board of directors. But a Labor powerbroker declared dozens of proxy votes “invalid”, without giving any reason for this, and the attempted coup was thwarted.
Originally set up by students in the late 1950s — it initially operated out of a garage — the leading textbook seller has grown into the largest retail co-operative nationally, with more than 2 million members and an almost $150 million turnover. The Co-op is a chain with stores in most university campuses, its governance and business model involves students paying $25 to become a lifetime member and a shareholder in the company, which they are enticed to do by promised discounts on textbooks. However students have accused senior management of alienating their main member base and barring them from any control over the Co-op.
Students were given no notice of the AGM, which was held in Kooindah Waters, Wyong, more than 100 kilometres from the Co-op’s head office in Surry Hills. Co-op national secretary and emerging NSW Labor powerbroker Talal Yassine greeted students at the door. It’s not the first time a Co-op AGM has been held in an unusual location, in 2004 students attempted to travel to Hobart to influence the running of the organisation.
The Co-op’s annual financial records show the Co-op ran a loss of $1.4 million in 2016 and $3.7 million in 2015. The “Take Back Our Co-op” campaign argues the Co-op’s consistently poor financial performance highlights the inappropriateness of directors receiving a total remuneration of $330,000 per annum. Before the AGM, Daniel Ergas, University of Sydney SRC general secretary, submitted resolutions to vacate directors and reduce their salaries to zero. More than two dozen students who were unable to attend the AGM submitted proxies in support of Ergas’ motions.
The AGM was attended by managers and other staff from Queensland, Western Australia and other states. There were three more students than attendees who backed the board, but all the board’s motions were passed. Yassine explained that the proxies submitted in support of Ergas’ resolutions were “invalid”, though he refused to specify which requirements of co-operative national law or the Co-op’s constitution these proxies failed to meet. “You’re not here to ask questions. This isn’t QandA … I’ll ask you to have a Diet Coke and settle down please.”
University of Sydney women’s officer Katie Thorburn asked Yassine “how can you know the needs of your members, when you don’t have a typical member on the board? This isn’t a for-profit, this is for students!” According to the Co-op’s rules, to be eligible for election to the board of directors one must have “participated in the management and/or direction of a medium to large size business over not less than five years,” and have a completed tertiary degree, which effectively locks out students from the board. Yassine defended these policies, asserting that it was not in members’ interests to appoint individuals who “lacked experience to manage the organisation”.
Despite the current board’s extensive background in accounting, marketing and banking, the Co-op’s has been accused of branch-stacking, factionalism and legal disputes.
Graeme Orr, a professor of political law at the University of Queensland who was part of a faction that lost a bid for power over the Co-op to Yassine in the late ’90s, speculated that “the board is always going to be prey to the same kind of problems as student union politics … the risk of running a model where it’s one member, one vote, but most of the members don’t care about who’s running the organisation”. During Yassine’s tenure as national secretary, the board has included individuals employed by his investment bank, Crescent Wealth, and connected to him through the Labor Party.
“Holding the AGM in Wyong and declaring students’ proxies invalid without justification is astonishingly telling of the lengths that … [people] running the Co-op will go to in order to avoid scrutiny and protect their $330 000 pay package,” Ergas said. He added: “Their refusal to accept our proxies means we have an avenue to pursue legal action.”
Although the students did not expel the directors many are confident the AGM will raise the awareness the campaign needs to build momentum and eventually “reorient it to its main mission: helping students save money”.