It was a very good year for co-ops.
In New York the United Nations declared the International Year Of Cooperatives. When the UN declares a year for your cause you know you’ve arrived.
In Belgium the International Co-operative Alliance (ICA) published a Blueprint For A Co-operative Decade. It challenged the billion co-op members around the world to build the fastest growing sector of the global economy by 2020.
In Italy the inaugural edition of the World Co-operative Monitor was published by the European Research Institute on Cooperative and Social Enterprises (Euricse). It recorded that the top three hundred co-op enterprises around the globe had revenues of more than $2 trillion.
And in Canada the financial giant Desjardins Group (No. 38 on Euricse’s Top 300) co-hosted the biggest blowout the cooperative sector had ever seen. At a cost of $10 million, more than 2,800 people came from more than 90 countries for the International Summit of Cooperatives in Quebec City.
The year was 2012, known still among cooperators as IYC. The United Nations has been designating “international years” for more than half a century to draw attention to major issues and encourage action. The year for co-ops was meant to raise awareness of ways that co-ops fight poverty, create jobs and improve social integration. It would also highlight the cooperative model as an alternative way to do business. Ban Ki-Moon, UN Secretary-General, said “Cooperatives are a reminder to the international community that it is possible to pursue both economic viability and social responsibility.”
The International Co-operative Alliance, formed in 1895, is at the apex of the worldwide cooperative movement. (Apex is the actual term in use for top-level co-op associations.) Responsible for the usual industrial association concerns, primarily lobbying, the apex also maintains focus on the principles that underpin all cooperative activities. There are seven co-op principles, primarily calling for open, democratic, informed and equitable operations in member-owned enterprises that run the gamut from daycare, housing and farming to renewable energy, insurance and banking. The apex is keeper of the flame with particular emphasis on the sixth principle that calls for cooperation among cooperatives. ICA claims to represent 1.2 billion members in some 2.6 million cooperatives worldwide.
At the head of ICA in 2012 was Dame Pauline Green, a force of nature who was born in a British barracks and traipsed from post to post wherever her father was stationed. With scarcely any formal education, she found secretarial work, then a spot on the police force. A determined run of adult studies culminated in an M.Sc. from the London School of Economics and an interest in politics. In 1989 she won North London’s seat in the European Parliament. As leader of a socialist wing she became a strong advocate of parliamentary reform, was re-elected twice and after a decade there were rumours she would stand for Mayor of London. Instead, on New Year’s Day 2000 she became chief executive of England’s biggest consumer cooperative, leading it through a decade of merging with the second biggest and responding to 60 recommendations from an independent commission charged by Prime Minister Tony Blair with finding ways to develop and modernize the co-op sector. A decade later she would hand off this torch and pick up another in Brussels as president of ICA.
Nailing commitment for a UN-sponsored international year is not a breeze – there are lots of claimants for UN years – but Dame Pauline was no stranger to the complexities of international politics. (As well as Dame Commander of the Most Excellent Order of the British Empire, she holds honours from Greece, Austria and Cyprus.) Soon after she signed on with ICA, 2012 was designated the UN’s International Year of Cooperatives. Dame Pauline then set out to make sure IYC would be the first of the best ever years for co-ops.
The Blueprint would set the agenda, building on IYC for the decade to follow. The ambitious plan, labeled 2020 Vision, was for the cooperative business model to become not only the fastest growing form of enterprise but also the model preferred by people as well as the leader in economic, social and environmental sustainability. It was asking for a lot in perilous times. The shockwaves from the 2008 financial meltdown had hardly subsided. But Dame Pauline saw it as a moment of historic opportunity As the Blueprint put it, “With political institutions in many nations struggling to keep up with a rapidly changing world, it is essential that citizens become increasingly resourceful, enterprising and co-operative . . .
“The co-operative model is a commercially efficient and effective way of doing business that takes account of a wider range of human needs . . . Uniquely among models of enterprise, co-operatives bring economic resources under democratic control. It is an approach that works on a very small and on a very large scale.”
The Blueprint was meant to stir the troops to take the co-operative message to the wider community. To provide evidence for co-op evangelists, ICA helped launch the annual World Co-operative Monitor. Its seventh edition in 2018 surveyed more than 2,500 organizations worldwide, 40% in insurance, banking and financial services, 35% in agriculture, 19% in wholesale and retail trade and a sprinkling in industry, utilities, health, education and social care. More than 1,100 of them had turnover above $100 million in 2016.
The Blueprint and the Monitor cost a pretty penny between them. Money is scarce at the apex of co-operatives, where there is a strong tendency always to look for ways to spend less. There’s no budget, for instance, to pay the full-time president of ICA. The president comes to office on his or her own dime, or in the case of Dame Pauline on the dime of The Co-operative Group, where she had been CEO. With its origins among people without capital coming together in groups to buy or to build what none could manage alone, spending less is in the co-op DNA.
But of course 2012 would be different. For a celebration, the sector would put its best foot forward. And whatever the costs of the Blueprint and the Monitor, they paled in comparison with the Quebec Summit. If IYC was the crowning of the global co-operative movement, the Summit was its crown jewel.
The International Summit of Cooperatives, intended to showcase the business achievements and potential of cooperatives, took two years to organize. Engaged to lead the team and produce the event was Stéphane Bertrand (left), an imposing (>6’4”) PR pro who previously had been chief of staff to Quebec Premier Jean Charest. It featured more than 150 speakers over four days in October 2012, published 44 academic papers in a 665-page book and sponsored nine studies considered “groundbreaking” because so few studies of cooperatives had ever been done. Two-thirds of the studies were presented by the four top international consulting firms, McKinsey, PWC, Deloitte and E&Y.
There would be dozens of corporate contributors to the Summit. The federal and Quebec governments each kicked in $1 million. But the chief organizer and biggest backer by far was Desjardins Group, which housed the organizing team and absorbed a multi-million dollar loss. The executive director of Canada’s co-op apex at the time, Denyse Guy, observed that Desjardins was the only organization in the country with the resources to back such a project. Her own institution, the Canadian Co-operative Association, speaking for 9,000 co-op businesses and 18 million members, had lived within the same constrained budget of $2 million for a dozen years. Zero annual increase. (When CCA merged with its Quebec equivalent and formed Co-operatives and Mutuals Canada, CMC, in 2014, the budget actually decreased.) Denyse Guy would later be invited to join the board of directors for the Summit.
Desjardins Group has unique status within Quebec, among cooperatives and as part of the financial sector. It’s the sixth largest financial institution in Canada with assets over $275 billion, ranking just after the big five chartered banks, and far-and-away the largest cooperative in the country, with seven million members of the eighteen million national total. (In Bloomberg’s annual ranking of the world’s strongest banks, Desjardins Group is usually among the first five. It’s unique among them in that it isn’t a bank at all. It is a caisse populaire, comme on dit au Québec, which is the same thing as a credit union anywhere else. Quite distinct from commercial banks, credit unions are part of the co-operative sector of the economy.)
The CEO of Desjardins in 2012 was Monique Leroux, 58 but looking mid-40s. Fluently bilingual, awesomely intelligent, petite and beautifully chic, she would be rara avis in any culture. Since taking the reins in 2008 she had played Desjardins to center stage of the co-operative world with the fierce determination of a born competitor and the grace and skill of the concert pianist she trained to be, before opting for accounting as a profession.
Ms. Leroux studied at the Conservatoire de musique du Québec while growing up in a suburb of Montréal. But she says “modest family circumstances” precluded going on to Europe, the next step in a classical career. Turning to business studies she found her credits in music were of little use in a commerce course but she was accepted at a branch of the Université du Québec in Chicoutimi, a borough 450 miles northeast of Montreal. After graduation she joined Ernst & Young where she managed corporate and large business sectors and became its first female consulting partner, then transitioned to VP at the Royal Bank and had a stint at troubled printing and media giant Quebecor before joining Desjardins in 2001.
She rose to the top job at Canada’s largest co-op shortly before Lehman Brothers filed the biggest bankruptcy in history. What followed was the global financial crisis of 2008, big bank bailouts, deep and prolonged recession, car company rescues, soaring American joblessness and Europe’s sovereign-debt crisis.
Through these serial overlapping cataclysms Ms. Leroux proved herself a management black belt disguised as tinkerbell, steering Desjardins with sure and steady focus. Total revenues rose from $8 billion in 2008 to $13 billion in 2011. Assets on her watch grew from $152 billion to $190 billion. Pre-tax operating income soared to $2 billion from a scant $186 million in 2008 when Desjardins had to write off more than a billion dollars of debt acquired prior to her first term.
ICY brought Ms. Leroux to international prominence. She created the Summit of Cooperatives in Quebec City to show the world that co-operatives can work for both people and profit. It wasn’t going to be just another conference, she vowed, “It has to be not just good, but emotionally positive – there has to be a taste to come back.” In the event it drew thousands of participants to an extravaganza of Hilton light and sound in the ambiance of old Quebec that was universally judged a spectacular success. Monique Leroux and Dame Pauline made a joint presentation of a statement from the Quebec Summit to the U.N. at a ceremony in New York to conclude ICY. Costs estimated at $10 million were recovered to some extent from sponsorships and participation fees but a substantial deficit was covered by Desjardins.
It was evident that the Quebec Summit had a ring to it and could grow to mean something significant within the global cooperative movement. A successful second Summit had potential to develop into a Davos-like forum for co-ops in Quebec City, the historic birthplace of Canada and across the St. Lawrence River from Lévis, where the credit union movement had its start in North America in the late 19th century at the home of Alphonse Desjardins, founder of the company that bears his name.
The Davos allusion was advanced by Ms. Leroux herself who hasn’t forgotten where she comes from. Apart from numerous other public and co-op tasks, she sat on a council of the World Economic Forum (Davos by its official name), was a member of the Trilateral Commission and one of just two co-op CEOs on the Canadian Council of Chief Executives.
Despite the $1,700 entrance fee, let alone travel and hotel costs, the second Quebec Summit in October 2014 once again attracted 3,000 participants from over 90 countries. A Quebec Summit Declaration signed by Ms. Leroux and Dame Pauline was presented to the G20 Leaders’ Summit in November 2014. Close observers estimate the overall cost of this edition at $13 million. The extent of the shortfall, if any, is unknown outside Desjardins and the Summit board.
The third edition of the Quebec Summit, by then described in the literature as a “bi-annual event and a central organizing force in the international co-operative movement” was held October 11-13, 2016. More than one major co-op planned its AGM to coincide with the Summit, bringing directors along. It was another sellout, with “more than 3,000” participants from 113 countries, boosting awareness and providing a high level forum for cooperation globally among cooperators. Finding ways to work together is among the core principles of co-ops.
Monique Leroux was still front and centre. She was no longer CEO of Desjardins. After two terms in that office retirement is mandatory. But by remarkable coincidence her new job presented itself almost simultaneously. She was now president of ICA, replacing Dame Pauline, who had to resign in 2015 after The Co-operative Group ran into financial trouble and cut its support for her office. Ms. Leroux easily won an election to serve the remaining two years of Dame Pauline’s term. Desjardins would step up to fund its former chief in her new role.
However her new role, now based in Brussels where ICA has its headquarters, was complicated. Guy Cormier, a co-op lifer and her successor as CEO at Desjardins, signaled a different approach soon after taking over by dismissing a dozen vice presidents. Going forward with the Quebec Summit was not in his plan. Desjardins would be there for the Summit but not as primary organizer and sponsor.
This was not as big a setback as it might have been. By its third iteration in 2016 the Quebec Summit was doing better than break even. Costs had been contained while revenues were maintained. The Summit had won a reputation as a go-to event for the co-op establishment and an established client base. It had a functioning team under Stéphane Bertrand, profit in reserve and a lively prospect list. ICA was still an official sponsor. Monique Leroux was still in charge.
The hunt for a new co-sponsor for the 2018 Quebec Summit ranged far and wide. Major European co-ops, some in France much bigger than Desjardins, gave it a pass. For a while it appeared that Mohammed VI, King of Morocco (his family has run the country since 1631), was interested but in the end there was insufficient co-operative heft in the kingdom to support a summit, not to mention it would mean relocating from Quebec.
But it wasn’t long before the better alternative presented itself. When she took office at the Alliance there were already discussions underway for “an overarching solution that could bring together several co-operative initiatives.” Out of the Leadership Circle at ICA comprised of reps from bigger businesses came a proposal to create an International Co-operative Center (ICC) “from which to launch the co-operative business world to another level.”
She would champion the committee’s vision and add a critical component. To give it a push and substance from the start, ICC would embed the successful and by now self-sustaining Quebec Summit. ICC would “capitalize on the International Summit of Cooperative capabilities (tools, team, contacts…).” Moreover she knew just where such an international centre could be set up: in her home province of Quebec. Not Quebec City, where the Summit was held, but Montreal was the right place for the ICC, which would have a number of different activities and roles to advance B2B marketing among co-ops, syndicated research, a networking platform and programs. ICC would have global reach and speak to the interests of the Top 300 in the World Monitor and those that aspire to get there, including many of the 3,000 participants crowding the Quebec Summit every two years.
Even before the proposal was ready for the ICA board, she was pitching the concept at the highest levels. Connections were good enough that two-thirds of the $30 million in projected startup costs for the ICC was soon pledged by the provincial and federal governments. The timing wasn’t bad – Montreal was about to celebrate 375 years and feeling expansive. A grant of $5 million was under active negotiation with the city.
In June she took it to the board of CMC, the apex of Canadian co-ops. A director who was present says “CMC’s board did not have a lot of enthusiasm, I think because they thought that seeking resources for this centre would hurt the chances to obtain federal resources for co-op projects that were higher priority. . . [Nevertheless] the board decided eventually they would support it if . . . it was to be part of ICA’s new strategy.” Canadian co-ops would follow CMC’s lead. Rob Wesseling, CEO of The Co-operators Insurance company, who was a big supporter of the Quebec Summit for “creating opportunities for leadership in the sector,” says “we decided that the Canadian apex was the right place to get a decision” on ICC.
Not everybody would be so reluctant. Ms. Leroux would soon be able to report $1.5 million in confirmed commitments for ICC from “private partners, mostly co-ops”, with another $3 million “of declared interest.”
The Summit now was incorporated in the Center. Or was the Center a creation of the Summit? It wasn’t entirely clear. The draft 42-page business case for the ICC circulated September 11, 2017 has three logos on every page. One is for the Alliance and another for the Summit. The third identifies the primary author of the report, Ernst & Young, an active Summit participant from the start and one-time employer of its chief protagonist, Monique Leroux.
But where is she? To the surprise and consternation of the co-op world, she announced September 5 she “would not be putting my name forward again” for the ICA presidency, a decision she said she was making “for important personal and family reasons.” To say this was a shock to the system would be to understate it. Alongside Pauline Green she had helped launch a new age for co-ops with IYC. She had provided team members and support to produce the ICA Blueprint for a Co-operative Decade and the World Co-operative Monitor. She had created and sustained the Quebec Summit, which had become a signature global event.
Moreover, because she was filling in for Dame Pauline, she had completed only two years of a term that usually runs for four. It was universally assumed she would carry on with her own mandate, including ICC, a bright new star in the co-op constellation. Re-election was certain if she ran.
During her brief time at the helm she had scored in a handful of key areas: globalization, sustainable development, interco-operation, innovation and gender and youth equality and inclusion. In each catgory she could list a half dozen or more specific achievements or events that gained a yard if not a goal. On each list the 2016 Quebec Summit was featured
The ICA annual meeting is held in Malaysia in the fall of 2017. On November 13 the retiring board meets in Kuala Lumpur to hear an upbeat presentation about ICC from outgoing President Leroux, including reaffirmation that Canadian governments have committed more than $20 million to the project. On November 17 the incoming board meets with the new president, Ariel Guarco of Argentina. ICC is not mentioned. It’s a crippling blow.
Buried in the footnotes of the ICC proposal by E&Y is a caveat. “The Canadian Public funding comes with the following expectations: that the ICC is headquartered in Montreal and that a public announcement is made in November/early December 2017.”
There won’t be another ICA board meeting until January 2018. At that meeting there’s a lively discussion of ICC, much of it favourable, but for some new directors it’s the first they’ve seen of the proposal. Ariel Guarco suggests it be taken up again at the next meeting to give everyone time to read and reflect on the plan. Agreed. But it was too late for ICC. A month later she pulled the plug.
Monique Leroux had resigned but she wasn’t gone. How could she leave? The Quebec Summit was her invention. ICC was being developed and promoted by the Summit team she led, based in Montreal. Monique Leroux was involved in all of it, for better or for worse. It was going to be worse.
In a letter addressed to Ariel Guarco on February 27, 2018, she wrote, “I regret to inform you that we will not be going forward with the Center at this time.”
“Despite the will of the governments of Quebec and Canada and the city of Montreal to proceed,” not all the conditions for launch were in place.
And the Quebec Summit?
“You will appreciate that this [decision] . . . compromises future editions of the International Summit of Co-operatives since their funding was partly included in the financing” for the Center. In a follow-up letter March 5 she confirms that the Summit is no more. This is six months to the day after she quit. It’s over. The energy, passion, the tens of millions of dollars, the sponsors from all sectors, tens of thousands of participants from all nations, the visitor bonanza for Quebec City, the injection of unique co-op IP, networking, interco-operation, learning from world leaders, all gone. The Summit has committed suicide. Assisted.
In her resignation letter Sept. 5 she wrote, “Due to some very particular personal circumstances, I am forced to limit my activities outside Canada.”
Those very particular personal circumstances concerned her mother, who was in her mid-90s, hadn’t been well and was made anxious by her daughter’s frequent trips abroad (40 countries in three years). She gave up the job to cut back on travel to comfort her mother.
Did she have any inkling when she made this decision that all she had created and nurtured was going to implode as soon as she departed? She vehemently denies it, insisting until the day she stepped away that more than two-thirds the required start-up capital for ICC was committed.
But she also knew a large chunk of the commitment was time sensitive. The feds, for reasons inscrutable, required an announcement of ICC by early December at the latest. When the new board with a new president failed to take it up at its initial meeting in November, which was the last one in 2017, the writing was on the wall – going, going. After the January meeting when ICC was punted forward for more discussion, it was gone. And after all was said and done, that was the reason Monique Leroux gave for the collapse of the Center, carrying with it the Summit. The ICA did it in.
Her letter canceling the Center despite the will of governments to proceed, says “not all conditions for launch were in place.” But she specifies only one unmet condition: “a timely commitment by the International Cooperative Alliance” wasn’t forthcoming. An ICA official endorsement of the plan was essential. It would stiffen public funding for ICC and bring along laggards at the apex like CMC with their big co-op members, some of which dominate the provinces where they operate.
The chance to solidify that commitment fell between regimes over four days in November. The outgoing president failed to bring it to a vote. The incoming president failed to take it up in time. Left unsaid was that outgoing and incoming might have been seamless and the same had Monique Leroux wanted it so.
She makes appearances to distribute the remaining proceeds of the Summit, a couple of hundred thousand here, a few hundred thousand there. There was no Quebec Summit in 2018. But mirabile dictu, wonder to tell, it has $650,000 left over from prior years to be sprinkled among co-op projects deemed worthy.
Mostly though she tends these days to the business of a Montreal-based international wealth management firm that has rocketed from zero to handling $129 billion in less than fifteen years, where she’s a “special advisor,” and she chairs the board of directors at Investissement Québec, the province’s economic development agency.
When last I spoke with Ms. Leroux late in August she said her mother was feeling much better.