1. Publicly-traded and cooperative
entities within the same group
Eric Lamarque
Professor at the Université de Bordeaux’s Business School
(IAE)
Director of the Financial Institution Management Chair

2. Have we always asked the question correctly?
Haven’t we gotten a bit ahead of ourselves?
Do cooperatives have to use the same strategies as corporations?
People have lost sense of what a cooperative is: cooperatives are
formed so individuals can get more from the market or do better
than they could on their own
Is it in a cooperative’s nature to go international? To merge? Is
the “ bigger is better” mentality the only option? Do cooperatives
have to play the classic competition game?

3. Have we always asked the question
correctly?
Haven’t we gotten a bit ahead of ourselves?
Herd behaviour of certain leaders: if another cooperative
gets external funding, why not me?
Arrogance of certain leaders: prove that they’re as good as
other leaders

4. How?

5. How?
However, we've envisioned all of the other traditional
routes, including IPOs, without considering how access to
external funding, particularly the stock market, could impact
governance.
Why did some cooperatives go to the effort of giving up their
status to do this?

6. Impacts
Confrontation between two radically different cultures
Some cooperatives have found themselves with classic investors
who hold a minority share of the capital in their publicly-traded
entity. They often felt like their best interests and their opinions
were not taken into account when it came to strategic decisions.
The greater the float, the greater their attitude impacts the price.
The question then becomes: what is the shareholder-
cooperative’s attitude?

7. Impacts
Tensions between the central entity or the publicly-traded
subsidiary, heightened by the regional cooperatives’ sense
that priority was being given to the markets and that they
had strayed too far away from their membership
Since the financial crisis, we have witnessed regional
entities take their revenge and regain the upper hand in
terms of governance

8. Impacts
 Negative effects of creating a hybrid: member-shareholders
The overwhelming majority of members bought shares – trust
played a huge role
When prices dropped, the trust they had placed in the operation was
replaced by an equal amount of disappointment
It also became clear that there were few true member-cooperators
at heart. A financial argument was made to sell members’ shares,
like stocks, at a profit
The entire business argument for finding new members has had to
be reviewed these past two years