Co-operatives and mutuals may hold key to greater economic inclusion for indigenous Australians

09 December 2021

• Indigenous business “a sleeping giant”
• Co-ops and mutuals model best suited to indigenous business ownership

The business model behind Australia’s $35 billion co-operatives and mutuals sector should be considered as a blueprint for the social and economic empowerment of indigenous communities, according to a report released today.

The report’s authors, who include Pastor Ray Minniecon, describe indigenous business as “a sleeping giant” and make a number of recommendations to improve access to economic participation by indigenous people.

While different forms of business structures should be encouraged, the idea of ‘shared ownership’, such as those found in co-ops and mutuals, are most closely aligned to the culture and aspirations of Australia’s First Nations people.

The report, Doing Business Together, is the result of a major research project looking at the inclusion of Aboriginal and Torres Strait Islander people in the sector. It was issued by the Business Council of Co-operatives and Mutuals (BCCM), the peak industry body for Australia’s co-operatives and mutuals sector.

“There has been a lot of energy spent by governments over the years thinking about how to empower indigenous people in business,” BCCM chief executive Melina Morrison said. “Our report says it’s time for them to pick this business model up again.

“Co-ops are a business model based around the idea of democratic ownership and control by the people who use the business, or the customers of the business. We have a strategy to allow aboriginal enterprises to achieve scale without exchanging their ownership or influence for capital.”

The BCCM report comes days after the Indigenous Australians Minister, Ken Wyatt outlined a national plan for indigenous skills, jobs and wealth creation, centred around greater inclusion by Australia’s ASX 200 listed business.

Ms Morrison said the co-ops and mutuals model deserved greater consideration as a preferred model for indigenous business.

“We have to be careful that whatever strategies we come up with provide indigenous people with models that allow them to take the whole community with them and not just those at the top,” she said. “The co-ops model is a more inclusive strategy to ensure more people benefit from the enterprise over time, free from the tension between shareholder benefit and stakeholder benefit that plagues listed entities.”

Ms Morrison said the BCCM would work with indigenous businesses over the next 2-3 years to create a pathway for greater participation in co-ops and mutuals.

Australia currently has 222 indigenous owned and controlled co-operatives and mutuals with a combined turnover of $1.3 billion. These are mostly involved in the provision of cultural, health and human services but the report notes there is an opportunity for “significant growth in indigenous co-ops and mutuals”.

The report says indigenous community owned co-ops are:

• Motivated to achieve income and opportunity not only for themselves, but for their community.
• Able to generate significant social capital as well as private capital.
• Positioned to act as a tool for effective social empowerment and self-determination

“Perhaps out of this pandemic, co-operatives will give new meaning, new opportunities, new aspirations and new goals for our companies, our people, our communities and our nation,” Pastor Minniecon, indigenous leader and director of Bunji Consultancies, said in the report.

The report found that Australia’s co-ops and mutuals sector had a major role to play in assisting the growth of indigenous co-ops and while the adoption of Reconciliation Action Plans was critical, the sector could do more.

Key recommendations include:

• that co-ops and mutuals be encouraged to identify indigenous co-ops within their supply chains and target these organisations for procurement
• the development of an indigenous specific, culturally aware co-op business hub

“In turning the mirror back on ourselves and looking at how inclusive we are, we found that the co-ops business model is unrecognised as being a good model for indigenous empowerment, perhaps even the best given it is culturally aligned as well,” Ms Morrison said.

“We need to understand the challenges and barriers faced by indigenous people to grow their business.  Procurement is an obvious way we can assist but there is a role for the sector to play in educating them about the business model.”

More information

• Download and read the Doing Business Together report
• Listen to interview on ABC RN Breakfast: Push for big business to boost Indigenous employment
• Browse the report launch photo gallery