Co-operative and Mutual Enterprises (CMEs) contribute billions to the Australian economy and play a vital and quantifiable role locally and internationally, shows new report
Posted June 23, 2021
In 2019-20, co-operative and mutual enterprises (CMEs) contributed a whopping $90 billion towards Australian incomes, $20 billion towards Australia’s GDP and 180,000 full-time equivalent jobs reveals the new National Mutual Economy Report.
This is the eighth annual report on the scale and performance of the Australian co-operative and mutual sector released by the Business Council of Co-operatives and Mutuals (BCCM). The report maps the size, composition and overall health of the sector using the Australian Co-operative and Mutual Enterprise Index – a research project by the University of Western Australia, supported by SGS Economics and Planning (SGS).
The CME sector’s direct and indirect benefits are far-reaching
CMEs are member-owned businesses that exist to provide value to members across a wide range of industries from agriculture, banking and health insurance.
The CME sector’s economic contributions were measured the ‘direct’ contributions generated by each of the CME themselves, as well as the ‘indirect’ contributions that each CME supports domestically such as purchasing Australian sourced assets, good and services and distributing local profits to Australian residents said SGS CEO, Alison Holloway.
For the first time, SGS has come on board as a research partner for this report. Using input-output modelling, and survey responses from across the CME sector, we estimated the CME sector’s total direct and indirect economic contributions, and they’re impressive.
In a year marred by natural disasters and the onset of the COVID-19 pandemic heralding a halt to international trade and global recession, the direct and indirect benefits of CME businesses were far-reaching:
- The CME sector generated 1 per cent of Australia’s GDP and comprised nearly 1.5 per cent of the nation’s employment, excluding member-owned super funds.
- The total revenue for the top 100 co-operative and mutual enterprises, or CMEs, was $32.8bn.
- Australian CMEs combined gross assets of more than $1.1 trillion, including super funds.
- CMEs directly employed at least 70,000 Australian workers but facilitated the employment of 180,000 people.
- In agriculture alone, CMEs facilitated the operations of more than 24,000 member businesses.
Northern Rivers the unofficial co-op capital of Australia
The Northern Rivers region in NSW, a well-known destination for Hollywood heavyweights and celebrities, has become the unofficial co-op capital of Australia.
Northern Rivers is one of Australia’s most economically diverse and deeply connected regions. SGS analysis shows this buzzing co-operative capital – leading the way as a food provenance region by delivering produce from paddock to plate – contributed an impressive:
- $2.4 billion to the regional economy through its extensive network of co-operative businesses and people
- $308 million towards the gross regional product (GRP), and
- 11,568 full-time equivalent jobs across the regions.
What stands out is the Northern Rivers region, which we found contributed an impressive $2.4 billion to the regional economy through its extensive network of businesses and people in the co-op sector. Co-operatives have driven the revival and survival of the region but lots of people collaborate in different ways, which means the impacts are far-reaching. This is about co-operative economic contribution to the national regional economy through shared innovation and business solutions – their cooperation is an advantage to the local economy.
Post COVID-19, Australia's economy will need more CMEs
CMEs provide employment and work opportunities to 280 million people across the globe – 10 per cent of the world’s employed population* Unlike the traditional investor-owned companies, which exist to maximise shareholder returns, CMEs focus on the social, economic and cultural needs of members. Good corporate citizenship is not a cost for CMEs but is a member dividend.
More and more, government, investors and the public are recognising the price of short-sighted priorities and are seeking the more sustainable CME business model. These are businesses that persevere through a crisis, move forward together and drive change said Melina Morrison, Chief Executive of the Business Council of Co-Operatives and Mutuals.
In a crisis you really see the co-operative ethos get amplified and it truly pays dividends, as this report so clearly shows. Post COVID, our country needs more cooperatives to make sure more Australians benefit from our nation’s economic recovery and reap the rewards.
Each year we produce this report because it’s sorely needed – we’re the only non-government organisation doing this very important job of showing Australians and government why this sector is crucial to our country’s economic recovery.