New Zealand imposed strict restrictions and lockdowns due to COVID-19. How did these impact cooperatives?

In New Zealand, a wide range of industries like agriculture, horticulture, health, financial services, retail, construction, and tourism utilise the cooperative business model. These businesses generate 18% of New Zealand’s GDP and are a combination of large scale exporters and providers of products and services to the domestic market.

When the first lockdown was announced, there was a lot of uncertainty about who would be able to continue operating or who was necessary to enable New Zealand to continue supporting the domestic economy. The government quickly confirmed that businesses classified as essential services could continue operating as long as they followed appropriate protocols to protect their staff.

As with our international counterparts, the issues we faced and continue to, are around our supply chain - getting products to international markets. In terms of the supply chain, New Zealand is probably one of the worst impacted due to our isolated location at the bottom of the world. This is going to be an ongoing issue for us with not enough containers or ships to support the imports/ exports of products which we are so reliant upon. There are stories of on-time delivery being reduced to 35% and the cost of containers and airfreight having increased between 3  to 10 fold.

With our borders shut, we are struggling to get access to seasonal workers in backpackers to support our agricultural and horticultural sectors during their peak season.  It’s been quite challenging for such organisations. The continuing uncertainty is leaving many of our members to deal with managing multiple unknowns. We are anticipating a downstream impact on mental health and wellbeing as people are impacted with the increased hours they are putting in, the ongoing financial uncertainty and increasing cost of goods.

Housing in New Zealand is one of the costliest as compared to other OECD countries. During the pandemic, it has grown exponentially as a lot of people have come back home. It continues to grow even with several measures taken by our Reserve Bank.

Right now we've managed well, but the reality is what's coming down the pipeline is unknown.  I think we're probably going to lose a lot of our skilled talent to offshore again; that could come full circle.

How did Cooperatives Business New Zealand (CBNZ) respond to COVID-19?

At the time of the announcement that New Zealand is going into lockdown, there was a lot of confusion and uncertainty for us as well.

I remember packing up our offices in a few hours and trying to work out how to get myself to working remotely, ensuring the team was okay and had access to equipment. But more important was how they were coping with their own and family’s needs.

Many people were buying products from the supermarket. All sporting gear disappeared from the shelves as people realised they may not be able to access gymnasiums. Foodstuffs North Island and South Island are some of our largest members who operate over 50% of New Zealand’s supermarkets. The shelves were being emptied before they could get the stock.

We, at CBNZ, stepped into the role of providing a stream of information to our members on:

• Who was able to operate
• Where to find information
• How to put in place appropriate protocols and communicate with staff around expectations
• Rent relief
• Access to wage subsidies

A few of our members in the retail space did not survive which was very distressing for their members, leadership teams and staff. We did whatever we could to assist them during this period. For those who were able to put their businesses on hiatus, we reached out to other members to take on their staff and use their facilities. For these members, we waived their fees and focused on supporting them to remain viable.

With the borders shut to seasonal workers from Pacific countries and no backpackers entering the country, many of our horticulture and agriculture members were short-staffed. We lobbied with Ministers and they were quite interested in having conversations and later got involved. This led to many incremental changes - migrant workers being able to remain in New Zealand, an extension of tourist visas and entry by a smaller number than what we would usually have during the peak of seasonal workers. Funnily enough, we’d facilitated an industry forum for our horticulture members before lockdown where we discussed opportunities to rotate seasonal workers.

Over this period, the spirit of collaboration was evident across our members.

How did cooperative values and principles strengthen cooperatives to cope with COVID-19?

What was apparent was the focus on the 6th and 7th Rochdale principles – Cooperation among Cooperatives and Concern for Community.

Cooperation among cooperatives was evident in how our members assisted each other with staff, transport, and sharing of information. In terms of concern for the community, a number of our larger cooperative members gave significant funds to their members to support them through this challenging period. The food retailers really upped their efforts to provide food for those in need.

What are CBNZ’s strategies to Rebuild Better Together?

Strategies around building back better together are something that CBNZ’s Boards has informally considered as part of our overall strategy.

It has become apparent from the impact of Covid that there has been a seismic shift in people’s attitudes towards the large capitalistic corporates focused on maximising profit for their shareholders, and on the need to change behaviour towards climate change.

At our recent Leaders Forum held in May, the theme was Capital and Climate. There is recognition for the need to ensure the sustainability of businesses. This requires investment into technology and people to keep them competitive. In addition, the need to look at how they can respond to the target of Zero Carbon.

65% of our members are in the agricultural industry and playing a significant role in New Zealand’s GDP. The members focus on ESG (environment, social and governance) requirements for their businesses have been highlighted. On the governance part, we've done a lot of work to support our members to upskill their directors to be effective in their roles. The focus on moving towards B Corp certification was raised and it seems to be becoming more like a ticket item for cooperatives to say that we're good cooperative citizens. I wonder if there's an opportunity for the ICA to look at certification, so that, instead of all our members having to go out and get the B Corp certification, which costs them a fortune, it can be just said, we're a coop and we adhere to values and principles.

What becomes more apparent here in New Zealand and from what I gather from my international counterparts as well, is there is a lot to be done to enable a better understanding of the opportunities presented by the cooperative business model. It has the potential to improve the lives and livelihoods of so many.

COVID-19 has exacerbated the divide between the have and have nots. Some are identifying opportunities to generate significant profits from the challenges it presents, while others on the lower strata of communities are struggling from the detrimental impact We see an opportunity for CBNZ to work alongside these communities - Maori and Pacifica, to establish cooperative businesses to support them and their future generations to be part of long-term sustainable businesses.

I believe the coop model provides opportunities here in New Zealand to support rebuilding communities and businesses. Struggling businesses and individuals may look to collaborate and form cooperatives, i.e. in the Tourism sector, as we navigate this period of adversity. CBNZ is here to assist them to look at the potential to leverage the model.

Education is key to enable change. We need individuals to appreciate the opportunity the model presents and how it can be utilised to support New Zealand to rebuild the economy post COVID-19.