Case Studies of Organisational Resilience in the Co-operative Business Model
- Elgar original reference
Edited by Tim Mazzarol, Sophie Reboud, Elena Mamouni Limnios and Delwyn Clark
Chapter 4: Irish agricultural co-operative modelling and remodelling: responding to a dynamic business and policy environment
The agricultural business and policy environment in Ireland has shifted considerably in recent decades, particularly in the context of the introduction in 1984, and proposed abolition by 2015, of the EU milk quota system. The milk quota system allocated a national milk quota in each EU member country together with individual quotas for milk producers. This means that if a producer produces more than his or her allocated quota, a super-levy (or fine) may be payable. The imposition of milk quotas was a powerful impetus for agricultural co-operative remodelling in Ireland in the mid-1980s and early 1990s, together with other factors such as a high proportion of 'dry' shareholders (non-user shareholders) and failure to distribute profits according to use, with a consequent high proportion of unallocated equity capital. This, in turn, led to reluctance on the part of the farmer shareholders to invest in the growth of the co-operative. Many of the larger co-operatives at that time moved towards a Public Limited Company (PLC) structure. The PLC structure involved the exchange of the bulk of the co-operative assets for a majority shareholding in a newly created investor-owned firm (Jacobson and O'Leary 1990). The PLC structure was and still is used as a vehicle to raise finance through the stock markets. The co-operative ownership in the PLCs has gradually declined over time, resulting in a significant reduction in the control of the co-operative shareholders in their business.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.