22 April 2014
Governance failures have been blamed for Co-op Group’s total losses, which have come to a staggering £2.5 billion, as announced in their annual report.
Interim group chief executive of the Co-operative Group, Richard Pennycook said the results highlighted ‘fundamental failings in management and governance at the Group over many years’ and should be seen as a wake-up call for anyone doubting ‘just how serious the challenges [the Group] face are’.
The Group’s biggest loss came in at £2.1 billion due to discontinued operations, which consisted of the Co-op Bank’s trading loss up to the date of disposal of £1.44bn and £625m with regard to the loss on disposal of the Bank.
The Group also made an operating loss of £148 million in 2013, in comparison to 2012, when it made an operating profit of £142 million.
Chair of the Co-operative Group, Ursula Lidbetter, said: ‘During 2013, it became apparent that our governance had fallen far short of the standards to which we aspire as a co-operative society. Now is the time to put that right through fundamental reform – we have to act with urgency if we are to lay the foundations for a stronger, healthier co-operative business in the future.’