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Comment by marbletiles | Hacker News Reader

I’m not following your logic. The co-op is designed for everyone to care _more_ because they are part-owners and because the organisation is set up for a larger good than simple profit-making.

In practice the distinction has long been lost both for employees and members (customers), but the intent of the organisational structure was not for nobody to care; quite the opposite

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But there are millions of part-owners. Every “member” of co-op (i.e. a customer in the same membership program that just lost all their data to this hack) is an owner of it. Maybe the employees get more “shares” but it’s not at all significant.

And at the executive governance level, there are a few dozen directors.

There is a CEO who makes £750k a year, so it has elements of traditional governance. I’m not saying the structure is entirely to blame for the slow reaction to the hack, or that there is zero accountability, but it’s certainly interesting to see the lack of urgency to restore business continuity.

My family used to own a local market, and as my dad said when I told him this story, “my father would have been on the farm killing the chickens himself if that’s what he had to do to ensure he had inventory to sell his customers.”

You simply won’t get that level of accountability in an organization with thousands of stakeholders. And a traditional for-profit corporation will have the same problems, but it will also have a stock price that starts tanking after half a quarter of empty shelves. The co-op is missing that sort of accountability mechanism.

Responsibility diluted to the point of no actual responsibility?

Exactly, the bystander effect. But it’s not strictly due to the large size. Other big companies get hacked too. But if they have a stock price then there’s an obvious metric to indicate when the CEO needs to be fired. It’s the dilution of responsibility combined with a lack of measurable accountability that causes the dysfunction.

The problem is that cutting IT and similar functions to the bone is really good for CEOs. It juices the profits in the short/mid term, the stock price goes up because investors just see line go up, money goes in, and the CEO gets plaudits. There's only one figure of merit: stock price. What you measure is what you get.

It's only much later that the wheels fall off and it all goes to hell. The hack isn't a result of the CEOs actions this quarter, it's years and years of cumulative stock price optimisation for which the CEO was rewarded.

And you can't even blame all the investors because many will be diluted and mixed though funds and pensions. Is Muriel to blame because her private pension, which everyone told her is good and responsible financial planning, invested in Co-Operative Group on the back of strong growth and "business optimisation intiatives"? Is she supposed to call up Legal and General and say "look I know 2% of my pension is invested in Co-Op Group Ltd and it's doing well, and yes I'm with you guys because you have good returns, but I'm concerned their supermarket division is outsourcing their IT too much, could you please reduce my returns for the next few years and invest in companies that make less money by doing the IT more correctly?"

The incentives are fucked from end to end.

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