Building Wealth through Cooperatives Societies

25 Nov 2011

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 NLC President, Comrade Abdulwahed Omar

In recent times, many middle class consumers have resorted to cooperative societies as a means of solving immediate needs. One of such societies, the Nigerian National Petroleum Corporation (NNPC) Cooperative in Lagos, has continued to use the initiative to create wealth; Raheem Akingbolu reports

Under-utilisation of Staff Cooperative
Pioneers of staff cooperatives see it as a vital avenue for building wealth.
But as a result of lack of good managerial skill on the part of many proponents, it is from time to time grossly under-utilised. It therefore becomes difficult to transform it into thriving enterprises at all levels.

Another challenge being faced by those who believe in it lies in the inadequacy of capital and lack of vision, which prevent most members from taking advantage of the enormous potential inherent in it to build a sustainable business.
Despite these odds, the Nigerian National Petroleum Corporation (NNPC) Staff Cooperative Multipurpose Society Lagos seems to be forging ahead if its recent achievement is anything to go by.

By learning the necessary lessons, the executive committee of the society was able to overcome various challenges and grow it a position, through which it can impact on members.

For instance, following his election as president in August 2009, Mallam Isiaku Abdullahi, who headed the then new management implemented five initiatives, which propelled the society to a turnover of N10 billion.

A recent statement issued by the society enumerated that building sustainable wealth has remained a big challenge for most salaried workers in Nigeria today, given the challenges of meeting school fees, medical bills, feeding, and clothing expenses and desire to own a home.

The statement indicated that in most developed countries, access to credit is easy while mortgages are available to ensure that salaried workers can acquire their own individual homes.

“The staff co-operative multipurpose societies in most organisations are formed to bridge this gap and help members have access to credit to acquire the basic necessities of life and to improve their standard of living. In Nigeria, popular cooperatives include NNPC cooperatives, Shell cooperatives, Total and Exxon Mobil, to mention a few,” it added.

Root of the Matter
According to a brochure made available to THISDAY, the NNPC Staff Cooperative Multipurpose Society Lagos first commenced operation in CMS Lagos on the 9th of March 1992 as a simple staff cooperative multipurpose society with the overall objective of promoting the economic interests/well being of members.

The cooperative started with the primary objective of providing credit facilities to members at fair and reasonable rates of interest for provident and productive purposes and to encourage regular savings amongst members, so that each member may cultivate the habit of making savings, with a view to building up funds for their individual future use.

Although not without its challenges, the cooperative grew in leaps and bounds, over time. With a large number of enlightened and well educated members, the Lagos NNPC Multipurpose Cooperative society today has the largest membership in the NNPC family with over 6,000 members drawn from Department of Petroleum Resources (DPR); PTDF, OK LNG, Brass LNG and NLNG Bonny.

Effective Changes

According to Abdullahi, in order to take advantage of its size and pool of resources, the new management moved to raise the status of the cooperative society from its credit thrift nature to that of a multipurpose society.

“With its new status, the cooperative extended its objectives to include the acquisition of land for sale or development for housing or industrial purposes for the benefit of members and non-members alike as occasion may warrant; acquiring stock of shares and other rewarding ventures,” he said.

Ultimately, the president’s ambition was to convert the cooperative to a microfinance bank under the new micro finance policy of the Federal Government. It would be noted that one of the most vibrant microfinance bank in Nigeria is the Nigerian Police MFM, which transformed from a cooperative.

Building Managerial Capability
Generally, a study of the operation of most cooperative societies in this part of the world has revealed that most of them do not function efficiently due to lack of managerial talent. This is because the members or their elected representatives are usually not experienced enough to manage the society.

Another challenge facing cooperatives is the difficulty in getting people to buy into the new initiatives, especially the secretariat staff that, in most cases, lack the capacity to cope with the increased activities.

Under Abdullahi, this was also identified, but the body quickly initiated and executed plans to restructure and retrain the staff of the society to fit into the new brand, starting with the organisation of the Lagos secretariat.
Speaking on the development; he noted that, “The society’s secretariat was moved to its office in Adeyemi Lawson Street, Ikoyi, a corporate office, which represents the new Lagos NNPC Cooperative. A consultant was also engaged to recruit competent hands to manage the day- to-day running of the Society.

“Staff members were also trained locally and abroad. In order to bring services closer to members, management also opened liaison offices in Warri, Port Harcourt, Effurun, Benin, Kaduna, Mosimi for improved service delivery,” he said.
He also disclosed that the society developed a functional website that can be accessed at anytime and anywhere by anybody interested in the society’s activities and programmes.

He added that the management also computerised the society’s operations with a software known as CoopMan Financial Solution, which is online real-time and also linked directly to the society's website.

On training, he said the management organised investment training and exhibitions for staff to learn directly from financial services providers, investment strategists, product and value adding services from financial experts

Tags: Business, Cooperatives Societies, Nigeria, WEALTH

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  • It is an avenue to build wealth and creating a better future if there is transparency and sincerity among the society i consider it as the best option for the middle class and low income earner.

    From: Olow Azeez

    Posted: 4 years ago

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