The co-operative movement owes its principles to its founders, the Rochdale Pioneers, a group of working people who got together to enable fellow workers to buy food at prices they could afford. Their vision was enshrined in the Rochdale Principles.

There were once hundreds of independent co-operative societies. Most have merged to form The Co-operative Group. There are still a few independent societies. Of these, a few still operate an independent funeral service and some of them, like Scotmid in Edinburgh, are brilliant. All co-ops proclaim high ethical standards.

Given the economies of scale enjoyed by Funeralcare, and having in mind its foundational principles, you might expect it, as the people’s undertaker, to provide the cheapest funerals out there. It doesn’t. Its average charge for a funeral is higher than that charged by many independent firms, often by between £500 and £1000. You would think that, in an age of funeral poverty when increasing numbers of people are finding it harder and harder to find the price of a funeral, Funeralcare would the standard-bearer for affordable funerals. It isn’t.

It offers good training and it pays good wages by funeral sector standards. It has some first-class people working for it.

And it’s profitable. So where does all the money go? Propping up the rest of the Co-op Group? Who knows?

Funeralcare has a reputation for sloppiness and scandal within the funeral industry, whose competitors sometimes refer to it as the Cock-up. To be sure, it has made its fair share of mistakes, and these are recorded on the Good Funeral Guide website. The good news is that the frequency of these is declining, though we receive more complaints about Funeralcare than anyone else. Funeralcare has in the past been characterised by disenchanted funeral workers. Levels of dissatisfaction seem to be falling.

Of greatest concern to many of its potential clients is its derecognition of the GMB trade union, earning it a ban from the Glastonbury Festival and the Tolpuddle Martyrs Festival, and the condemnation of the TUC. One can only speculate on what the Rochdale Pioneers would have thought of that.

We don’t think Co-operative Funeralcare is wicked but we do think it’s lost its focus. Edgar Parnell, former chief executive of the Plunkett Foundation, offers this analysis which we think helpful in understanding where it all went so wrong for The Co-operative Group.

The management of the Co-operative Group appear to believe that they are running a conventional business with the aim of profit maximization that just happens to be owned by members rather than by investors. Whereas they need to be clear that the function of all co-operatives and mutuals is to intervene within the marketplace in the best interests of their members. The Group’s management either do not fully understand, or choose not to adhere to, the underlying essentials of the model of enterprise required for any form of co-operative or mutual to be successful.

Chasing growth to the detriment of the real interests of the membership has proved to be the downfall of major consumer co-ops in many countries in Europe. Executives often seek to pursue a growth strategy because it means a bigger empire, more status and higher pay for them. The correct response to expansion proposals, including merger proposals, should always be to focus upon what is best for the membership and most likely to result in the achievement of the purpose of the enterprise. When co-operatives grow in terms of the number of members and/or turnover, they are frequently beset by multiple problems. They lose sight of their original purpose, are prone to switch towards serving the interests of senior executives or cliques rather than those of the bulk of their members. As a consequence, they come to be regarded as irrelevant to the lives of their members and in the worst case they are hijacked by self-interested groups.