This paper examines the demutualisation of the British building societies, the trend during the 1990s for these mutual financial institutions run on behalf of their members and without external shareholders to convert to public limited companies. Demutualisation resulted from cultural change within senior management in mutual societies, which undermined their support for the idea of mutual ownership. This cultural change was a consequence of the deeper integration of mutual societies into the retail financial services sector where a different business culture was dominant. Though government has ignored the wider social impact of demutualisation, it has in fact undermined their attempts to encourage more socially inclusive forms of delivery for personal financial services. The paper makes a case for recognition of the contribution of mutual building societies to the development of more socially responsible corporate strategies. The recent wave of demutuahsations also highlights the need for mutuals to encourage greater membership involvement in the running of the organisation.
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