MOSL revisits retail market membership shake-up

MOSL is consulting until 1 July on revised proposals to change its membership arrangements. It reasoned that its current structure is “no longer representative of the evolving market, either in terms of the membership categories or the composition of industry directors on the MOSL board” and that existing quorum arrangements can be onerous to meet.

At present, MOSL members – non-household market wholesalers and retailers – operate for voting purposes in three equal blocks:

• Wholesalers (33%) – nine of the 25 are New Appointments and Variations

• Unassociated retailers (33%) – 17 of the 29 are self suppliers

• Associated retailers (33%) – six in total.

Voting is required for purposes including to approve MOSL’s annual business plan/budget/annual report, to reappoint statutory auditors, and to make changes to the Articles of Association. A ‘one member one vote’ system operates whereby, for instance, a retailer with single supply point has same voting power as a major wholesaler supplying many thousands of customers.

Quorum and minimum voting levels must be met for each of the three blocks. There is a high quorum requirement of two-thirds for each category of member; if insufficient numbers of members in any one category fail to vote, the whole will fail.

Members are also able to nominate and vote for elected industry directors on the MOSL board to represent their member category.

MOSL attempted to change its Articles of Association and membership arrangements in 2022, but this stalled due to opposition. It has now proposed revised “potential solutions” which it is seeking trading party feedback on – including to welcome suggestions for alternative solutions – by 1 July. A proposed solution will then be put to members in summer, and will require 75% support to pass under the current rules. 

The potential solutions include: 

• Membership: merge the ‘Associated Retailers’ and ‘Unassociated Retailers’ into one ‘Retailer’ category, in line with the arrangements for the Strategic Panel and its committees. MOSL reasoned that associated retailer numbers are now small, have disproportionate representation, and shared interests with unassociated retailers.

• Industry directors: The current three industry directors appointed to the MOSL board would be increased to four – two wholesalers and two retailers. This would bring better balance. Whereas the three directors are currently elected by those in their block, this would change so the blocks continue to nominate candidates, but the final selection will be made by MOSL’s Nominations Committee. MOSL said this would bring the MOSL board in line with the Strategic Panel, Code Change Committee and other industry groups.

• Quorum: Reduce the number of votes required to meet quorum to 50% of all members (across both new categories), with an additional protection in place to ensure that a vote is only passed where 50% or more of the votes by both the wholesaler and retailer categories are in favour. With the current two-thirds per block quorum requirement, it can be a struggle to secure participation. 

• Triennial review of membership: this is a new proposal for a formal requirement in the Articles of Association for MOSL to review its membership structure every three years, “to remain aligned to the evolving market”. 

• Finally, there is a linked code change proposal (CPM059) to remove duplication with the Articles of Association relating to MOSL’s membership from the Markets Arrangement Code.