It's an established standard clause in tenancy agreements that the premises cannot be used for business purposes. This is nothing to do with preventing people from working. It's to protect residents from environmental hazards, danger from traffic and so on. Imagine some-one running a truck delivery business on your block, for example. Noise, petrol fumes, not being able to get your own car down the street...Having such a clause in domestic tenancy agreements was probably first implemented sometime in the past, when Government first started taking environmental health seriously and decided it was desirable for residential areas and business areas to be segregated.
There are also issues over the rating of the premises. A person using premises to run a business usually has to pay the business rate, which is higher than domestic council tax. Why should some-one get away with the cheaper domestic tax when they're really running a profit-making enterprise from the premises? You can see how the local authority would have an issue with this, they'd see it as an entrepreneur robbing them of revenue.
If your friend's is doing an office-based quiet type of business that wouldn't disturb any-one living near him, and especially if he's not going to earn a full wage from it for a while, he could simply start up without telling Cobalt - and make sure nobody who knows him or visits him can find out what he's doing, people have been known to snitch on each other!
If the business starts to take off after a year, he could then look for separate premises.
Otherwise, I can only suggest he looks for shared business space with another small business and splits the cost. Though I expect he's already thought of that.

Cobalt's refusal won't be anything to do with tenants getting enough money to be able to exercise the right to buy. With most charitable housing associations, the tenants don't have the right to buy. That usually only comes with a council tenancy. Housing association tenants used to be able to get a grant from the government, the amount depending on the length of their tenancy, to be able to put a down payment on a house for sale on the open market. But I think that scheme ended some time ago.

Lets face it - it's a scam and the board of directors and mouthpieces, are on a good little gig. Plenty of gelt in that game. Say no more.

It takes proper housing with rights off the working classes.

As for a business from home, it depends what it is. Why should the rules state that disabled people and others are prevented from being valued members of society?

Much work today is digitalised. So lets not start throwing the rule book around when work is changing and could mean your neighbour tapping on a keyboard - not starting up a lathe and a grinder.

I'll bet Cobalt workers work from home sometimes. In fact the directors just sit at home don't they?

How much are they on we might ask?

Cobalt would have kicked out John Lennon and ASBO'd Ringo with his drums.

Cobalt mainly want people on unemployment benefit, low wage. Build up some Americanised ghetto - fill it up - sit back, and count the coins.

Greed.

Pure greed.

I hope the tenant finds a way.

I hope Cobalt and all the rest of these wicked profiteers are stripped of the assets.

Good luck to the unemployed lad.

Carol Laidlaw is wrong on several counts:

The Right to buy and the Right to aquire:
 http://www.liverpool.gov.uk/Housing/Council_housing/Right_to_buy/index.asp

you should investigate those rights there. Which does actually give back force to the original argument. Are Cobalt seeking to deprive people of opportunity? It would fit a pattern.

Working from home is not considered a nuisance by Cobalt: The Board of Cobalt have all worked from home, now and again. It counts as working from home if you answer the phone to your work colleagues. Or you do a bit of paperwork. There are lots of ways of working from Home. If you are interested in the extent of home working, you can find out more from the Office of National Statistics. They believe that up to 40% opf people work at home at one time or another for a few hours. The Board of Cobalt have all worked from home rather than going to the office. Why are they permitted that right when tenants are not?

It is only asking for equal treatment and equality of opportunity. Which, if you read their marketing material, is one of their commitments. Promoting equal opportunities is a commitment but discrimination is against the law. Such unequal treatment between Directors and Tenants in a charity is serious concern. Once which might be voiced to the Charity Commission. Why? Because the commitments Cobalt make are part of their charitable remit.

I am not wrong, and if you read the link you have helpfully provided, you will see this. Housing Association Tenants do not have an automatic right to buy. It is also stretching credibility too far to say that housing associations are all in a conspiracy to prevent their tenants from working, in order to prevent them from exercising the right to buy.
Your other comment, on working from home, confirms my opinion: if you're carrying out the kind of business that doesn't annoy the neighbours, your landlord is not going to know you're breaking your tenancy agreement. What they don't know, they can't object to. The clause in tenancy agreements mainly applies to the kind of businesses that would cause a nuisance in residential areas, or the kind of fully functioning business that has to be registered with Companies House.
Also note, I have not expressed any opinion about the politics, functioning, or general motivation of housing associations. This implies nothing about what my opinion of them is. Since I'm using my real name, I'd simply rather not comment on a public forum.

my friend happens to be a tenant that was his mums.he's lived there befor Cobalt.