- Hispanic Resources
Serving on a board is much different now than in the past.
Increased competition in the financial services industry, a growing compliance burden, and examiners’ education standards have brought new duties and responsibilities for credit union directors, Jeff Rendel, CEO of Rising Above Enterprises, said during CUNA’s Community Credit Union and Growth Conference in San Francisco.
But what hasn’t changed is directors' original intent: to represent member-owners.
To ensure your board is 100% engaged in this mission, Rendel says credit unions should consider these governance conventions and expectations:
1. All eyes are on the board. Corporate governance has been a hot topic this decade, culminating with the breakdowns on Wall Street during the financial crisis. Regulators, members, and all stakeholders are paying very close attention to your governance oversight.
Stakeholders want assurances that boards are safeguarding their investments in the success and ongoing viability of their credit unions.
Create a Progessive, Engaged Board
To evaluate your governance culture, consider these attitudes and values of a high-performance team, advises Jeff Rendel, CEO of Rising Above Enterprises:
2. Participation from day one. Since the Sarbanes-Oxley Act of 2002, vibrant contribution has become a condition of accepting nomination and election to the board. Regardless of tenure, all board members are equal in their voting power and expected contributions.
3. The exchange of ideas is the livelihood of boards. Boards that actively discuss strategy, results, and direction make certain the progress of their credit union primarily benefits the long-term interests of stakeholders. Expect lively contributions from directors to all board deliberations and decisions.
4. All directors need to be heard. While the board chairman may call board meetings to order, ask for votes, and adjourn proceedings, all directors should take a dynamic role in meetings. The board chair should query quiet board members about their thoughts and opinions, and keep all directors focused on strategy.
The board chair also may appoint a director to lead and facilitate conversations during the board meeting.
5. Reciprocal relationship with the CEO. While boards hire CEOs to lead and manage credit unions, CEOs rely on boards for direction as much as boards rely on CEOs for execution. Boards understand CEOs must develop and implement strategy.
CEOs understand that boards seek to assure the value of their credit unions is enhanced for the benefit of owners and stakeholders.
6. Constructive executive sessions. Twice per year, boards should conduct a full board executive session. Generally, the purpose is for open discussion about, guidance for, and helpful feedback to CEOs.
Two board members who are present in the executive session should give CEOs feedback to ensure a uniform message.
7. Self-evaluation systems. The finest way to develop as a board and board members is to set group and individual expectations and measure results.