Aging CU Directors Are An Asset-Not a Liability
In recent months several notable credit union industry conference speakers have suggested that a credit union's board of directors should be as diverse in age, gender and ethnicity as the membership-delivering a backhanded criticism of currently seated boards of directors. Other conference speakers have used the bully pulpit to advocate recruiting Generation Y representatives into credit union board rooms by warning that older board members simply can't understand how to attract this under-30 demographic of online whizzes and social network buffs.
Both of these pronouncements are preposterous. Taken to the extreme, they advocate a credit union board diversity quota system.
While perhaps well-intended, these misguided admonitions fail to recognize that older directors are an asset to the credit union, not a liability. To believe otherwise misses the point. Credit union directors are fiduciary stewards for the overall institution and not merely advocates of only the consumer members who look just like them. The federal and state credit union laws never intended consumer-elected directors to represent specific ages, genders or ethnicities. That is not to suggest that having a diversely composed board of directors cannot be a good thing, but the converse-having an older but wiser board-is by no means a bad thing.
The senior citizen directors sitting in board rooms right now are the industry's best hope for retaining future marketplace relevance or even outright survival. And no politically correct platitudes about diversity or sips from Spanish explorer Juan Ponce de Le?n's Fountain of Youth would change that reality.
Unlike members of Congress, credit union board directors are also not elected to represent geographic regions or any other manifestation of a subset of those who voted for them. Credit union board directors were elected by all the consumer members who chose to vote in the election. Directors serve the entire membership by guiding the government-chartered and regulated financial institution on a safe and sound, consumer-focused course. The duties of the board of directors, regardless of its demographic mix, flow to the institution and not to any individual member. Most people who join credit unions care about great service, affordable pricing, good rates on loans and savings and about convenience, not about politically correct board diversity quotas. Unless it is a demonstrable safety and soundness concern, board composition is nobody else's business.
No one can argue with the fact that there are currently an abundance of gray-haired seniors of both genders and assorted ethnicities sitting on credit union boards. It is also unlikely that these seniors spend inordinate amounts of time texting their BFFs or tweeting about their latest escapades. However, unless a board's directors are hopeless micromanagers, they really don't need to know those things in order to fulfill their duties. They can rely on staff and vendors to be the experts on the youth culture, as well as every other potential membership growth opportunity. Due to many historic and marketplace factors, the average age of credit union consumer members is currently around 50 years old and continues getting older each year. If that is not evidence enough, then simply scan the audience at a typical credit union industry conference general session. It would appear that credit union directors already mirror their aging memberships. But demographic trends alone don't explain why older credit union directors are such an asset.
As ancient Roman playwright Titus Maccius Plautus (254-184 B.C.), who had a unique insight into his people and his times, said, "Not by age but capacity is wisdom acquired." Both despite and because of their senior status, currently seated credit union directors bring an abundance of capacity to the table. They are from all walks of life and possess a variety of experience-laden insights derived from their many years of involvement in business, health care, education, government, the military, real estate, financial services, air transportation, manufacturing-just about anything and everything that has to do with America.
Those wrinkled faces around the board table represent an institutional asset that would cost a fortune to acquire in the open market. While the need to keep on learning never stops, these senior citizen directors are well equipped to tackle both the routine and the strategic. And their levelheaded, real-world experience is priceless, especially at a time when the very survival of the credit union might be at stake.
It would certainly be appropriate to broaden that capacity by having all kinds of directors, but the credit union industry should not counterproductively hardwire discrimination by age. Rather than casting aspersions on older credit union directors, the pundits should be awarding them medals of honor for their courage and commitment, two traits that are sorely needed and much in demand at the moment.
And those senior citizen directors should not allow any misguided board diversity critics to deter the application of their wisdom or sense of purpose. Those critics should instead seek counsel from those heroes that battle in the credit union trenches and confirm once and for all how those aging credit union boards of directors are an asset, not a liability.
Marvin C. Umholtz is president/CEO of Umholtz Strategic Planning & Consulting Services.
360-951-9111 or firstname.lastname@example.org