Firing the CEO When Time Has Come: Print Preview
- Credit union CEO firings are rare events.
- CU directors usually have a long tenure and many have built a friendship with the CEO and are reluctant to act.
- Boards can help ensure good performance by setting targets.
No job is harder for a board of directors of a credit union. But no job is more crucial than knowing when to separate the cooperative from a lagging chief executive officer and having the strength to act.
Credit union governance expert Stuart Levine elaborated that “defalcation and theft are also causes for immediate dismissal.”
Reason two, said Lozoff, is failure to meet specific performance targets. Typically, these are measures such as new account openings or asset growth or overseeing a smooth core system conversion. Rarely, stressed Lozoff, will one bad year result in the board exercising this option, but several successive bad years, coupled with much stronger results at competitors, might.