Build Solid Boards to Avoid Heartache: Editor/Publisher's Column
“Directors are at once our greatest strength and at once our greatest weakness,” now-retired CUES CEO Fred Johnson told me in his exit interview. Unfortunately, it is uttered far too often and is far too true. Governance is a common topic of conversation, but I’m not confident much is being done to improve it among credit unions boards.
Governance is a frequent subject at conferences, and some really excellent speakers are acquired to discuss the topic. But like so many educational sessions, attendees go home and, as they say in New Jersey, fuhgeddaboudit.
The board recruitment process is also problematic in attracting qualified board members. If your nominating committee is out of touch with the community, it isn’t going to be very good at the job. There are credit union board members that handpick their successors or new board members, which only helps ensure more of the same. Boards cannot arbitrarily determine a certain candidate may not be “our kind of people.” Not only does this mentality stifle innovation, but it also can contribute to collusion.
Obviously, certain standards must be adhered to but one goal should absolutely be diversity. Diversity in backgrounds, age, gender and ethnicity are important to the success of any business because it provides different viewpoints. Credit union boards must reflect their membership and the expertise necessary to run a credit union.