There has been considerable discussion of late about credit union directors getting more representation on state and national trade association boards. I believe trade association boards should be heavy on CEOs. These are the people who are in the trenches of the industry day in and day out. But I also believe directors need representation, after all they are the policymakers for credit unions. I don't think trade associations are under any obligation to designate "volunteer" seats – volunteers should earn it. By earning it they are showing they will do what it takes to be on these boards, which means getting political. Being politically active is an important characteristic for trade association directors because associations need directors who know the issues, know what their peers think, and know how to communicate, whether that be with lawmakers or their fellow credit union leaders. Before directors get too gung ho about getting on trade association boards, they should do an honest inventory of their own boards. A recent Filene Research Institute survey had some interesting insight on boards. I said interesting, but not surprising. Many of Filene's findings are well-known tenets of the industry, but they can still surprise when you see the numbers. For example, most boards are made up of older, white males. Sixty-two percent of directors are over 50 years of age; 89% are white; and men outnumber women three to one. Big surprise? Not at all. Just attend any major credit union conference, and you can see that fact in person. I don't want to look at any moral or ethical issues of this fact, I don't even know if there are any. What I do want to point out is the business problem of credit unions being predominantly run by older, white males. Go to the supermarket, your place of worship, a movie theatre, etc. and just look around. You see all kinds of people in these places and they're not just older, white males. It doesn't make sense from a strategic standpoint for credit unions to be run by boards made up of people who do not reflect their memberships. If you ask an older, white male whether they'd rather earn more interest on their savings or get a better rate on their loans, they're likely to choose the better savings rate because their loan days are behind them. Now that's just one obvious example, but perceptions like these could lead to an overall philosophy that's not thinking of other groups; in that example, younger members. There have also been numerous studies which show women control household spending – doesn't it make strategic sense for them to be represented? Another interesting finding, though not surprising, is that 66% of board elections are held at the annual meeting, while only 30% are conducted via mail ballots. Problem? Most annual meetings don't exactly pack in the members. It's not a true democratic process if only a handful of members who show up at the annual meeting vote. Credit unions have been using this same argument in the bank conversion issue, so they should practice what they preach. Credit unions tout themselves as having democratically elected boards, but I don't think 20 people at an annual meeting is enough to say it was democratic. Now this next finding to me gets at the heart of the problems of boards not being representative of their membership and of boards not doing enough to recruit new directors. Eighty-six percent of CU executives and 77% of board chairs involved in the Filene survey said the nominating committee always re-nominates any incumbent who would like to serve another term. Also, more than half of executives said that poor performing directors are routinely re-nominated. Is that anyway to bring new blood to the board or get rid of the weak performers? Certainly not. None of this is to say boards haven't made an effort to diversify and change to reflect their membership. There are no easy fixes to these issues. Credit unions face a limited pool of candidates. In this on-the-go era where many people bring their jobs home with them and are struggling to get in enough family time, it may be hard to find people willing to serve on a volunteer board. But the study did find that most recruitment comes from word of mouth, often from directors simply speaking to their friends and family about the board. That has to change. Maybe credit unions should have their marketing departments come up with an innovative board recruitment campaign. They could treat it the same way they do a new loan promotion. Get creative, utilize a budget, and track results. Credit unions are good marketers, if they truly wanted to expand their pool of candidates, they could do it. Finally, I couldn't let some fascinating quotes from this publication's coverage of the National Association of Credit Union Chairmen's recent Roundtable Forum in Savannah go unnoticed. When discussing strategic planning, one director said, "Long-term planning is a waste of time." A lot of long-term strategic planning consultants out there cringed over that line, as short-term planning appears to be the new trend. But it might make a lot of sense. In a world where everything is moving so fast, can you really plan strategically five years out? Another director said, "This year, we're doing it (strategic planning) ourselves. No one knows us better than we do." Maybe so Mr. director, but isn't that exactly the point of an outside facilitator? They are there to help you look beyond the credit union's walls and get you out of your comfort zone so you're exploring all options. Comments? E-mail [email protected]