Build Solid Boards to Avoid Heartache
“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.
Assessments are essential for the modern board, yet many boards won’t use them. Some don’t know how, some are comfortable with the status quo and some just don’t want the rock the boat. If a credit union is scared to address the quality of the board, a major problem exists. The anticipated results are apparent. Being able to feign ignorance doesn’t resolve the root of the issue.
Credit unions must be careful to select the appropriate board assessment tools for the institution’s needs. This is about the ability of the board to address the credit union’s and members’ needs. It’s not about board politicking or hurting feelings. Everyone wants to be viewed as a nice person, but with board responsibilities and liabilities becoming increasingly defined, it’s individual board member’s assets on the line. If the so-called good directors don’t step up to question the abilities of the board, or individual board members, then those folks are not good board members either.
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