The State of Credit Union Governance, 2018 is the culmination of five years of data collected from credit unions across the United States and a dream long held by everyone at Quantum Governance. The research yielded a number of key findings which we’ve shared previously on our blog. And now we can also share some data-driven recommendations that emanate from those six key findings. We hope that the information shared by credit union board members, CEOs, supervisory committee members and senior staff nationwide will help you and your credit union colleagues further mission success. The State of Credit Union Governance 2018, Report is accessible through CUES.org and free to CUES members. These five core recommendations may help you strengthen governance policies and practices at your credit union:
1. Prioritize governance excellence at your credit union. If you haven’t been taking governance seriously at your credit union, it’s time to do so. And if you have been, it’s time to kick it up a notch. Whether you’re functioning at Governance 101 or 601, it’s time to find out what Governance 201 or 701 looks like for your credit union.
2. Eliminate any perception gaps between your board, supervisory committee and senior staff. If we know one thing, it’s this: Gaps between the board and senior staff will eventually be destructive. We highly (underscore highly) recommend a strong, constructive partnership between the board, supervisory committee and the senior staff—all working collectively to govern and lead the credit union. There were so many gaps in perceptions between these positions throughout the report that it surprised even us, and it should definitely concern you.
3. Ensure you have a plan for board (and committee) rejuvenation. The longer a board member serves, the more positive his or her perception is. While this may sound like a positive finding, it actually concerns us. Are long-serving board members losing their ability to ask the hard questions? At the same time, the number of potential board members among us—if we look strictly at the census numbers—is shrinking. Ensure that your credit union has a viable plan for leadership continuity. It is one of the most critical responsibilities a board holds.
4. Focus on your credit union’s leadership culture. While you may be spending countless hours ensuring that your board members have the requisite training, your committee structure is in place and operating well, and your plan for board rejuvenation is fully up-to-date, don’t forget about building a positive board culture. It takes time and conscious cultivation to ensure a positive outcome here.
5. Charter a governance and nominations committee … fast. Over the years, nominations committees have morphed—first into board development committees and now into what is considered governance and nominations committees. If your credit union doesn’t have one, it’s behind the curve, and you need to get one. Fast. Today’s governance and nominations committee is chartered to address board roles and responsibilities, composition, knowledge and learning, and effectiveness and leadership. We believe this recommendation is so important that a sample governance and nominations committee charter is an appendix to the report.