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< Back In Search Of The Strategic Board Paul Dionne Jul 16, 2024 Discover how credit union boards can become agile strategic partners and lead their institutions to future success. “Plans are worthless, but planning is everything.” – Dwight D. Eisenhower “I always say don’t make plans, make options.” – Jennifer Aniston Credit union board directors often ask me how they can improve the way their boards provide strategic oversight and support. They describe member expectations growing as quickly as the new channels, products and services being offered by competitors. Consumers expect more convenience, bespoke service, and assurance that a provider has their financial back. Or else! As the financial services ecosystem faces ongoing disruption, credit union leaders see a need to become more agile and better prepare for multiple uncertainties. Board directors must get involved if they want to support their credit unions becoming more nimble and resilient as part of their long-term strategic direction. How can boards become better strategic partners? As credit union board directors learn during their first onboarding session, directors carry fiduciary responsibilities and bear ultimate responsibility for ensuring the safety and soundness of their credit union. But fiduciary responsibilities are often where board meetings go to die. It is so easy to fall into a “report-out” agenda with Q&A that takes up all of a board’s time and energy deliberating over what happened in the past. Boards must also devote their time to strategy. And strategy is all about the future. In order to fulfill their role as leaders of their credit union, boards must provide strategic focus and direction. In Quantum Governance ’s The State of Credit Union Governance, 2020 study, we asked What are the skills that add the most value in the Boardroom? The top answer from leaders was “Ability to focus on the future” with 76% of respondents checking that box. Boards can begin supporting strategy by developing and applying their long-term perspective to help prepare the credit union for the future. Dialogue on strategy should be ongoing, not reserved solely for the annual strategic planning retreat. Are you finding ways to keep directors informed about the future of financial services so they understand emerging risks and opportunities? Do your board meetings have substantial blocks of time dedicated to strategic dialogue? Are board directors equipped to ask future-oriented questions that enhance planning and preparedness? Returning to those fiduciary obligations, boards are typically well versed and skilled at risk mitigation for safety and soundness. But risk also comes in another form: the judicious taking on and managing of risk to gain strategic advantage. Every strategic plan includes risk! Strategic boards understand that addressing risk taking in a mindful and calculated manner is an essential element of strategic planning. A failure to pay attention to risk taking hampers a board’s ability to provide both fiduciary and strategic oversight. Consider, for example, how a credit union might advance a strategic goal by taking on more lending risk. Would extending loans to lower grades deepen member engagement, contribute to growth goals and support the mission? Or will it over-extend your lending team, balloon charge offs, and damage your reputation? What is the right balance to strike? This type of deliberation is best addressed when a board and CEO/senior management are working in concert. I am not suggesting boards take the strategic planning steering wheel out of the hands of their CEOs! Boards need to know their lane. For example, operational planning still belongs to the CEO. Boards should endeavor to engage in regular dialogue with their CEO/senior management (and likely others) on high-level strategic matters. Boards can provide constructive feedback and help ensure accountability. Credit unions enjoying a healthy constructive partnership between the board and CEO are likely to make better strategic decisions. If we are to take Ike’s and Jennifer Aniston’s quotes at their word, credit union boards would do well to learn how to contribute to their credit union’s strategic planning. Boards that understand and support their credit union’s strategy and the risks being taken can help create parameters that foster greater operational agility for staff. The benefits can make the difference between a credit union set to thrive in spite of an unknown future versus one slowly drifting into irrelevance. Strategic boards provide the kind of understanding and support that empower CEOs and their teams to execute the strategy more nimbly and confidently. Planning is indeed everything, and boards should play a central role. When that unexpected storm blows in your face, the planful credit union will be able to review the options that were developed, pivot, and keep moving forward. All with the confidence by staff that their board understands the game plan, the risks being taken, and has their back. Previous Next

< Back Mentoring … Because If We Don’t, Who Will? Jennie Boden Dec 17, 2021 Supporting other women as they advance is important. A year ago September, after Ruth Bader Ginsburg died, I wrote an article for Advancing Women called The Thin, Strong String that Ties Women Together about how successful women have long helped the next generation find their footing and be better able to succeed. I thought of the thin, strong string piece when I heard that—quietly, with no fuss or fanfare—one of my newest colleagues had set about checking in weekly with one of our more junior female staff members. I’m proud to say that Lynette Smith , the recently retired CEO of $131 million TruEnergy Federal Credit Union in Springfield, Virginia, has joined the ranks here at Quantum Governance as a lead consultant, and we are the better for it. Even though the junior staff member in question reports directly to me, I heard about Lynette’s calls to her through the Quantum grapevine. There are times when the grapevine at small organizations can be … well, you know. But this time, I was happy to have heard about Lynette’s kindness in this way. My father used to say that the truest kindnesses are those that you extend when no one is looking. And certainly, Lynette’s regular check-in calls were never intended to be known by anyone else—let alone did she expect that they would surface in this article. But they have. Like most organizations, we’re not perfect. We have our foibles. (Yes, even consultants have foibles too.) But I felt lifted when the grapevine brought me news of Lynette’s calls to our staff member. The thin, strong string that ties women together went from Lynette to our staff member and then to me too. There is so much more work to be done. More mentoring to offer and to receive. More quiet, under-the-radar phone calls to make. And we must all do our part. For the ones that come after us and alongside of us, and even for those who are above us. Because after all, if we don’t, who will? And then I started to think more about that thin, strong string and all the women that I’ve known throughout my career—the women that lifted me up and the women that didn’t. I wondered, what does being a mentor really mean, anyway? The word comes from ancient Greek mythology—a class I skipped more than I attended when I was studying literature at the University of California at Berkeley. When Odysseus left his wife and son to fight in the Trojan War, he placed his son under the care of a man named Mentor, with directions to protect and guide his son. The war was a long one, and Odysseus was gone for 10 years. During his absence, Mentor failed miserably at his one and only job. It was a woman, of course, the Greek goddess Athena, who finally came to the rescue. Impersonating Mentor, she helped to save Odysseus’ son. Athena, the goddess of wisdom and practical reason. The city protectress. The goddess of handicraft and warfare, too. In the Middle Ages, I found in a resource by Roche for this course , the notion of mentoring “’became common practice in the time of the guilds and trade apprenticeships when young people, having acquired technical skills, often benefited from the patronage of more experienced and established professionals.’ In the 1970s, business people and researchers started to recognise ‘the vital role mentors play in the development of corporation executives’ (Roche, 1979).” How many mentors have you had? I mean really, truly good mentors? People who had your best interests at heart, even when you might not have known what your best interests were? And how many of them were women? How many authentic, open relationships with women at work have you had? Was there a woman who was your “protectress?” Or, like another colleague recently shared with me, did the goddess of warfare show up when it was time to present your good idea to the boss? Earlier this year, CUNA published a study that found that 51% of all credit union CEOs and 33% of all board members are women. This is good news, given that only 3% of CEOs and 16% of board members at our nation’s banks are women. But is it good enough? Women make up 51% of our nation’s population , and the 2021 State of Credit Union Governance report, COVID-19 and DEI: Revolution & Evolution in the Credit Union Community , finds that 47% of credit union board members report that gender is a low priority when recruiting new directors. There is so much more work to be done. More mentoring to offer and to receive. More quiet, under-the-radar phone calls to make. And we must all do our part. For the ones that come after us and alongside of us, and even for those who are above us. Because after all, if we don’t, who will? Previous Next

< Back Great Things from the Great North Michael Daigneault Jul 25, 2017 Three overarching Canadian principles that can be applied universally I love Canada. After all, my birth name is Michael George Daigneault. (You’ve got to say it with a strong French accent!) It’s as French-Canadian as you can get, and yes, you’ve guessed it – my family emigrated to the U.S. from the wheat fields of Weeden and Valcourt in Quebec. In all, many cool things are from Canada: governance geek, along with snowmobiles, egg cartons, insulin, Trivial Pursuit, Péché Mortel beer, Justin Trudeau, Celine Dion, Peter Jennings, Dan Aykroyd, Dwayne “the Rock” Johnson, Margaret Atwood, Shania Twain as well as the “Ryans” (that’s both Reynolds and Gosling) all are from Canada. In addition, the first credit union to open its doors in North America did so in Canada – at the start of the 20th century in Levis, Quebec. There Alphonse Desjardins organized La Caisse Populaire de Levis. Just about 10 years later, he helped organize the first credit union - just down the road a bit - in Manchester, N.H., and so credit unions were born in the United States in 1909. A few years ago, CUES began working more directly with its credit union members in Canada, and Quantum Governance had the good fortune to begin doing so, too. We have learned that while there isn’t just one set of standards in Canada there are, none-the-less, a number of overarching principles that guide Canadian credit union governance and are worth thinking about. They include: 1) A robust commitment to ongoing education: Canadian best practices and regulators focus on continuing education for all CU board members, CEOs and audit committee members. Now, we’re not suggesting that credit union education in the United States needs to be regulated. We would, however, stand up and cheer if more credit unions would require regular training for both board members and senior staff. So much is changing; so much has yet to be learned. 2) A durable culture of responsibility and accountability : We’re doing more and more studies for our U.S.-based clients on board member compensation. One of their stated interests is an increased measure of board member responsibility and accountability. We’ve seen this in our neighbors to the north, where compensation for board members is a normal course of business, along with a remarkably high level of responsibility and accountability. 3) Ongoing board member skills evaluations. A unique aspect of the Canadian regulatory framework is to require regular evaluations of board member skills. While it has increasingly become a best practice in the United States to evaluate boards as a whole , our Canadian credit union clients pushed us to create a new tool to support their special needs – a “ Director Skills Assessment .” This assessment goes a step deeper to help evaluate individual board members’ contributions to the leadership of the credit union across five key areas: 1) governance culture; 2) personal attributes; 3) leadership skills; 4) engagement; and 5) knowledge centers. And so we say thanks to our friends to the North -- for peanut butter, Trivial Pursuit, some delightful beer, credit unions and some great ideas to help us along the way. Previous Next

Perry Haaland, Ph.D. Statistician Perry Haaland, Ph.D. Statistician is an expert in a wide range of statistical methodologies. Dr. Haaland has more than 30 years of professional experience as a statistician. He brings the practical experience of solving complex problems in an industrial research setting along with well-honed skills in explaining statistical concepts to management at all levels. He retired in 2017 as the lead statistician at Becton Dickinson, a Fortune 250 medical technology company. Dr. Haaland is a strong proponent of effective graphical analyses, having been one of the founding members of the Section on Statistical Graphics of the American Statistical Association. Dr. Haaland is currently Adjunct Professor of Statistics at UNC-Chapel Hill where he is developing a curriculum for teaching data science to graduate students in statistics. Learn More Back

< Back Moving Beyond The Strategic 'Moment' Michael Daigneault and Jennie Boden Sep 27, 2016 Incorporate strategic planning and thinking into your routine discourse. When more than 30 percent of our clients describe themselves as “less than effective” at something, we sit up and take notice. And that’s exactly how (and how many) of the board members and CEOs we work with describe the challenge of articulating a compelling future vision for their credit unions. Not having a future vision for your credit union is a genuine problem, but one that can be overcome (though not easily, or a third of our clients wouldn’t be struggling with it!). Is your credit union challenged with crafting or updating the foundational components of your overall strategic plan—vision, mission and strategic goals—as well as the more specific strategic objectives and metrics undergirding them? It's worth the struggle to get your future vision right. This is much more than just a convenient tagline or agreeable-sounding statement in your annual report. The conscious or unconscious future vision that a board and senior team hold in their heads has real consequences. Crafting a clear and effective path forward that will truly benefit members is among the most critical and nuanced challenges you will collectively undertake. Yet many boards and executive teams spend less time thinking about the consequential strategic issues facing their credit union than they do on small changes to the loan-loss ratio, car loan volume or even on a single member complaint suggesting that the carpet needs to be replaced in a branch. We recently facilitated the CUES Director Development Seminar in Santa Fe, New Mexico. When we asked the 100-plus attendees who included strategic discussions regularly on their board meeting agendas, one brave soul posited, “Well, we have an agenda item called the ‘strategic moment.’” Though the room spontaneously filled with laughter, the speaker was quite serious, and everyone knew it. Many other attendees may have recognized that by including such a “moment” on the agenda, their colleague was likely well ahead of their own routine meetings typically filled with data-intensive, financial and fiduciary oversight reports. Veteran directors may recall the days when their credit union was just forming and their role was to pour over financial statements, do cash counts and fill the void that a lack of professional staff created. Today the director’s role is quite different. Unless your credit union is very small or in start-up mode, you rely on professional staff to brief you on financial and fiduciary reports. You need to provide effective oversight, hold staff appropriately accountable—and then move effectively to your strategic responsibilities that will help propel your credit union to flourish into the future. In that spirit, we recently developed a list of sample strategic topics for directors to discuss in board meetings, even just for 20-30 minutes. Not all of them are applicable to your situation, but they are the types of questions that can help you regularly exercise your strategic thinking muscles: What criteria would you use in considering—or rejecting—an offer to merge your credit union into a larger one? What types of risks does the evolution of payment systems foreshadow for your credit union? How is your credit union growing? How might you need to grow differently in the future? Even if your credit union is growing, is it genuinely improving members’ financial lives? What would the “ideal” board for the credit union you envision in the future be like? Do you have the right blend of directors for that future? What would the future focus be? What committees would the board have? What type of relationship would it have with your CEO and executive team? What type of relationship would it have with your members and the community? How does your credit union define its risk tolerance or philosophy? Are you too risk-averse? How does your credit union’s risk profile compare to peers? How should you balance ROA, risk and stewardship to members? How do you leverage your cooperative culture into a competitive advantage? Are there other success measures you should be looking at, beyond financial performance? We strongly encourage the board to work hard to fine-tune a strategic plan that includes clear vision and mission statements, strategic goals, objectives and metrics in constructive partnership with your committee leadership, CEO and executive team. After reaching a consensus on the features on the accompanying chart shown in blue, challenge your CEO and executive team to develop their organizational work plans to meet or exceed your agreed-upon strategic goals. But don’t stop there. Include regular and ongoing strategic thinking, discourse and potential changes to your strategic plan, if necessary, in board meetings throughout the year. Insist that your CEO and management team report regularly on the strategic metrics of success as you march toward achieving your strategic goals and objectives. Consider changes in the marketplace or your business environment regularly to assess whether anything needs to be fine-tuned, adjusted or even eliminated. Strategic planning and thinking are continual processes. Off-site sessions annually or every few years may be helpful to recalibrate your leadership’s thinking, but they’re not the end-all. The real work of strategic planning should be a regular feature of the discourse and thinking of the board and executive team—day in and day out, moving beyond the “moment” (though that’s a good start) to become the central focus of your most important deliberations. Previous Next

< Back Did You Dust Off Your Old Pandemic Plan? Michael Daigneault and Jennie Boden Mar 24, 2020 Key ideas about response oversight and future strategy If you’re like most in this world today, you likely feel like you’ve lived a lifetime in just the last week. I know that we have. As we write to you safely from our home offices, we send well wishes to you and everyone in your circles that you are safe, well and doing what you can to “flatten the curve.” But we also know that you all have immense responsibilities. Personal responsibilities to your families and your loved ones. And professional responsibilities to your employees who are looking to your credit union for stability and, yes, a paycheck. Responsibilities, too, to your members who are counting on you to keep your doors open—or at least your drive throughs and your ATMs—so that when they need access to their funds, you are there. And eventually, they may need even more from you. In 2005, the White House, through the Homeland Security Council, issued the National Strategy for Pandemic Influenza —which addresses the threat and potential impact of a pandemic. At the time the experts issued that document, they were focused on a pandemic resulting either from a flu strain that existed then in birds or another influenza virus. The National Strategy is still very relevant, and it outlines how the government prepares, detects and responds to pandemics of all kinds. It is still in use today. “It also outlines the important roles to be played not only by the federal government, but also by state and local governments, private industry, our international partners and most importantly individual citizens…” It states that the “private sector should play an integral role in preparedness before a pandemic begins and should be part of the national response.” A few short months after the federal plan was released, the National Credit Union Administration issued a guidance letter in March 2016 stating that “credit unions and their service providers supply essential financial services and, as such, should consider their preparedness and response strategy for a potential pandemic.” It went on to say, “The National Strategy addresses the full spectrum of events. The main components of the National Strategy address: Preparedness and Communication; Surveillance and Detection; Response and Containment.” In 2007, the Federal Financial Institutions Examination Council issued its own guidance through the Interagency Statement on Pandemic Planning , which was just updated earlier this month due to the current COVID-19 Pandemic. If you’re like most credit unions, in response to all of this guidance and these recommendations, someone at your credit union prepared a pandemic response plan back then, and put it on the shelf, thinking that you’d never in a million years need it. Well, a million years has come to pass. We spoke just a few days ago with the CEO of a $500 million credit union who remembered that her staff had developed a pandemic response policy some time ago, and they “dusted it off” (her exact words) and put the policy into motion. To her relief, so far it has been working well for her credit union. Some of the specific elements of that credit union’s implementation plan include: Any employee who has remote work capabilities is required to work from home until further notice. (This includes at least one employee from every department, as well as multiple call center employees). All branch lobbies are closed until further notice, with only drive-thru options open. Additional deep cleaning services have been contracted for all facilities. Additional technology has been purchased to support increased remote capability. New member products and services have been created including a new short-term loan product, a low interest rate, no down payments, no documents required, reduced restrictions on skip-a-pay loan program, etc. A communications program has been implemented to reach members via email, social media, website and on-hold messages. The credit union has contracted with CUES Supplier member CO-OP Financial Services , Rancho Cucamonga, California, to provide overflow call center support, if needed. An emergency sick leave policy has been created and enacted. If you don’t have a pandemic response policy, you are likely developing the components of your policy as you respond each and every day to the mounting issues that confront you. Ensure that someone is memorializing the good actions that you take as you move through this crisis so that you can thoughtfully, when we all come out of the pandemic on the other side, translate your actions into a comprehensive, cohesive policy. And very, very importantly, ensure that the overarching framework and strategy of your plan is developed in constructive conversation with your board of directors. Does this mean that the very detailed elements of your plan, i.e., what does deep cleaning mean or which individual employees should be designated to work from home, should be approved by your board? No. But it does mean that the overall, strategic approach of your plan should be developed in discussion with your board and that your board should ultimately approve the key principles underlying your pandemic response plan. If it’s been a while since you “dusted off” your pandemic response plan, consider this template that we’ve crafted and take a look at the National Strategy, both of which we hope will provide some support and direction to you and your credit union’s leadership (board and management alike). Stay well and stay safe. P.S. Be sure that you and your Board are staying up to speed on all of the regulatory updates regarding COVID-19, including those impacting annual meetings and board elections! Previous Next

< Back Charting a New Direction Michael Daigneault Apr 1, 2016 The roles of leadership in today’s credit unions are changing; specifically, there’s an important new way to think about key board leaders. The ideal role of board treasurer was a recent topic of conversation on CUES Net™ , the CUES-members-only listserve. Without identifying which CUES members were having the conversation, the CUES Net moderator asked for my input, and posted my thoughts back to the list. My thoughts stirred a bit of controversy, and I thought to myself, “Well, good. Let’s have this discussion. Let’s talk about the changing roles of leadership in today’s credit union.” In this article—as I did in my comments to CUES Net—I’m going to challenge assumptions about the role of board treasurer—and the other officers. Get ready. I’ve never been one to shy away from a good old-fashioned give and take, and I think it’s time that we all push ourselves to go beyond the status quo when we think of the board officer positions that are leading our movement into the future. I’ve written and spoken in recent years about the nine key challenges facing the credit union of the future. ( Read about them in my article ). To be certain, you and your colleagues are facing a lot more challenges today than you were a decade or more ago when many of you signed up as board members. So, if the world around you has changed, and continues to do so at a rapid pace, shouldn’t some of our assumptions and approaches to leadership be open to change, too? I think so, and I’m encouraging you to revisit some long-standing assumptions you have about board leadership. Assumption #1 : Boards should never “manage” anything. I love asking board retreat participants if boards should manage. The vast majority of board members (and nearly all CEOs) gasp and respond with a resounding and unequivocal, “no.” So, I continue prodding, asking: “Are there no circumstances under which a board should manage?” I get silence—and blank stares. “None?” I ask. Ultimately, I’ll have one brave individual who will posit that: “Boards should manage their one employee—the CEO.” Another brave soul may offer, “Boards should manage themselves.” And this becomes my opportunity—they are correct! If a credit union board should be responsible for managing its own operations, then it would be logical to consider your chair as your board manager-in-chief. He or she is responsible for the overall, effective functioning of your credit union’s board. Beyond crafting and facilitating your meetings in partnership with the CEO, your chair should ensure that your board is building a healthy governance structure and practices. (Of course, we recommend an active governance committee as an important partner in this endeavor, too.) But, these are just the nuts and the bolts part of the job. The real key to what the board chair does is in fostering and then managing the right culture for your credit union board. Be sure that you and your colleagues appoint a chair who can inspire and engage your board members—one who sets and models high ethical standards, from both personal and professional points of view. It’s also important that he or she work well with the credit union’s CEO—fostering a constructive partnership between the board and senior management. Assumption #2 : The vice chair’s job is boring. Much like the vice president of the United States, the position of vice chair used to be pretty boring. But it doesn’t need to be. What if you reframed the vice chair role as your board learner-in-chief? Yes, of course, this means your vice chair should be learning everything he or she can about the role of the chair should the vice chair be needed in that role some day. It is, after all, the vice chair’s role to be “at the ready” at all times. This means your vice chair should be ready to fill in for short-term absences and the potential long-term replacement of your chair. But being the board learner-in-chief can mean so much more. And it should. To meet the challenges before you, you and your colleagues need to be constantly learning and growing. There is no one better suited to lead this charge toward adopting the culture of a “learning board” than your vice chair. He or she should already be in full learning mode and can be a catalyst to encourage you and your colleagues to actively pursue learning on an ongoing basis. Lastly, you can consider charging your vice chair with special projects or initiatives like being a public spokesperson at key events, coordinating board retreats, designing better board meetings, strengthening the strategic planning process, or even a successor CEO search. The vice chair position lends a level of credibility to these initiatives, which is important, while allowing your chair to keep his or her eye on the overall management of your board. Assumption #3 : The board secretary’s job is to take minutes. (That is, the secretary’s role is even more boring and inconsequential than the vice chair’s!) This is perhaps my favorite board officer position to discuss. I always ask this very simple question: “What is the role of the board secretary?” And there are usually one of two answers given. The first is this: “To take the minutes.” And the second: “To edit and approve the minutes taken by the staff.” Really? That’s it? Boring… But no–that’s not it! For a little inspiration, we needn’t look far. In the corporate sector, the board secretary has a very, very important role. He or she is, as enumerated by the Canadian Society of Corporate Secretaries , responsible for ensuring the integrity of the governance framework, the efficient administration of the company, compliance with statutory and regulatory requirements, and implementing decisions made by the board of directors. There. How does that sound? Boring? I don’t think so. Now, that’s a job I’d like to have as a volunteer board member. It goes pretty far beyond taking minutes, doesn’t it? Make no mistake. You are helping to lead an organization every bit as complicated or sophisticated as a corporation. While a credit union’s structure may be different from its for-profit competitors, the stakes are just as high. And some could argue that the complexities you face as a credit union—with members’ interests and a mission to balance—place even greater demands on your governance structure, policies and practices. Consider your board secretary your board builder-in-chief (or, better yet—your chief governance officer), working hand in hand with your chair to build a stronger board. Your board secretary should be tasked with seeing that your board adheres to organizational policies, as well as national regulations. He or she should also oversee board nominations and a robust onboarding process by chairing the credit union’s governance and nominations committee. And this committee, too, can be charged with working with the chair to build engaging board and committee meetings to effectively carry out the board’s work. Assumption #4 : You have to be a numbers person to be the treasurer. At last we come to the source of the controversy that sparked this article. In my response to CUES Net, I suggested that it is the role of the contemporary credit union treasurer to help fellow board members effectively translate complex financial reports and data into comprehensible and insightful information that can effectively support strategic decision-making at the board level. There was some concern raised that perhaps what I was suggesting was that board members (i.e., the treasurer) might have more experience in the financial realm than the credit union’s CFO. I wasn’t. I was actually trying to make the opposite point. If your credit union board is like most, it’s not made up of financial whizzes and MBAs. It’s made up of everyday people like you and me, representing the membership and, for whom their financial literacy and acumen may have been developed through their service on the credit union board. And if they’re like me, perhaps their eyes glaze over when they see 26 Excel spreadsheets coming their way. I see an effective treasurer working with the CFO and his or her staff—poring over those Excel spreadsheets—to ensure the board receives clearly discernible reports, dashboards, bar charts and graphs, all in an attempt to clarify and deliver the complex financial reports in a manner that everyone on your board can genuinely understand. My colleague shared a story recently that made perfect sense to me. She said that the best treasurer she ever saw was a marketing guy. Yes, you read that correctly. A marketing guy. He didn’t want the job, but no one else would take it. He was the last guy standing. And what made him good at the job (indeed, great at the job) was that he didn’t fully understand the numbers at first, and he kept asking for clarification until he did. And, he was good at communications and visuals, so that was a plus. The joke around the boardroom was that if Jeff could understand the financial reports, anyone could. And they were right. He had them “translated” into a form he could genuinely understand. This helped Jeff—and everyone else on his board! How crystal clear are your financial reports? Can your new board members truly understand them? Or are you still presenting 26 Excel spreadsheets (in the form in which the staff tends to understand them) to your board members and expecting them to read them like a CPA? Assumption #5 : Everyone deserves a chance to be chair. Don’t simply adopt an automatic ascension plan for the board member who “hasn’t had a chance to be the chair yet.” Many credit unions have a practically automatic process whereby directors begin as a regular board member, then become the secretary, then move to treasurer through to vice chair and right on up to chair. Not everyone is cut out to be chair. Automatic ascension provides little to no wiggle room concerning needing a particular person to be chair because he or she has a particular skill set or capability; due to big changes being on the horizon for the CU; or because the board needs to focus in a new direction. Choose the right candidate for the right time, not simply because it’s his or her “turn.” Assumption #6 : You’ll know what to do when the time comes. One of the most important leadership assumptions I can help you challenge is that you will know what to do when the time comes. This relates directly to the notion that you should always have in place a leadership succession plan—and I’m not talking about a CEO succession plan (although I think you should always have one of those in place, too!). Your board and its officers are some of your most important strategic assets. Treat them accordingly. Plan ahead for changes in board leadership—both the kind that can be anticipated and those that cannot. I’m not talking about drawing up a 10-page, detailed plan. I’m talking about outlining the basics, including: who will serve as board officers on an interim basis; what roles certain committee(s) will play; and how the credit union’s CEO may be impacted. Be sure any succession plans are in line with your credit union’s bylaws, which may provide some direction on these issues. Above all, be open to even the idea of change. Here’s an example to explain what I mean: I spent the better part of a recent training arguing the merits of having a board secretary play an increased role within the organization. Really? I could hardly believe it—here was someone before me, arguing against a more engaged, more robust role for a board officer. Arguing against a board volunteer filling a key need within the credit union. Why? Because the secretary was so busy reading and approving all of those meeting minutes? I hardly think so. What’s the downside? I wondered. Imagine the upside… Previous Next

< Back Finding Balance in Board Meetings Gisele Manole Sep 13, 2024 Efficiency vs. Engagement In a recent conversation with a credit union board member, she expressed frustration over the increasingly automated and predictable nature of their monthly board meetings. This shift towards efficiency and expediency has left her questioning the necessity of her presence at all. This sentiment is a stark contrast to the past, where the primary complaint was the lack of focus and excessively long meetings. The Shift in Board Meeting Dynamics For many years, credit union board meetings were often critiqued for being too operational and detailed, often described as “chasing too many rabbits and catching none.” These meetings were lengthy and lacked substantive discussion. However, it seems that in the quest for efficiency, for some boards, the pendulum may have swung too far in the opposite direction, sacrificing curiosity and meaningful dialogue for expediency. Striking the Right Balance As with many things, the ideal approach lies somewhere in the middle. While asking questions is a sign of engagement, asking the wrong questions can indicate a lack of understanding of a director’s role. My colleague, Paul Dionne, recently wrote about achieving balanced, strategic-level dialogue while efficiently meeting fiduciary, legal, and regulatory obligations. The Traditional Role of Credit Union Board Meetings Historically, credit union board meetings have emphasized the formal role of the board. A routine agenda was often used to move from one report or policy issue to another. Board members were present to receive information, provide fiduciary oversight and make quick decisions when necessary. Many decisions were made immediately or at the beginning of the meeting, with strategic questions and generative dialogue often seen as obstacles to their progress. The Need for Generative Dialogue To foster a more engaging and productive board meeting, it’s essential to incorporate generative dialogue. This means creating space for strategic questions and discussions that go beyond routine reports and decisions. Encouraging curiosity and deeper engagement through thoughtful questions can lead to more meaningful outcomes and a stronger connection to the credit union’s mission. Perhaps not all questions need to be answered right away. Perhaps the best questions linger and fuel conversations for many meetings to come. If the question has a finite answer like yes or no, it’s likely operational in nature. What are some other helpful cues to guide strategic, board-level questions? Operational Indicators: Is it about the past or present? Is it about day-to-day operations? Is it about how you should get there? Strategic Indicators: Is it future-oriented? Is it central to your vision, mission or strategic goals? Is it about where you should go? Finding the right balance between efficiency and engagement in board meetings is crucial. While it’s important to maintain focus and avoid operational detail, it’s equally important to encourage strategic thinking and meaningful dialogue. Previous Next

The Michael G. Daigneault Excellence in Governance Grant The Michael G. Daigneault Excellence in Governance Grant honors our Co-Founder and Principal Consultant, Michael G. Daigneault and his continued commitment to developing exceptional leadership in mission-driven organizations through governance excellence. This grant initiative aims to strengthen the governance effectiveness of nonprofits and credit unions, providing them with the tools and advice they need to drive positive, lasting change throughout their organizations and enhance their impact on the communities they serve. The grant provides one credit union ($250M in assets or less) and one charitable nonprofit (operating budget of less than $5 million annually) with a pro bono Full Governance Assessment inclusive of the following: a proprietary online governance survey a report comprised of survey data and expert recommendations based on survey results a facilitated workshop for the board and executive leadership resources such as policies, job descriptions and charters How to Apply Guidelines Before you apply, take a look at the eligibility requirements, funding timelines and frequently asked questions. Funding Guidelines (PDF) Application Thank you for your interest. The application window for this cycle is now closed. Applications for the next cycle will open Spring 2026. Learn More Questions? If you have any questions, please use the form below or email gisele@quantumgovernance.net Contact Us Click Here for the Press Release About Michael G. Daigneault Michael brings more than 45 years of governance, strategy and ethics expertise to boards and C-suite executive leadership of nonprofits, credit unions, governmental entities and other organizations of all shapes and sizes. He is credited for developing a proven methodology for assessing governance and strategy, including a proprietary survey tool for a variety of organizational types. Prior to founding Quantum Governance, Michael was a Senior Governance Consultant for BoardSource studying and advising nonprofit board leadership and Director of Advisory Services at DeLeon & Stang, a preeminent business management and accounting firm. Michael was the Founder and President of Ethics, Inc. – a private consulting and training firm specializing in business ethics for the private, nonprofit and public sectors. He also served as President of the Ethics Resource Center (ERC) in Washington D.C. Michael is a three-time graduate of Georgetown University, holding a B.A. in Philosophy from the College and a J.D. and a Master of Law from the Law Center. He was the first person to graduate from the Law Center with a Master of Law with a concentration in Legal Ethics and Professional Responsibility. A lifelong learner, Michael went on to complete the Corporate Governance Training Program at the Columbia Business School in 2021. Statement of Confidentiality: We will keep all information learned in this application process confidential. No information will be disclosed to any third party unless compelled to do so by law or regulation. Notwithstanding the foregoing, we may disclose information to our authorized contractors with an obligation to maintain confidentiality (e.g., Alchemer and data entry personnel) and personnel with a “need to access'' such information in order to review the grant applications.

< Back Board Engagement Needs A Boost Michael Daigneault May 27, 2014 Strategies to use in your monthly meetings In a recent set of surveys conducted by my firm, Quantum Governance, L3C , only 42 percent of credit union board members across the United States thought their boards were “effective” or “very effective” in engaging their directors. Sadly, this means more than 50 percent of directors said their boards were only “adequate” or even “less than adequate” at engaging the full board. What is really going on at these credit unions that is not engaging for a critical mass of board members? My team and I actually review hundreds of credit union board agendas and meeting minutes annually. Based on this, I can understand why directors are walking away feeling less than fully engaged. Many agendas are fairly routine, with some opening remarks by the chair, a fairly detailed report by the CEO, followed by financial reports, committee reports and maybe (if you’re lucky) an update on the business or strategic plan. Reports, reports and more reports. The tone tends to be formal. Month to month, many agendas don’t vary much. The focus frequently tends to be on “telling” the board information, providing fiduciary oversight and holding credit union management “accountable.” Sound familiar? In my last Good Governance column , I encouraged you to begin to expand your agendas beyond merely the fiduciary—to engage in strategic dialogue, early and often. But, let’s go further. Let the tone of your board meetings vary to include not only formal informational and oversight elements, but also genuinely engaging, persuasive and influential opportunities at the highest levels. (To be clear, I am not suggesting that the board be invited to provide input at the operational or tactical level.) Author Peter Senge provides a very helpful spectrum of the levels of dialogue in a meeting context: At the lowest level of engagement, he suggests that dialogue focuses on telling – telling the board what has been done or what’s about to be done. At a slightly higher level of engagement he suggests that the focus shifts to selling – or advocating an idea to the board. Higher on the engagement spectrum is the notion of testing – testing out an idea with the board to identify its position. Beyond that, Senge urges that there be opportunities for what he terms consulting – or genuinely asking the board’s opinion, with the idea of improving or modifying an idea. Lastly, and at the very highest level of engagement, he recommends discussions designed to encourage participants to co-create an idea or the key elements of an initiative. Vary your agendas based on future needs and important trends. While there has to be some telling and selling, talk also about some element of your strategy each and every meeting. Make time to engage in authentic dialogue. Focus not only on the necessary elements of oversight – but also make sure questions are asked that invite input from board members at the testing, consulting and—when appropriate—co-creating levels of engagement. This means regularly engaging the board in vision, mission and forward-looking questions that everyone knows will make a real difference as your credit union moves forward. Previous Next

< Back Reimagining Your Board Meetings Jennie Boden Oct 27, 2020 To make your gatherings more effective and engaging, first look at the real reasons boards meet. Credit union leaders everywhere seem to be asking the question, “How do we make our board meetings more effective and more engaging?” To answer that question, I think you have to first look at the real reasons that boards meet. To convey information … sure, but information can be conveyed in an email or a report, too. To make decisions? Yes. That’s easy, and a consent agenda can often do the trick, especially when the decisions are straight-forward and non-controversial. To engage with each other? Yes, to be sure. To build trust among directors and with your CEO. Absolutely. To deliberate and plan for the future. We hope so! And we’re sure that you can identify many more reasons that your board meets… First, it’s important to know that while most credit unions by regulation have to meet 12 times a year, the regulators do not say that every meeting has to be the same . When we share this with our clients, they are often amazed, but it’s true. And knowing this alone should allow you to open your mind to the possibility of change—because we know what you’re doing. You’re likely opening up Microsoft Word, pulling up last month’s agenda, changing the date, changing a few key items and hitting “save.” But no more. You don’t have to be bound by the same old agenda that serves up the same old meeting. You can consider rotating the cadence, length, agenda and, yes, the focus of your board meetings throughout the year. In The State of Credit Union Governance 2020 , Quantum Governance, CUES and the David and Sharon Johnston Centre for Corporate Governance at the University of Toronto found that while respondents say they spend 26% of their time on strategic matters (a percentage we dispute given the number of credit union board agendas and meeting minutes that we review each year!), they think they should be allocating 36% instead. At the same time, credit union directors report spending about 17% of their time on a review of financial results (again, here we think this is largely underestimated!), and they’d like to get this number down to about 14%. But how do you go about shifting the focus of your meetings to better reflect the actual, real reasons that a credit union board meets? Particularly in the face of the great challenge that the pandemic has posed, which has greatly limited, if not completely eliminated, your board’s ability to meet in person at times. In the summer months, when everyone is otherwise focused, consider a brief, one-hour meeting via Zoom during which you can quickly dispense with your fiduciary oversight responsibilities, check on where you are strategically, vote on any important issues coming out of committee (via a consent agenda), and make it to the beach by noon. (You might also consider this during the holidays, when the pressure to get to the beach becomes the pressure to go holiday shopping or at other busy times of the year.) Then, identify those “regular” board meetings that you need to have throughout the year and revise your agendas so that they include more time for strategic discussion and less focus on financial-related matters. Remember, it’s highly likely that your credit union’s professional staff has more skilled financial folks on its team than you will ever have on your board. Your job as a board member is to trust them but verify that what they are saying is correct. Not to do their work. Then consider a few board meetings a year where you meet for a longer period of time to really take a deep dive on a few strategic matters. Maybe hold a three- to four-hour board meeting where you take care of the business first and then spend the rest of the time talking and exploring the future of the credit union or critical questions that are before you. Finally, of course, it’s important for every board and management team to spend considerable time in retreat together each year—a one- or two-day time away from it all where you can plan cooperatively, as constructive partners, for the future of the credit union. All of these count as board meetings. Developing a calendar for your board that incorporates a wide variety of meetings will increase strategic conversations at the board level, ensure that you still keep a critical eye on those important fiduciary matters and, most importantly, keep your board members on their toes and engaged. Previous Next

< Back RIP RBG: The Thin, Strong String That Ties Women Together Jennie Boden Sep 21, 2020 Our foremothers paved the way for us; now we pave the way for the women now coming of age. This was written by the author Saturday morning, after the passing of Ruth Bader Ginsburg. I’ve been thinking about all of the stories of the strong women in my family today. This day. The day after Ruth Bader Ginsburg has died. I come from a line of very strong women. My grandmother, Ora, died when I was very small, but I’ve seen pictures of her. She was tall, broad and her hands were well worn. My mother and her sisters used to talk about her with fear and awe and love in the same breath. When Ora was raising her family, which included my mother and her two sisters, a cousin who was developmentally disabled and “the boarders” as my mother used to call them. It was the Great Depression, and she did whatever it took. Sometimes that meant moving from abandoned house to abandoned house, where they would crawl in through an open basement window or maybe it was a window that my grandfather, whom everyone called Hap, broke. Yes, they were squatters. But, if you listened to the Hathaway girls, as my mother and her sisters were known, it was all a great adventure. When the Hathaway girls grew up, they had babies. Lots of them. There were a few boys sprinkled in here and there, although not in my family’s case where four daughters were born. Our family has always been female-centric. My mother’s strength and certitude about who she was and how she would move through the world as a woman was formed during her childhood—coming home after school to find the family had moved one day from the house on Magnolia Street to one a block over on Maybrick—and later as a 20-year old mother when her first-born daughter, still an infant, came very close to dying. Toward the end of her life, she cared for my father as dementia took him and their love story faded slowly and painfully. As the country mourns the passing of Justice Ginsburg and honors her legacy, I’ve been thinking about all of the women who have come before us in all of our families, in all of our circles, in all of our workplaces, and in all of our communities. All of the women who have made us who we are. All of the women who have made things possible for us that we never knew were once impossible. I’ve been thinking about the thin—but strong—string that ties all of us together as women. I’ve been thinking about the paving they did for us. And the paving that we must do now for others. And about the paving that I will continue to do in memory of my grandmother, Ora, my mother, Katie, and the Honorable Ruth Bader Ginsburg. Previous Next