At the March 2018 Board Meeting, we welcomed three new farmers to our 14-member Board of Directors. (Please see related article on page 6.) The new members represent districts 6, 11 and 12. They were elected by eligible delegates during district meetings held earlier in March.
Due to term limits, board turnover will continue the next two years. Two board members will reach term limits in March 2019 followed by three more in March 2020. There are many opportunities for the next group of leaders to step forward to be part of the governance of this great company, a role that is crucial to the ongoing success of MFA.
Effective governance provides the foundation for a strong cooperative. While we’ve lost some outstanding directors, the new members possess the skills to step in and quickly provide valuable contributions. I firmly believe the entire board is blessed with the passion, commitment and vision needed to properly carry out their duties as directors.
A seat on a cooperative board comes with a great deal of responsibility. To govern a member organization such as MFA Incorporated, directors must be sensitive to the needs of members while looking out for the best interest of the cooperative, a duality commonly referred to as the duty of loyalty.
Board responsibilities vary by company. For MFA, that role can best be described as oversight of the business. Board members guide and protect. Specifics would include:
- Hiring CEO an d approving the management team
- Developing strategy and policies
- Ensuring financial strength, including budgeting and risk management
- Representing and informing the membership
As you can see, the board does not get involved in day-to-day operations of the cooperative. However, they must maintain a high level of engagement. Engagement starts by developing a collaborative partnership with senior management. It is the basis for providing insight, advice and support to the management team.
Proper engagement includes time demands more significant than just the six board meetings held each year. Board members must stay abreast of company operations and the financial progress throughout the year. From a personal growth standpoint, many participate in a cooperative training program.
A cooperative is a unique business model that benefits communities as well as its member-owners. The cooperative model is powerful if focus is placed on the owners.
The most important benefit for the member is the existence of the co-op itself. People invest in a co-op because they want to use its services. Also, members receive benefit from joining like-minded farmers in supporting the mission of the co-op as well as the community it serves.
In our society, we are programmed to look out for number one; we are not taught how to create, maintain and share the ownership of community assets and common wealth. The cooperative structure offers an economic means to meet our common needs through democratically owned businesses.
Fortunately, we can look to the cooperative principles—along with the generations of businesses that existed before us throughout the worldwide cooperative movement—to establish effective and sustainable structures that balance the needs of individuals and business so both can prosper.
If co-op members only look at personal gain, they miss the power of cooperation. The opposite is also true: if cooperatives don’t offer meaningful benefits to its owners, cooperative leaders have missed the point. Cooperatives must balance the needs of the owners and the needs of the business they own. Your board of directors is elected to ensure that balance.
You have a strong and engaged board. The strategies they have developed should provide you with an assurance that the board transition will not be a distraction to our stated mission—to provide economic benefit to our member-owners.