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Governance Excellence Delivers Business Success

With ultimate responsibility for setting a cooperative’s strategy and overseeing management’s execution of the business plan, the board of directors plays an essential role in their organization’s direction and success, with a direct correlation between board excellence and business performance.

“An effective board is an integral and critical part of the success of every cooperative organization,” says Jean Cantey-Segal, Chief Learning Officer with FCCS. “And since no individual or group performs at a high level over time by accident, it takes a consistent commitment from each director to contribute to and achieve top-level board performance.”

The board is responsible for providing important insight to management, hiring and overseeing the CEO, and ensuring execution of strategy by management. They’re also responsible for providing long-term strategic guidance, as well as financial, risk and operational oversight. With all these responsibilities, it’s clear that the board’s role is critical to the organization’s sustainability and success.

“Board excellence is ultimately measured by the value the board delivers to the organization”, says Leslie Hilton, Vice President of Governance/Board Development.

“When a board is fully carrying out its responsibilities through its deliberations, inputs to management, actions on behalf of the organization and decision-making, it will be more likely to add value.”

Beyond ensuring the long-term sustainability and mission achievement of the organization, an excellent board provides consistent long-term direction and guidance for management, providing constructive feedback, challenge and support that helps them improve their performance and respond effectively to change and disruption.

Excellent boards consistently push themselves to become more knowledgeable, and their directors push themselves individually to grow their own effectiveness and contributions to the board and the organization.

“The board needs to look at its own effectiveness and contribution, and ensure it is continually improving and changing with growth and change in the organization,” says Leslie. “Sometimes an organization can perform well for a few years, but that doesn’t mean the board is operating in excellence. The board deciding to simply ‘getting out of the way’ of management isn’t excellence in governance.”

When a board focuses its attention on forward-looking thinking and long-term strategy, it encourages the management team to do the same, providing amplified benefit to the organization. Board excellence delivers other significant benefits, as well. A well-run board that, through its oversight of management, leads to a well-run cooperative will be attractive to top-level employees: bright, talented employees want to work for a successful organization. In fact, top-tier candidates, especially at the CEO level, will ask questions about the board and how it functions.

The cooperative will also be more attractive to potential customers and open
opportunities for strategic alliances.

“Much of excellence in the boardroom is process related, in terms of best practices in communication, meeting management and other key functions,” says Jay Lux, Vice President of Leadership and Organizational Development. “The bigger part is ensuring the board is undertaking the right kinds of discussions in the boardroom, focusing on strategic conversations rather than falling into the trap of diving into operational tactics.”

Board excellence becomes especially critical in times of turmoil or disruption. Crises can derail the best-run organizations, but a commitment to strong governance prepares the board to respond and support management so the organization can continue to thrive.

For more information on how FCCS can support your governance excellence,
including consultation, board education and facilitation and board or peer evaluations, contact Leslie Hilton, Vice President of Governance/Board Development, at 720.951.2999 or via email.

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