What Co-op Directors Do

Cooperatives usually have too many owners for all of them to participate often in helping make business decisions So the owners elect a few people who they feel can best make most decisions for them. This leadership group is called the board of directors.

The board of directors, most importantly, functions to direct the business affairs of the cooperative. It is the cooperative's central decision center. In carrying out this responsibility, however, the board performs several important supporting roles. It is a listening post, hearing from management and membership. It is a communications hub, imparting information between members and management. It is an advisory body to members and management, providing recommendations and guidance. But in every role and action, the board is accountable to members.

The cooperative's bylaws determine the nature and composition of the board through written provisions describing director eligibility, method of selection, term of office, and board organization. A typical board will have seven to nine members. To function in an organized manner, directors elect from among themselves a chairman, vice chairman, secretary, and treasurer. These officers are sometimes designated as the executive committee, which in larger boards may include one or more additional directors. Other board committees may be formed to assign oversight of particularly important aspects of the cooperative, such as finance or member and public relations.

Meetings are held on a set frequency, often monthly, with predetermined dates desirable. An agenda is developed. Minutes are kept. A nominal amount of compensation may be provided, usually to cover directors' expenses to attend board meetings.