RIVER VALLEY CO-OP BOARD GOVERNANCE POLICIES

THE WAY YOUR CO-OP BOARD FUNCTIONS

River Valley Co-op's Board of Directors is the elected governing body empowered to represent the Co-op ownership's interest in the management and governance of our cooperative business. To accomplish this trustee/leadership responsibility the Board has established policies that guide its work including its internal processes, the overall vision and strategic planning for the Co-op's purpose and resulting impacts, direction and delegation to management, management accountability and the overall working relationship between the Board and management. 

INTRODUCTION

The Board's policies are structured based on the governance model originally developed by John Carver, (www.carvergovernance.com), called Policy Governance. It is a system of governance that has been adapted and evolved in its use by food co-ops over many years. It is considered a best practice among food cooperatives for organizing the work of the Board to effectively lead cooperative businesses on behalf of their co-op owners, delegate responsibility to management, hold management accountable, and be accountable to the co-op ownership for fiduciary responsibility and progress in meeting the mission of the co-op. In addition to meeting our fiduciary duties and ensuring accountability, the Board incorporates best practices in co-op governance that provide for strategic leadership, empowered accountable management, foster democratic ownership, and perpetuate Board excellence. The Board Policies are a key tool for the Board of Directors to accomplish its overall work.

What is the work of the Board?

Board leadership requires, above all, that the Board provide vision. To do so, the Board must first have an adequate vision of its own job. That role is best conceived neither as management’s volunteer-helper nor as watchdog, but as trustee-owner. The system the Co-op has adopted in its job of governing is one that emphasizes more than fiduciary responsibility and includes cooperative values, empowerment of Board, staff, co-op owners, teamwork, strategic leadership and vision.

The Bylaws of the Co-op provide the overarching job description of the Board:

The powers and duties of the Board shall include, but not be limited to: engaging and monitoring the performance of a general manager, overseeing the operations of the Co-op, approving budgets and fiscal controls, setting membership policies, securing good conditions of employment and assuring that the purpose and principles of the Co-op are properly carried out. (section 4.1).

To accomplish its job, the Board has adopted an approach that considers four key aspects of governance. Teaming, accountable empowerment, democracy and strategic leadership– these are key components of the Board’s work.

Teaming, the first aspect is the ability to successfully work together to achieve our common purpose.  We have described our goals and standards for the Board’s internal structure, roles, and relationships through our Board Process policies. The goal of these policies is to perpetuate board excellence. We also recognize the importance of teamwork between the Board and General Manager and have policies that outline that structure for this relationship and the respective roles and standards.

A second aspect is accountable empowerment:  successfully empowering people while at the same time holding them accountable for the power granted. Board Policies that focus on Executive Limitations set the standards and goals for management accountability. Board Policies that focus on the “Ends” establish the mission and results that management is charged with achieving. Board process and Board/Management relationship policies establish how the Board holds itself accountable in its internal working procedures and relationships. There is a system for monitoring all policies regularly to ensure accountability. (See more below)

A third aspect is democracy. If there is one thing that distinguishes the Co-op from other grocers, it is that we are democratically owned and controlled by the community. The Board must successfully practice, protect, promote, and perpetuate this hallmark of our existence. The Board supports Co-op owner participation in the Co-op through annual meetings and elections, owner surveys, special events, conversational forums, and more.  Five minutes are allotted for co-op owner comments at the beginning of regular board meetings and members may request agenda time by contacting the Board President at least two weeks in advance of the meeting. All these avenues of owner feedback and participation help ensure openness and stimulate review and reflection of our policies. In keeping with accountable empowerment, when the Board receives input, questions or concerns that relate to co-op store operations, we include the General Manager in the process.

The fourth and final aspect is strategic leadership. The Board’s job is to successfully articulate the Co-op’s direction and purpose and then ensure the Co-op is positioned for movement in this direction.  As elected representatives of the Co-op owners, the Board is always learning, gathering knowledge, industry and marketplace research and insights, and owner feedback to bring the best of our collective selves to our decision-making on behalf of Co-op owners.

Our governing style emphasizes:

  • teamwork among Board Members and with the General Manager,
  • accountable empowerment of directors and management to ensure fiduciary responsibility and adherence to co-op standards and goals,
  • democracy and communication with our co-op owners to ensure alignment of the cooperative and its ownership on its mission, plans, and goals, as well as
  • strategic leadership to ensure the cooperative remains viable in the marketplace and progresses on its mission to achieve the results desired for the benefit of the co-op owners/community.

The Board focuses primarily on intended long-term impacts rather than the operational means of attaining those effects. To accomplish this, the board directs, controls and inspires the organization through the establishment of a comprehensive set of governing Board Policies. Board Policies, developed over many years and by many board members, are carefully adhered to and regularly monitored as a key component of our co-op’s system of accountable empowerment.

  1. ENDS POLICIES

The Co-op mission to create a just marketplace that nourishes the community is defined in our “Ends” Policy. River Valley Co-op is not just a natural foods store that promotes local purchasing and healthy communities; as a co-op we also have another responsibility to monitor what is commonly called a “triple bottom line” or the “three P’s: People, Planet, and Profit.” This means that we are in business for the achievement of the co-op owner/community benefits embodied in our mission including social impacts, environmental stewardship, and financial sustainability resulting from our business operations.  Through the Ends Policy, the Board defines which needs are to be met, for whom, and at what cost. Written with a long-term perspective, these mission-related policies embody most of the Board’s part of the long-range planning; the General Manager reports to the Board annually on how she/he is accomplishing the business impacts and results outlined in this policy. Additionally the General Manager reports on business planning annually which includes reporting on how the plan will support progress in achieving our mission/Ends Policy.

  1. EXECUTIVE LIMITATIONS POLICIES

The Board establishes the boundaries of acceptability within which the General Manager has to work. These limitations are written as negative statements which, so long as the General Manager can justify his/her interpretations and actions under these limitations, allow the General Manger and her/his team, to operate with efficiency and independence.   The Board reaches an agreement with the General Manager on the frequency of her/his reporting on each of these policies (generally quarterly or annually). Each report is received at least one week before the Board meeting and the discussion at the Board meeting centers on how the General Manager is interpreting the policy and then whether there is sufficient supporting data and evidence to support the interpretation. These reports, and the subsequent Board discussion and the votes on whether to accept them are the basis for the annual evaluation of the General Manager.

Additional policies governing the board-general manager relationship and board processes may be found in the complete current set of Board policies that you may download here.

Additional readings on Policy Governance, a system to run boards of companies or non-profit organizations created by John Carver. From the shortest to the longest:
http://www.carvergovernance.com/model.htm
http://archive.uua.org/ga/ga00/217.html
http://www.carvergovernance.com/pg-np.htm