Leadership

Leveling Up as a Cooperative Leader

An illustration of many interconnected gears in shades of blue with business related icons in the center, such as a light bulb, people, and clipboard.

The job description and responsibilities of a cooperative director are varied – from establishing policies, representing members, and assessing the cooperative’s performance, to hiring, supervising, and succession planning for the cooperative’s key manager, among many others. Whether a start-up cooperative is building their board, or a longtime director is taking on a new leadership role on their board, directors may be asking themselves, “What skills do I need to lead my co-op effectively?”

Vital Skills for Cooperative Directors

In research using prior literature, interviews, and focus groups with cooperative CEOs/general managers, directors, and service providers of farmer cooperatives in Kansas, researchers identified 11 key skills as necessary to be an “engaged and knowledgeable director,” including:

  1. Cooperative finance
  2. Cooperative governance and policy
  3. Communication
  4. Time management
  5. Understanding current economic and industry conditions
  6. Asking critical and constructive questions
  7. Strategic planning
  8. Networking
  9. Listening
  10. Teamwork; and
  11. Leadership[1]

When asked about the “duties, expectations, and strengths of successful directors,” cooperative board chairs and managers in Texas shared some of the following expectations of directors:

  • “Come prepared to give your full attention during board meetings.”
  • “Train and educate yourself to have an understanding of the audit and financial statements.”
  • “Stay current and aware of the status of co-op operations…”
  • “Work at being open to change and new ways of doing business.”
  • “Have an understanding of director versus general manager roles – both limitations and responsibilities.”[2]

Understanding your Skills

One way directors can build their leadership capacity is to identify skills where they excel and other skills where they would benefit from continued training and growth. However, some cooperative experts have cautioned that board assessments should be used with caution and in conjunction with additional training and development to avoid overwhelming, discouraging, or disengaging directors.[3]

The U.S. Department of Agriculture’s “Assessing Performance Needs of Cooperative Boards of Directors,” published a self-assessment tool for cooperative directors that includes seven areas related to cooperative directors’ responsibilities and duties.

Scholars from Texas A&M University developed a framework for cooperative governance based on concepts of personal, board, and organizational development where governance includes influence over self, influence over other individuals and the board, and influence over the cooperative organization.[4] The researchers developed a tool for directors to assess their own competencies in related to leadership in their cooperative called the Multidimensional Governance Assessment.

Resources for Growing Directors’ Skills

Many cooperative boards already provide training for their directors.[5] Regular board training programs may be built directly into regular meetings or as special programs focused on specific areas or skills. The source of expertise can be as varied as the training topics, from internal cooperative employees to partners from federated cooperatives to nonprofit and university educators.

Individually, directors may prefer to learn on their own through reading, live trainings, or connecting with peers. Directors can ask their co-op’s leadership whether they are aware of or partner with cooperative educators, or if they regularly use recommended training materials. Below are a few places where cooperative stakeholders can explore governance training.

Literature Cited

[1] Herchenbach, J., Briggeman, B., Bergtold, J., Shanoyan, A., Low, S. & Miller, B. (2023). “A qualitative assessment of farmer director skills in agricultural cooperatives.” International Food and Agribusiness Management Review. Advance online publication. DOI: 10.22434/IFAMR2022.0099

[2] Engelke, T. & Park, J. (Sept. 2008). How to Rise Above the Crowd. Cooperative Management Letter, Texas A&M University. https://agecoext.tamu.edu/wp-content/uploads/2013/08/cml0803RiseAboveCrowd.pdf

[3] Jacobs, K. & Fagerlin, R. (2024). Board Assessments: The Importance and Value of Board Assessments [presentation]. National Council of Farmer Cooperatives Director Education Conference.

[4] Park, J. Friend, D., McKee, G., & Manley, M. (2019). “A Framework for Training and Assessment of the 21st Century Cooperative.” Western Economics Forum, 17(2), 5-15.

[5] Berner, C. & Schlachter, L.H. (2022). “Findings from the Cooperative Governance Research Initiative: 2021.” University of Wisconsin-Madison Center for Cooperatives. https://resources.uwcc.wisc.edu/Research/CGRI_2021Report_web.pdf

Leading the Co-op: Director Key Responsibilities and Board Training Programs

One of the unique aspects of the cooperative business model is that members democratically control the enterprise.[1] Commonly, cooperative members elect a representative board of directors to govern the business.

Cooperative directors are tasked with varied and sometimes complex tasks, from monitoring financial performance to assessing the co-op’s general manager and more. In serving in a vital role in their cooperative, directors also take on various responsibilities – some of them legal in nature. Key among these responsibilities are the fiduciary duties directors owe to members, other directors, and the cooperative.[2]

  • Duty of care – Generally, requires that cooperative directors use care in their actions as judged based on the care that an ordinarily prudent person in a similar position would exercise. Directors are generally expected to make informed decisions, exercise reasoned judgement, and adequately supervise those to whom they delegate responsibilities.[3]
  • Duty of loyalty – Generally, requires that cooperative directors act in good faith and for the benefit of the cooperative, including not receiving preferential treatment compared to other members and appropriately addressing or avoiding conflicts of interest.[4]
  • Duty of obedience – Generally, requires that cooperative directors comply with applicable laws and authorities. It is important for directors to be generally familiar with key authorities like the co-op’s bylaws, articles of incorporation, policies, and other key legal instruments.[5]

A deeper dive into the legal responsibilities of agricultural cooperative directors, “Navigating Your Legal Duties: A Guide for Agricultural Cooperative Directors,” is intended as a practical resource for directors that includes self-assessment tools to help directors identify areas where they can learn more. The resource is published by the National Agricultural Law Center.

For a wider-view of the types of responsibilities that directors take on in leading their cooperative, “The Circle of Responsibilities for Co-op Boards,” by James Baarda is a helpful publication.

Tan office chairs around circular meeting table

Most Cooperatives Provide Board Training in Key Responsibilities

Cooperative board training programs can help directors understand their roles and responsibilities, including ensuring that new directors, and even seasoned directors, have a firm grasp of their fiduciary duties, among other areas. In a survey of 500 cooperatives across industry sectors and the United States, co-op enterprises shared the topics in which they train directors:

  • 80% or more of responding cooperatives train board members in fiduciary duties, financial topics, and the cooperative model
  • Many cooperatives, between 53% and 78% of responding cooperatives train directors in ethics and compliance, industry-specific topics, legal and regulatory issues, and risk management
  • Almost half of responding cooperatives (49%) train directors in corporate social responsibility/sustainability/social impact
  • Some responding cooperatives train their directors in meeting facilitation and conflict resolution – 41% and 32%, respectively[6]

Training is a Key Part of Global Co-op Principles

According to the globally-recognized cooperative principles stewarded by the International Cooperative Alliance (ICA), Principle 5: Education, Training and Information recognizes that, “Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their co-operatives. . .”[7] The ICA’s Guidance Notes on the Cooperative Principles clarify what might seem like a redundant phrasing – education, training, and information have distinct, important meanings:

“ ‘Education’ is about understanding the Co-operative Principles and Values and knowing how to apply them in the day-to-day operations of a co-operative business…”

“ ‘Training’ is about developing the practical skills members and employees need to run a co-operative in according with efficient and ethical business practices and to democratically control their co-operative business responsibly and transparently.”

“ ‘Information’ is a duty to make sure that others who are members of the general public . . . know about co-operative enterprise.” [8]

Graphic of light colored light bulb and hands connecting colored puzzle pieces

A Commitment to Continued Learning: Developing a Board Training Program

As directors navigate complex business landscapes trying to ensure their cooperative enterprise is responsive to members’ needs and remain sustainable over the long-term, training programs can help directors develop their technical and soft skills. To develop a board training program, cooperatives may look both internally and externally. For example, training programs may be specifically constructed and hosted by a local cooperative’s key employees or by a federated cooperative partner. Various education and nonprofit institutions that work with or support cooperative enterprises like councils, cooperative associations, and universities that offer generalized training opportunities and educational resources. Further, industry-based associations, like agribusiness, housing, or financial industry associations, often host learning sessions, updates, and professional development opportunities.

As cooperative managers, directors, entrepreneurs, and developers look toward a new calendar year, prioritizing training that can help directors lead their co-op more effectively may be a worthy goal to add to the list of resolutions!

Important note: This information is provided for educational purposes only. It is not legal advice and is not a substitute for the need to consult with an appropriately licensed attorney.

 

Sources

[1] “Cooperative identity, values & principles.” (2018).  International Cooperative Alliance. https://www.ica.coop/en/cooperatives/cooperative-identity

[2] Scott, H. & Traxinger, M. E. (2021). “Navigating Your Legal Duties: A Guide for Agricultural Cooperative Directors.” National Agricultural Law Center. https://nalcpro.wpenginepowered.com/wp-content/uploads//assets/articles/Co-op-directors-guide.pdf

[3] Id.

[4] Id.

[5] Id.

[6] Berner, C. & Schlachter, L.H. (2022). “Findings from the Cooperative Governance Research Initiative: 2021.” University of Wisconsin-Madison Center for Cooperatives, 31. https://resources.uwcc.wisc.edu/Research/CGRI_2021Report_web.pdf

[7] “Cooperative identity, values & principles.” (2018).  International Cooperative Alliance. https://www.ica.coop/en/cooperatives/cooperative-identity

[8] “Guidance Notes on the Cooperative Principles.” (2017). International Cooperative Alliance, 59. https://ica.coop/en/media/library/the-guidance-notes-on-the-co-operative-principles

Cooperative “Difference” Creates Opportunity for Shared Management Approach

Chris Sigurdson has worked in the dairy and beef industries for over 30 years. Today, he jokes that he has more than 20 bosses, literally. Sigurdson is the general manager/CEO of both COBA/Select Sires Inc. and Minnesota Select Sires Co-op, Inc. In late 2021, Sigurdson began leading the two farmer-owned cooperatives in a shared role meant to help the companies boost members’ value and continue meeting the changing needs of dairy and beef producers across the United States  and in Mexico.

Context Lays Groundwork for Shared Management Approach

As bovine genetics companies, Minnesota Select Sires Co-op, Inc., and COBA/Select Sires Inc. have faced evolving marketplaces in their decades of operation, including substantial consolidation of dairy farms, technological and genetic innovations, and increases in operating costs. In particular, changes in the dairy industry have had important impacts on the two cooperatives –  a high proportion of production dairies in the United States use artificial insemination for breeding.

COBA/Select Sires Inc. and Minnesota/Select Sires Co-op, Inc. are both members of the federated cooperative, Select Sires, Inc. headquartered in Plain City, Ohio, and owned by six farmer-owned cooperatives. In 2021, Select Sires, Inc. members considered a proposal to unify the federation into a single cooperative that did not ultimately move forward. However, having a shared background as members in a cooperative federation, being similarly structured as farmer-owned cooperatives, sharing a desire to continue serving farmer-owners, and with COBA/Select Sires planning for the retirement of their general manager, the two boards decided to move forward with a shared general manager/CEO position in late 2021. COBA/Select Sires, Inc. is governed by a 15-member board, while Minnesota Select Sires Co-op, Inc. is governed by a nine-member board.

Shared Resource Opportunities May Create Efficiencies

COBA/Select Sires serves farmers in Ohio, Oklahoma, Texas, New Mexico, Arizona, Mexico, and portions of Indiana, Pennsylvania, and West Virginia, while Minnesota/Select Sires’ service territory includes Minnesota and North Dakota. The two companies have a combined portfolio of $53 million in business and more than 170 employees. In addition to his own leadership position, Sigurdson cites shared resource opportunities like leveraging marketing communications across companies, creating career pipelines and potential connections to new talent, and potential operational opportunities in shipping, storage, and business systems, among others, that might help the two cooperatives reach their goal of effectively serving farmer-members while lowering expenses per unit sold.

Multiple blue gears with various business related graphics inside, such as a light bulb, people, and target.

Sigurdson Shares Approach at Online Cooperative Roundtable

Sigurdson spoke about the reasons for the shared management approach, his role, and opportunities for additional resource sharing among the two companies to cooperative stakeholders during a recent online “Cooperative Roundtable” hosted by the CFAES Center for Cooperatives at Ohio State in partnership with the Mid America Cooperative Council (MACC).

Cooperative Roundtables are online learning opportunities hosted by the CFAES Center for Cooperatives and MACC as opportunities to learn from industry experts about current issues facing the cooperative community. Past roundtable topics have included strategic talent planning, cybersecurity in agribusiness, and recognizing diversity and inclusion among co-op members, among other topics. Sign up for the CFAES Center for Cooperatives email list to receive information about future Cooperative Roundtables.

Appalachia Cooperates Grows Co-op Culture

Q: How can Extension professionals, business and community developers build a brighter future, robust local economies, and living wage job opportunities in Appalachia?​

A: Worker-ownership.​

Worker-owned cooperatives, defined by two advocates of the model as, “values-driven businesses that put worker and community benefit at the core of their purpose . . . [in which] workers participate in the profits, oversight, and, to varying degrees, the management of the organization, using democratic practices,” (Hoover & Abell 2016).​

The Center for Cooperatives and partners are growing co-op culture in Appalachia! Join us on March 22, 2019 at West Virginia State University Economic Development Center in Charleston.

Check back soon for registration details!

References

Hoover, M. & Abell, H. (2016). The Cooperative Growth Ecosystem: Inclusive Economic Development in Action. Project Equity and the Democracy at Work Institute.

YAP Conference to Educate, Empower and Encourage the Next Generation

The future of farming is just over the horizon. Are young farmers prepared to fill their predecessors’ boots? Do they have what it takes to conquer challenges facing the agricultural industry? Are they confident to lead themselves and others?

The Ohio Farm Bureau Federation’s annual Young Agricultural Professionals Winter Leadership Experience will take place February 3-4, 2018, in Columbus, Ohio. 650 Young farmers from across Ohio are registered to attend the 2-day event.

“The YAP Winter Leadership Conference is where young farmers and Ag professionals can professionally and personally grow by attending a variety of educational breakout sessions,” said Melinda Witten, Ohio Farm Bureau Director of Leadership Programming. “It is a place to connect and build a community with folks who have shared experiences.”

The upcoming conference offers a wide variety of programming to educate, empower and encourage the next generation of Ohio farmers.

Educate

The Winter Leadership Experience prepares future farmers with knowledge and skills to build a farm business or successful career in Ag. Industry experts and educators will offer workshops in business and financial planning, strategies to manage risk and comply with regulations.

Marketing workshops will teach young farmers how to effectively position and sell their farm products. Attendees will learn how to find and communicate with consumers. Video and social media workshops will instruct young farmers how to harness the power of digital marketing to grow their agribusinesses.

Empower

The YAP Winter Leadership Experience empowers young farmers with confidence to lead. A compelling Discussion Meet Competition will showcase young agriculturalists in a dialog over issues impacting the agriculture industry. The winner of the Discussion Meet will receive a $1,000 cash award from Nationwide Insurance.

A panel of Ohio Farm Bureau Federation leadership featuring Farm Bureau’s OFB President Frank Burkett and Vice President Adam Sharp and will share their vision for the Farm Bureau’s future in an interactive session with young farmers. Additional workshops in conflict and human resource management will offer tools for young farmers can use to effectively lead themselves and others.

Encourage

Networking at the Winter Leadership Conference creates meaningful connections. Young farmers will enjoy fellowship other farmers, explore potential partnerships, and meet mentors and business advisors.

On Saturday, The Ohio State University CFAES Center for Cooperatives will present a panel of grant experts from university, government and private organizations. The Agricultural Grant Opportunities Workshop will encourage attendees to utilize federal, state and private grant programs to develop value-added products, accomplish on-farm research and make conservation improvements.

Don’t forget the funYAP 2017

The Winter Leadership Conference has something for everyone. Fun workshops will teach attendees how to preserve food, make soap and prep for healthy meals. The conference kicks-off with Friday night food, games and entertainment featuring Big Bang Dueling Pianos.

Details about the upcoming conference are on the Ohio Farm Bureau website, https://ofbf.org/yap-winter-leadership-experience

Article originally published in Farm & Dairy Newspaper

https://www.farmanddairy.com/top-stories/yap-conference-to-educate-empower-and-encourage-the-next-generation/467557.html

Cooperative Leadership Forum Offers a Valuable Learning Opportunity

The Mid America Cooperative Council (MACC), an organization representing over 100 cooperatives in Ohio, Indiana, Illinois, and Michigan, is offering a unique leadership training for co-op employees, board members, and other prospective leaders. The sessions on February 21-22 and March 6-7 in Oxford, Ohio will include tours of successful cooperatives in various sectors, sessions on leadership and management, and talks with cooperative leaders from across Ohio, among other activities.

MACC Executive Director, Rod Kelsay, talks with forum participants about how to develop their personal leadership skills.

In 2016, staff members of the OSU South Centers had the opportunity to participate in the forum, which included tours of Butler Rural Electric Cooperative, Inc. and CHACO Credit Union as well as visits from representatives of Miami University Credit Union, Dairy Farmers of America, and COBA/Select Sires. The various speakers shared how their co-ops benefit members, how they are governed, and the services they provide to members. Each highlighted their “cooperative difference,” including their prioritization of members’ needs, education efforts, and concern for community. OSU South Centers’ Kimberly Roush, explained the inspiration she gathered from visits to local co-ops. “I noticed an interesting result of the cooperative environment during the leadership forum—the overall culture of the cooperative employees who spoke with us.  The staff explained specific details about the reason for and the function of their cooperatives. Then they shared something more—talking about member activities and interaction with the community.  It was exciting to learn how the cooperative principles permeate the local culture.”    

Not only did staff learn a great deal from various guest speakers, the forum was an opportunity to network with and learn from other participants who worked across various sectors like credit unions and agricultural marketing and supply co-ops.

To learn more about the 2018 Cooperative Leadership Forum, visit http://editor.des08.com/macc/Brochure_CLF_2018.pdf. Contact MACC with any questions at (317)-726-6910 or knowledge@macc.coop.