When the going gets tough, co-op directors must work even harder

THE role, responsibility and performance of co-op board members have come sharply into focus.

It was inevitable that as the returns to dairy farmers came under pressure, and increasing costs eroded their profit margins, farmers would turn their thoughts to the decisions and performances of those who represent them at processing level.

A lot of board members give generously of their time for very little return, in order to represent their fellow farmers on the boards of processor co-ops.

But it wouldn’t be the first time their effectiveness was seriously questioned by farmers.

Many will argue that election to a co-op board often has more to do with one’s local popularity rating than capability to handle the responsibilities that go with this challenging position.

Others have sometimes been given the impression that attendance at co-op board meetings is no more than a social outing for some board members; but most are undoubtedly genuinely determined to do a good job and endeavour to represent the interest of the shareholders consistently.

Board members must remain conscious at all times that they control the co-op. This brings enormous responsibilities in the larger operations, and it is unavoidable that board members will come under pressure from various vested interests when big decisions must be made.

Shareholders and milk suppliers are becoming less tolerant of board members’ failings. For example, it is totally unacceptable for a board member to offer the excuse that they were unaware of a worsening financial situation in a co-op, because they did not get the information. Did they seek the information? Were they refused information asked for, even though every executive and every worker in the business is their employee, and is responsible to the board, as the governing body?

Board members should be aware that even more accountability will be demanded from them in the future by those whom they were elected to represent.

Farmers are under pressure and they will be more demanding of the performance of those who serve them, particularly in groups where farmers still have full control.