Your Board: Better than Rice Cakes?
added 02/06/08
-by Don Kreis, Board President_
Weary readers of the Co-op’s latest annual report may recall that it took me 2,000 words to explain why 2006 was such a great year for our organization. Such a pompous peroration left no room to describe the achievements of your Board over the past year. So, here’s the evidence for why the 71st Board of Directors, which concluded its work in April, might have been the best thing to hit the Co-op since the invention of the rice cake.
If you have ever served on a committee, you are almost certain to have had the experience of leaving a long meeting feeling as if your time had been wasted on a gathering full of sound and fury but, ultimately, signifying nothing. Almost without exception, a meeting of our Co-op’s Board is the opposite phenomenon.
Why this is so has its roots in the decision made several years ago to adopt a methodology, created by Atlanta-based organizational consultant John Carver, known as “Policy Governance.” Designed to maximize management discretion and focus boards on the big picture, Policy Governance essentially turns boards into legislative bodies, promulgating written policies to guide the folks who actually run the place. We do not purport to run it for them.
For board members, switching to Policy Governance is a bit like having Britons start driving on the right side of the road instead of the left. The transition is jarring and impossible to undertake gradually. People who find their way to the boards of food cooperatives typically arrive wanting to focus on current realities – parking problems, whether to continue selling cigarettes, how much rent we’re paying at Centerra Marketplace – that sort of stuff.
Carver challenges boards to spend as little time as possible on such matters and devote themselves to what he calls “ends” policies. As he admonished trustees in his 2002 book On Board Leadership, “Your organization does not exist for anything your staff is doing, no matter how well-intentioned, impressive, politically correct, or even righteous. It exists to make a difference.” Thus, in Policy Governance, an “ends” policy is an effort to describe that difference, for whom it is created, and at what cost.
It’s harder than it sounds, even for a 71-year-old
consumer-owned business with a heritage of fidelity to the storied Cooperative Principles.
In 2003-2004, the Board began this process of defining the cooperative’s desired ends by identifying seven stakeholder groups: members, non-member customers, our employees and their families, local suppliers, the local community, the larger cooperative community, and past and future generations of our members. In 2005-2006, the Board adopted this “global” ends statement: “The Hanover Consumer Cooperative Society exists to provide cooperative commerce for the greater good of our members and community.”
Most recently, the 2006-2007 Board added this statement of seven differences the Hanover Consumer Cooperative Society exists to provide:
1. The Upper Valley will have a retail source of food that is affordable, healthy, grown and/or processed locally to the fullest extent possible.
2. There will be economic value returned to the community via charitable contributions, outreach projects, patronage refunds to members, and other avenues.
3. Customers will be better educated about food issues and, as a result, make healthier choices than those who shop elsewhere.
4. There will be a vibrant cooperative sector in the economy, both nationally and regionally, and a local community educated in the value of cooperative principles and enterprises.
5. The cooperative’s bioregion will have a vibrant local agricultural community, and that community will, in turn, have a reliable retail market for its products.
6. There will be a major source of employment in the community that provides personal satisfaction to employees, livable wages, and financial security for employees and their families.
7. There will be a thriving business organization that protects and restores the environment.
These seven specific ends, as well as the global ends statement and the list of stakeholders, is not chiseled in the entablature. The idea is to refine them with regularity. Nor is the ends policy a group fantasy – it is an enumeration of objectives that management must address, and for which the Board holds management accountable.
Most boards are too chicken to undertake such an effort. An Upper Valley consultant who advises nonprofits confided in me a few months ago that she admires Policy Governance but wouldn’t dare recommend it to her clients. Doing this stuff right requires an earnest struggle on the part of each board member to overcome the natural tendency to focus on the trivial and the short-term. Our struggle, though ongoing, is succeeding.
What’s truly cool about all of this is the formal dialogue it touches off between board and management about whether the Co-op is achieving its ends, what evidence we can marshal to demonstrate it, and whether we need to revise the ends policy as the world evolves around us and as our insight (we hope) grows. The ultimate test of our success is the extent to which you, the membership, get caught up in the dialogue and conclude that your cooperative is making a real contribution to your welfare.
