Roles and Responsibilities of the Board of Directors (1st of 2)

This is the first of two posts that cover the roles, responsibilities, actions and operations of a Coop Board of Directors. Today we focus on new Board members, and the role of the Board of Directors.

Nearly every year, new members are elected to Boards of Directors. This may occur at the annual meeting or it may occur by appointment to fill a vacancy. We tell these newest volunteers “Congratulations and Welcome aboard!” But, we also need to tell them what their new role is all about.

Where to Begin?

The Managing Agent should provide each Board member with the Corporation’s governing documents including: the latest minutes, financials, and other pertinent information. A new member’s first responsibility is to familiarize himself with the governing documents that specify the Board’s scope of authority and responsibility.

The Board of Directors’ role is to:

  • Govern the Coop
  • Establish policies and rules
  • Ensure financial and administrative records are correct and current
  • Maintain the common elements
  • Promote a quality community environment for all residents

Each Director owes every shareholder the obligation to be careful with the Coop’s assets placed in the Board’s trust. This is a higher duty that calls for the elected Director to place his or her personal benefit second to that of the Coop. This means that the Director ensures that interests of the Coop come first.

It doesn’t mean hoarding reserves if maintenance is necessary, or automatically choosing the “cheapest” contractor. It doesn’t mean neglect of the buildings in order to keep the maintenance fee down to win friends and re-election.

It does mean standing up against the pressures of special interest groups in order to protect the Coop as a whole. It does mean taking the time to carefully consider a variety of approaches to each question brought before the Board.

Next up, we will discuss the action and operations of Coop Boards.

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