The Way Your Co-op Board Functions

The co-op Board of Directors represents the member-owners' interests in the operation of the store and the broader vision of the Cooperative. The River Valley Market Board of Directors decided in 2001, guided by our development consultants at the Cooperative Development Services, to use the Policy Governance Model to structure their activities and dictate how they relate to the General Manager and the member owners. This section provides some general information about how we use this model to the greatest benefit of the Cooperative.

Introduction

Policy Governance is a model developed by John Carver.   You can learn more about it at: www.carvergovernance.com .  Many food co-ops have moved to this system of governance, as it is a helpful structure to balance representing member-owner views with allowing the professional staff of stores to fulfill member-owner wishes without micromanagement.

What is the work of the Board?

To quote the Board’s policies related to defining its work:

“The purpose of the Board, on behalf of the Cooperative Member-Owners, is to act as trustees of the Members’ ownership in the Cooperative, to ensure that the Cooperative accomplishes its Ends policies, and to ensure that the Cooperative does not fail to comply with Executive Limitations and Board-General Manager Relationship policies, in accordance with the principles set forth by the International Cooperative Alliance. The Board will specify its expectations through written Ends Policies.”

Our governing style emphasizes strategic leadership and a clear distinction between Board and General Manager duties. 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 the broadest organizational values and policies. Policies, developed over many years and by many board members, are carefully adhered to and monitored. Time is allotted for member input at regular board meetings to ensure openness and stimulate review and reflection of our policies. When we receive input, questions or concerns that relate to Co-op operations, we ask that the General Manager respond.

Honesty, openness, and member input – these are key cooperative values and principles that guide the Board.

What is the Policy Governance Model?

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 volunteer-helper nor as watchdog but as trustee-owner. Policy Governance is an approach to the job of governing that emphasizes values, vision, empowerment of both Board and staff, and the strategic ability to lead.

Observing the principles of the Policy Governance model, the Board spent many months crafting its values into policies of the four types summarized below. Policies written this way enable the Board to focus its values into one central, brief, document. The Board is continually assessing the relevancy of its policies and how effective they are at achieving the goals of the Cooperative.

1. Ends Policies

River Valley Market is not just a natural foods store that promotes local purchasing and healthy communities; as a Cooperative we also have another responsibility to monitor what is commonly called a “triple bottom line.” This means that we are in business to be profitable, follow excellent environmental and social practices and fulfill the mission that is embodied in our Ends policy. Through this 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 long-range planning and the General Manager reports to the Board annually on how she/he is accomplishing this policy.

2. 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 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 to support the interpretation. These reports and the subsequent Board discussion and votes on whether to accept them are the basis for the annual evaluation of the General Manager.

B POLICIES: EXECUTIVE LIMITATIONS

Global: The General Manager shall not cause or allow any practice, activity, decision, or organizational circumstance that is unlawful, imprudent, or in violation of commonly accepted business and professional ethics and practices, or in violation of the Cooperative Principles.

3. Board-Executive Linkage Policies

These policies are used by the Board to clarify the manner in which it delegates authority to the General Manager as well as how it evaluates his/her performance in interpreting and accomplishing the provisions of the Ends and Executive Limitations policies. They provide clear guidance on what the general manger expects of the Board and what the Board, on behalf of the membership, expects from the General Manager.

C POLICIES: BOARD-GENERAL MANAGER RELATIONSHIP

Global: The Board’s sole official connection to the operational organization (the store), its achievements, and its conduct will be through the General Manager.

4. Board Process Policies

The Board determines its philosophy, its accountability, and specifics of its own job.

D POLICIES: BOARD PROCESS

Global: The purpose of the Board, on behalf of the Cooperative Member-owners, is to act as trustees of the Members’ ownership in the Cooperative, to ensure that the Cooperative accomplishes its Ends policies, and to ensure that the Cooperative does not fail to comply with Executive Limitations and Board-General Manager Relationship policies, in accordance with the principles set forth by the International Cooperative Alliance. The Board will specify its expectations through written Ends Policies.

You may download a copy of the complete current Board policies here, or request a paper copy at the Customer Service Desk in the store.