The credit union democratic cooperative model is simple. The legal equality of each member’s voting role is intended to facilitate economic equality.
The intent of the one-person-one-vote in governance is that when accessing common resources, each member is on the same footing. If one person is better or worse off than another, that should not affect their ability to access credit.
In almost all other for-profit organizations, control is exercised by who holds the most shares, or through classes with special voting rights.
Member Rights
A credit unions’s bylaws is the primary document implementing member rights. NCUA’s bylaw description runs 45 pages. “The FCU Bylaws address a broad range of matters concerning a credit union’s organization and governance, the relationship of the credit union to its members, and the procedures and rules a credit union follows.”
But who ensures that the bylaws are followed, both in letter and spirit? Here is NCUA’s description of their role:
“The NCUA has discretion to take administrative actions when a credit union is not in compliance with its bylaws. If a potential violation is identified, the NCUA will carefully consider all of the facts and circumstances in deciding whether to take enforcement action. The NCUA will not generally take action against minor or technical violations, but emphasizes that it retains discretion to enforce the FCU Bylaws in appropriate cases, such as safety and soundness concerns or threats to fundamental, material credit union member rights.” (emphasis added)
What happens when the bylaw procedures for nomination and election are administered so as to form without substance? Or interpreted to enable incumbent directors to protect their positions and prerogatives?
A Live Case Study
Today, October 9, an actual situation will be discussed. The North Carolina Credit Union Commission will hold a special public meeting at 1:00 p.m. (dial in # (877)-402-9753, access code – 6601929.)
The primary purpose as published in the Notice:
“Discussion about concerns raised by a member of the public regarding recently approved changes to the State Employees’ Credit Union by-laws.”
This is how Jim Blaine sees the issue to be discussed in a recent post.
This will be another way the Annual Meeting and election of directors at SECU could have an impact far beyond this credit union’s circumstances.
The Annual meeting occurs tomorrow October 10th and will be lived stream.