What do the challenges and changes facing the credit union sector mean for managers, and directors who are not managers? And how do boards and executives work together to lead staff, volunteers and members as credit unions seek to adapt to new services and ways of operating?
These were the guiding questions for the Swoboda Research Centre’s credit union conference, held in Manchester last month.
Swoboda director Nick Money welcomed delegates and introduced leadership as the theme of the day, with a quote from John Carver: “Boards have to function as leaders, not just as watchdogs.”
Money added: “It’s not just about scrutiny and oversight, there’s a leadership role here. Setting a direction, sticking with it, taking tough decisions”. Many board members in the room will need to make decisions around big issues such as technology, said Money. “Those things are not easy, and you have to stick with it.”
The first keynote speaker of the day, Matt Fullbrook of Ground-up Governance, shared insights from his experience as a researcher with the University of Toronto, studying thousands of boards and sitting in more than 400 boardrooms over the course of twenty years.
Fullbrook highlighted the absence of clear answers to key questions such as “is there a causal link between governance and performance?”, “what do effective boards look like or do?” and “do CEOs matter?”.
He argued that “we need a reframe” of corporate governance, “since widely accepted definitions and concepts aren’t really helping”.
Fullbrook defined good governance as “intentionally cultivating effective conditions for making decisions in your corporation”. These “conditions” can include anything from information, to people, to physical environmental factors, such as the lighting and temperature in the boardroom. By this framing, argues Fullbrook, the credit union model can itself be considered a “condition”, because it affects how decisions are made.
Next, Central Co-op CEO Debbie Robinson offered her perspective head of a large retail co-op working with volunteer board members. Robinson stressed the importance of “servant leadership” and equipping boards with the information and support they need to perform effectively, including induction and training which embeds the co-operative values and principles.
Dr Peter Davis from the University of Leicester also highlighted the importance of co-operative values on boards, but warned that the movement does not have a recruitment strategy that reflects this as a priority.
Davis also spoke about the importance of membership engagement when it comes to governance.
“If you have members that are engaged in your credit union or your co-operative, governance will look after itself,” he said. “But do you get member engagement without leadership? Answer: No”.
Davis went on to describe the co-operative movement as “contested terrain”, stressing, “it’s not straightforward. [A co-op is] a political organisation. It mobilises people. That scares the hell out of those who don’t want the people mobilised.”
“If ever we needed social transformation, it’s now,” said Davis, outlining the context of climate change, growing poverty and food insecurity and calling for unity across the co-op movement and with others such as trade unions.
Later in the day, Miranda Flury of Hawkeye Strategies led a session around strategic questioning – asking questions intended to propel a credit union forward and maintain relevance – a key skill for board members.
Flury (main picture) highlighted the importance of assumptions and biases throughout her talk, encouraging everyone in the room to cultivate an awareness of their own perspective and beliefs when thinking strategically.
To foster strategic board culture, Flury advised board members to be curious and open-minded, be mindful of body language, nurture psychological safety, call out operational questions respectfully and seek training that helps to mitigate biases.
As a first step to becoming more strategic as a board, Flury recommended bringing a question such as “how can we best reinforce a strategic approach?”, to a meeting for the group to explore together.
The conference ended with a fireside conversation with a panel of credit union leaders, facilitated by Sallyanne Decker, associate professor in banking and finance at the University of Greenwich.
Marlene Shiels spoke about her experience as CEO of Capital Credit Union, highlighting the common bond requirement as a key challenge for the credit union sector at the moment. “Every credit union person I talk to has an issue around the common bond, whether it’s anti-competitive, whether it’s slowing us down, whether it’s the reason that we can’t grow the way we want to.”
Shiels urged everybody in the room to respond to the government’s call for evidence on this issue, “to make sure that we get a common bond that is fit for the future of the British credit union system”.
Paul Norgrove, CEO of Serve & Protect Credit Union and president of the Association of British Credit Unions, pointed to technology, including the development of AI, as a key issue for the movement, as well as recruitment of new leaders being crucial “as we start to lose our founders”.
Sheila Nunan, director and former chair of Comhar Linn INTO Credit Union, also emphasised the importance of technology when it comes to growing the membership and engaging with younger generations, as well as taking every opportunity to gather feedback and act on it.
Some of the opportunities discussed by the panel included education, including the Credit Union Development Educator programme, to nurture leaders in the credit union movement, as well as greater collaboration through credit union service organisations (CUSOs).
CUSOs are not just a matter of scale and collaboration, said Norgrove: they serve the fundamental purpose of the movement. “It frees us up to keep doing what we’re really good at, which is serving our members, and ultimately, we can establish a mature CUSO market, like the United States and North America more broadly”.
Another key theme of the discussion was how to get the word out about credit unions and stop being a “well-kept secret”.
“We’re good at telling people we do savings, loans and mortgages – but yeah, so does every bank on the high street”, said Shiels.
She stressed that it is instead “the stories, the difference that we make in people’s lives, the changing members’ lives, one member at a time”, that needs to be shared to grow and sustain the movement.
The next Swoboda research conference will take place in Dublin on 23 May 2025.
