Co-operatives UK reveals recommendations for agricultural co-operatives to address Board diversity and implement succession policies following a director renumeration survey.
Key good governance findings and recommendations for agricultural co-ops have been revealed following a Board and director remuneration survey.
Co-operatives UK, in partnership with Scottish Agricultural Organisation Society (SAOS), conducted the survey in autumn 2023 to establish current practices and trends around director fees and expenses.
Director recruitment is a critical component of a business’ continued success, and the remuneration package is a key component in attracting the best directors to the board. The findings support and inform agricultural co-ops in their decision-making process around the remuneration of non-executive directors alongside providing recommendations around succession and diversity.
Highlights from the report:
- Director remuneration is wide-ranging, with a significant correlation being made between size of business and fees paid to directors
- Women are under-represented on agricultural co-operative boards. The survey does, however, show a significant increase in the number of boards with a woman director when compared to the 2017 survey
- Less than half of surveyed businesses have a board succession policy in place. Finding the quality and calibre of directors to ensure a long prosperous future is vital and should be a higher priority
- Board diversity is poor and requires addressing to promote richer discussions and improved decision-making through the inclusion of people with varied perspectives, skills, ages, genders, cultures, and ethnicities
Report: Director fees in agricultural co-operatives 2023
Richard Self, Agricultural Manager at Co-operatives UK, said: "Board performance is a key aspect of the success of a co-operative business. Board diversity - in thought and protected characteristics - is a key component within that as different skills and ways of doing things leads to richer discussions and improved decision-making.
"Therefore recruiting and retaining the best possible directors and supporting them with best practice governance procedures are critical issues for the business to get right. We believe this report will help UK farmer co‑operatives with the continuous improvement of their governance."
Anna Delday, SAOS Co-op Development Manager said: “Rewarding directors for their time and commitment to ensuring the business they are representing is successful is arguably one of the most important conversations a Board will have each year.
"We hope the findings will support conversations around the appropriate reward process for directors, to attract, motivate and retain individuals and reward them for time away from their core farming business. Finally, but importantly, we we'd like to thank the co-ops who took the time to support us in gathering the information."