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Co-operatives and elections

Stage 4: Eligibility to stand for election

Ineligible candidates

Every co-operative should have in its rules a clear statement of the circumstances in which an individual will not be able to serve as a director.

Some of these circumstances are prescribed by law; a person may not legally be a director of a co-operative if:

  • They are an undischarged bankrupt
  • They have been disqualified from acting as a company director

Many sets of rules will also prevent someone who has been disqualified from acting as a charity trustee from becoming a co-operative director. Where a community benefit society is charitable, this will be an automatic bar.

Other criteria for eligibility

Often, the rules will set out other circumstances or criteria which would prevent someone from serving on the board. These can include:

  • A minimum period of membership: There is no recommended set period in the Code, but this can vary from a few months up to a typical maximum of two years.
  • A trading or participation condition with the co-operative: Especially for retail societies. For other co-operatives, having a trading relationship will be a pre-requisite of membership (housing co-operatives, for example).
  • Not having been previously dismissed from employment with the co-operative for reasons other than redundancy (the authors have encountered former employees with a grudge seeking to stand for election to the board).
  • Not being involved in a business which actively competes with the co-operative.
  • Not being physically or mentally incapable of acting – which should be certified by an independent medical practitioner.
  • Not having previously served as a board member beyond a specified period – the Code now specifically provides for three terms of three years as a maximum.
  • Previous expulsion or removal under the rules.

Transparent rules

The criteria will vary from co-operative to co-operative, but should be fair, open and transparent, and not penalise any group inadvertently. All candidates should be made aware of the rules, and asked to sign to confirm that they do meet all conditions.

If it subsequently comes to light that they do not, then candidates can be removed at any stage of the process. This is generally a decision for the Secretary of the co-operative (ideally this should also be specified in the constitution).

Securing the appropriate skills

Some co-operatives may have a need for particular skills or knowledge on the board. There is an acknowledged tension between the fundamental commitment to democratic ownership, which runs through all co-operatives, and the need to secure appropriate skills at board level. The larger the co-operative, and the more complex its business, the more acute this need can be.

The Code expects a co-operative board to “regularly review its composition, succession plans and size to ensure it reflects the nature, diversity and scale of the co-operative, the complexity of the risks faced by it and the need to ensure appropriate member representation”.

If there is to be a 'skills filter' or a shortlisting process, before candidates are allowed to go forward to a ballot, then this should be clear and transparent from the start. Ideally, there should be a scoring mechanism used which can also be shared with candidates and with members.

Co-opted positions

Some boards will have the option of a limited number of co-opted places, in addition to elected board members (though these should be in the minority). This will depend on the constitution.

Co-options can be a useful mechanism for dealing with skills 'gaps' on a co-operative board, though the appointment process should be clear and transparent, and open to member scrutiny.