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Co-op board of directors conflict of interest
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Thud
Posted 3/16/2019 17:48 (#7384263 - in reply to #7384230)
Subject: RE: Co-op board of directors conflict of interest


Near-north Ontario, French River
FWIW, the Board at the time should take some responsibility for the 'hedge to arrive' fiasco, as they should have implemented a risk tolerance policy. I served on the local Board for 13 years. Prior to taking my seat the co-ops grain business had almost collapsed, again due to management taking , what at the time seemed like a very reasonably / position in the grain markets. Problem is, within in days of taking that position the markets collapsed and things went south in big hurry. Thankfully the co-op survived and the Board of the day saw the wisdom of having very clear( and some might argue restrictive) risk policies. This all happened years before I got on the Board but it was one of the first things that drilled into me when I attended my first meetings. Its the BOARD'S responsibility to protect the members money, and the Board can do that by instituting and enforcing proper policies Things like only being able to have "x" amounts of bushels unhedged at anyone time, or maintaining minimum margin levels, or inventory etc etc. Couple that with getting good, accurate and timely financial information ( at having Board members ask a LOT of questions to be sure everyone understands things, not just rubber stamp) and an engage Board should be able to maintain control of the Co-op. Too many times management gets blamed for a co-ops failure, when the reality is that many times the Board was sleeping at the wheel or failed to exercise proper oversight of the business plan and managements actions.
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