Board Roles & Responsibilities

A. Role

The board of directors’ role is to direct the management of the business and affairs of the credit union to ensure Conexus is managed and operated in a sound and prudent manner, as established in The Credit Union Act, 1998 (the ‘Act’) and the Standards of Sound Business Practice (the ‘SSBP’).

B. General Legal Obligations

The membership of Conexus elects the board to represent their ownership interests.  Directors have a fiduciary duty1 to carry out their duties:

  1. Honestly and in good faith
  2. In the best interests of Conexus
  3. With the care, diligence and skill of a reasonably prudent person

C. Relationship with Management

While Section 93 of the Act assigns responsibility to the Board to direct the management of the business and  the affairs of the credit union, the board delegates to the Chief Executive Officer (CEO) responsibility for day-to-day leadership and operation of Conexus and the governance and management systems of its subsidiaries.

The CEO authority is established through policy and ensures management regularly provides appropriate and timely information and reporting to the board to meet its fiduciary obligations.

The board promotes a collaborative relationship with management and respects the approved organizational structure. A director has no authority to direct any management or staff member.

D. Governance Responsibilities

The board retains responsibility for managing its own affairs to:

  • Set the governance practices, policies and processes for the board to meet legislative and regulatory obligations and evolve to uphold governance best practices.
  • Determine the desired composition of the board for the purpose of recommending candidates for election or directors for appointment.
  • Regularly assess the performance of the Board and its directors, to identify competencies needed on the Board which will be used to inform director election calls for nominations from the membership.
  • Ensure an effective system to provide the necessary independent assurances to the board for it to be confident and demonstrate that it is in control of the credit union.
  • Determine the composition of, and set the mandate for board committees.
  • Set meeting schedules and agendas, keep minutes of proceedings, and meet in-camera.
  • Review and set director remuneration.
  • Determine director orientation and continued director development programs.
  • Select, appoint and retain the CEO.
  • Appoint the corporate secretary for the board.
  • Uphold a succession plan for continuity on the board.
  • Communicate with the regulator, government, membership or media2 on behalf of the board with the Board Chair designated as the primary spokesperson for the Conexus Board of Directors.

E. Additional Responsibilities

1. CEO Role and Compensation

The board is responsible for oversight of the CEO and the following responsibilities:

  • Completing, recruiting, monitoring and setting performance objectives for the CEO, including approval of a position description.
  • Annual performance evaluation process and approval of the CEO’s total compensation.
  • As required, approval of the retirement or severance arrangements for the CEO, to take effect in the event of a termination of employment or any changes in the agreement.
  • Approval of the appointment of an interim CE, if required.
  • Providing advice and counsel to assist the CEO in achieving performance objectives.
2. Organizational Structure and Human Resource Management

  • Oversee the overall compensation strategy recommendations ensuring consideration has been given to the following:
    • Alignment with the mandate and strategic priorities of Conexus.
    • Reflects an appropriate mix of fixed and variable compensation to be competitive for successful attraction and retention.
    • Conexus’ ability to pay.
  • Oversee that the organizational structure reflects adequate balance and separation between revenue generating activities and risk management control functions and that each area have appropriate resources, focus and status.
  • Ensure risks have been assessed and mitigated (if applicable)
  • Ensure that a succession plan exists for the CEO and executive management.
3.  Strategic Planning

  • Annually review with management the corporate strategy and balanced scorecard including purpose, values and strategic objectives.
  • Safeguard Conexus’ resources by reviewing and approving the operating plan and budget including capital expenditures.
  • Ensure effective coordination of strategic management with capital management and risk management processes.
  • Actively monitor progress towards achieving strategic objectives as measured in the balanced scorecard and operating performance compared to budget; revise and alter the strategic direction to management in light of changing circumstances.
4. Board Policies

  • Set board policies for all aspects of operations to provide guidance to management, including defined risk tolerances, accountability and reporting requirements. Actively monitor, through management, compliance with board policies that govern operations.
5. Business Conduct and Regulatory Compliance

  • Direct management to implement operational systems designed to ensure that Conexus operates at all times in accordance with applicable legislation, standards of sound business practice, board policy, and to the highest ethical standards.
  • Approve and act as the guardian of Conexus’ corporate ethical standards by maintaining codes for conduct and market practices that ensures good business practices and fairness to consumers.
  • Actively monitor, through management, compliance with applicable legislation, standards of sound business practice and board policy that govern Conexus’ operations.
6. Risk Management

  • Direct management to implement operational systems designed to ensure that Conexus has appropriate controls and can demonstrate that business risks are identified and managed.
  • Review and approve an enterprise risk management frameworkthat supports the proactive identification, assessment and management of significant risks.
  • Annually review and approve Conexus’ risk appetite statement and risk profile.
  • Actively monitor, through management, the effectiveness of the risk management approach to control business and operating risks.  
7. Assurance Reporting

  • Specify the content and frequency of reporting needed from management in order to monitor performance and gain reasonable assurance of organizational control and prudent business conduct.  
  • Annually report to the membership on the board’s stewardship for the preceding fiscal year.
  • Set appropriate disclosure requirements to support transparency to members and other stakeholders regarding operations, risks and capital adequacy as outlined in the SSBP. (Refer to Disclosure policy)
8. Accountability

In performing its functions, the board considers the legitimate interests of stakeholders including Credit Union Deposit Guarantee Corporation, employees, the community served and is accountable to the credit union and its membership.

1Without being legally precise, a fiduciary duty is duty to act for the benefit of another (i.e. the membership)

2 The Board Chair and CEO are the two primary spokespersons for Conexus credit union (refer to Disclosure policy)