A board of directors is the representative body of the members of the cooperative. It represents the legitimate cooperative owners and acts on their behalf. The owners elect the board and place in its hands the administration of the assets and responsibilities of the cooperative. The board of directors has five principal functions:
1. Legal: Ensure the legal right of the cooperative to exist.
2. Trusteeship: Act in the best interest of the members.
3. Planning: Develop programs and carry out plans based on ideals that reflect the thinking of its members with realistic goals adjusted to the purposes of the cooperative.
4. Resources: Assure the availability of basic resources, including personnel, loan funds, wholesale power and revenue, according to the cooperative's size and needs.
5. Control: Monitor operations to assure compliance with board policy, budgets, member relations, loan covenants, contractual compliance and long-range planning.
In addition to the above responsibilities, directors also have certain duties and rights. director duties include loyalty, obedience and due care. Loyalty requires a director to be loyal first to the cooperative entity. Obedience requires a director to perform his or her duties in accordance with applicable laws, bylaws, contracts and policies. Due care requires a director to perform his or her duties as a member of the board, or any committee of the board upon which he or she serves, in good faith, in a manner he or she reasonably believes to be in the best interests of the cooperative, and with the care that an ordinarily prudent person in a similar position would use under similar circumstances.
