How CUs are Addressing Diversity at the Board Level

Source: American Banker

Credit unions are supposed to be representative of the communities they serve, but their board members don't always reflect their audience's diversity. Many in the industry are working to change that. 

Building on the discussions that followed the murder of George Floyd in 2020, many financial institutions have adapted their hiring practices to better address diversity, equity and inclusion — both internal and external — and tailoring their operations based on the new perspectives they bring in.

Within the credit union industry, a longstanding issue of succession planning creates an opportunity to seek out fresh voices and talent, Susan Mitchell, chief executive of the consultancy firm Mitchell, Stankovic & Associates in Boulder City, Nevada, said during a panel discussion at CUNA Mutual's Discovery 2022 conference.

"Diversity is all about diversity of thought, and what we're looking at right now is a significant transition of leadership within our credit union space … For me, one of the critical areas we all have to think about is starting to develop succession plans for boards and start to develop the next level of [talent], because we need to have people that we pass the legacy to," Mitchell said. 

At many credit unions, the boards are still reflective of the original fields of membership, despite any expansions to the institution's scope of membership or changes to the region's demographics, Mitchell said.

"You have to bring people in and then respect what's taking place, and I really believe that it breaks from the culture of what the board has created at times … Field of memberships are changing, and how many of our boards today still reflect that original group," Mitchell said. "Being intentional about that expansion is something that is a lot of hard work."

Credit union boards seeking such change have begun reviewing the makeup of directors against current fields of membership and are working to bring on people who better understand the needs of members within the local communities.