When starting a co-op there are usually a few people who drive it forward – a core group or individual dedicated to getting the co-op up and running. But when these early leaders step away or retire, it can create a void in leadership.   

That’s why it’s essential for co-ops to build succession plans and processes that can help transition operations and governance when key people leave.  

We were lucky to meet with two leaders with key insights into this important process. On a recent trip to Montreal, Trista and I took a short drive to Kahnawake to visit the caisse populaire, an Indigenous-owned and controlled financial institution. Founded in 1987, the Caisse Populaire Kahnawake is one of Canada’s most successful small credit unions, thanks in no small part to founding member and first general manager Michael Rice and current general manager Mandy Montour.   

Michael helped establish the caisse populaire, and when he stepped away as the general manager in 1995, he hand-picked Mandy to take over leadership. After a 35-year career, Mandy is also eyeing retirement, raising some important questions about succession planning.   

So how do co-ops remain stable during leadership changes? Luckily for us, Michael and Mandy have some suggestions.   

Find a Champion  

Every co-op has its champion – the one or two leaders who shoulder a lot of the work and help create their co-op. Once they step away, their replacement may not have the same energy and passion, which can cause the co-op to lose momentum.   

Get the outgoing leader involved in the search for the right replacement. They understand what qualities are important when filling the position. The new leader should be someone who values the co-operative’s structure and member ownership, who advocates for members and their community, and who understands the co-op’s purpose and works towards helping achieve its mission.   

Determine a Transition Period – and Don’t Rush  

A change of leadership can take time. Whether it’s onboarding a new manager or replacing the board president, succession shouldn’t be rushed. Depending on how complex your co-op’s governance and operations are, this may be a multi-year process to ensure candidates receive the training and certifications they need to take over.  

For a board president, consider dedicating the final year of a term to training prospective replacements to ensure a seamless transition. And, to ensure continuity on the board, there are a few practices co-ops can implement. First, ensure your director’s terms are staggered to ensure that only one-third or half of the board faces election each year. Second, consider permitting members to join the board on a prospective basis. River Bend Co-op in central Saskatchewan allows two members to join the board for a year or two to gain some experience before seeking election.   

For a management team or CEO, both Michael and Mandy recognized the value of promoting from within. This ensures candidates have expertise with the co-op’s operations and are familiar with the team and key protocols. But transitions can still take time, so consider building a succession plan with tangible milestones that the outgoing manager can guide their replacement through.    

Ensure They’re Local  

Mandy stressed how important it was to ensure the General Manager of Caisse Populaire Kahnawake was a member of the community. Only a local can bring a deep understanding of the community to the co-op’s operations. This helps facilitate trust between the caisse populaire and the people it serves and guarantees an appreciation for the community’s unique needs. Both Michael and Mandy credit this trust to the caisse populaire’s success; it took a lot for community members to trust each other with their financial information. Hiring from among your current team members is an easy way to facilitate local leadership.   

Learn More 

Interested in learning more about succession planning and other good governance practices? Check out our online Co-op Professionals course. This FREE course provides an overview of the membership, operations, and governance of a co-op, demonstrating how various stakeholders work together to make their co-op a success.