Approach to Credit Union Governance
The governance of Earl Grey Credit Union Limited is anchored in the co-operative principle of democratic
member control. The members elect the board of directors, who in turn provide oversight of the General Manager
and the operation of the Earl Grey Credit Union Limited. In accordance with the bylaws, the Nominations
Committee is responsible for the nomination process and election of directors by members. Voting for the
directors is conducted by secret ballot by in-branch voting and election results are announced at Earl Grey Credit
Union Limited’s annual general meeting. To be elected, the person must be a member of Earl Grey Credit Union
Limited. Terms are three years in duration. Collectively, the board is capable to fulfill its role and represents a
variety of experience, competence and knowledge.
Board of Directors
Mandate and Responsibilities
The board is responsible for the strategic oversight, business direction and supervision of management of Earl
Grey Credit Union Limited In acting in the best interests of the credit union and its members, the board’s actions
adhere to the standards set out in The Credit Union Act 1998, the Standards of Sound Business Practice and other
applicable legislation. The board is composed of nine elected individuals.
In performing its role, the board approves all significant decisions that affect the credit union and its subsidiaries,
and regularly meets in camera without the general manager present. The responsibilities of the board are fully
described in its mandate and include:
 Manage its own affairs, such as setting the governance principles, establishing meeting processes
and determining the mandate and composition of board committees
 On an ongoing basis reviews the existing policies of Earl Grey Credit Union Limited to ensure
any additions and/or deletions are completed
 Select the general manager, establish performance objectives and evaluate performance and
determine compensation
 Participate in the development of the annual Strategic Plan; approve the Strategic Plan and
annual budget
 Monitor business risks and management’s progress toward achievement of strategic objectives
 Review and approve the financial statements and regulatory filings, and oversee timely and
accurate reporting to members and the regulator on the credit union’s performance
 Be accountable to the credit union and its members
The meetings of the board of directors are governed by a set of policies, one of which is attendance of the
directors to all meetings. Directors are expected to attend all board meetings, and meetings of the committees to
which they have been appointed. The board, by policy, must meet at least nine times each year and no less
frequently than once every three months. A board member shall attend at least 75% of the board meetings
annually. A director shall not miss more than two consecutive meetings unless the board determines that special
circumstances preventing meeting this threshold. Failure to meet attendance expectations in policy may disqualify
a director from continuing in office. In 2014, all directors complied with this policy. The board met twelve times
in 2014.
Board Committees
The board is divided into a number committees, this partitioning of responsibilities enables a clear focus
on specific areas of activity vital to the effective operation of our credit union. Committee memberships
are reviewed annually and take into consideration director skills and preferences. Each committee has a
mandate outlining its purpose and responsibilities. Outside advisors may be engaged at the expense of
Earl Grey Credit Union Limited. Committees meet regularly throughout the year and provide meeting
minutes and reports to the board.
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Audit Committee: is comprised of four directors and oversees the financial reporting process,
reviews financial statements, liaises with internal and external auditors and regulators, and
reviews internal control procedures. The Committee met three times in 2014.
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Enterprise Risk Management Committee: is comprised of all nine directors and
oversees the identification, understanding and management of risks that may affect Earl Grey
Credit Union Limited. The Committee met twelve times in 2014.
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Executive Committee: comprised of four directors - the board president, the vice-president,
Chairman of the Credit Committee and Delegate to SaskCentral. The executive committee acts in
the capacity of, and on behalf of the board of directors between regular or special board meetings
on all board matters except those which the board may not, in compliance with legislative
requirements, delegate to the committee. The Committee did not meet in 2014.
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Credit Committee: comprised of four directors and ensures credit granting practices comply
with provincial and federal regulation. To approve and monitor compliance with lending policy.
The Committee met five times in 2014.
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Conduct Review Committee: comprised of four directors and ensures Earl Grey Credit Union
Limited acts with the full integrity and objectivity of its directors, officer and employees by
having in place policies, processes and practices that protect people and the organization from
claims and from the perception of unfair benefit or conflict of interest.
The Committee met five times in 2014.
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Governance Committee: is comprised of three directors who are not candidates for re-election
to the board of directors and oversees the nomination and election processes for elections of
credit union directors. The Committee did not meet in 2014.
Board Compensation
Board members are volunteers, but are compensated for expenses and time. Director Compensation
includes:
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An annual retainer for serving as board president or board vice-president
A per diem for each board and committee meeting attended
A per diem for activities attended as a representative of the Earl Grey Credit Union Limited board
Travel costs, where applicable, to cover the time and mileage to attend meetings
Reasonable travel and other out-of-pocket expenses related to board service
Board remuneration for 2014 was:
Per Diems
Actual
$13,995.
Budget
$23,040.
Mileage/Travel
$ 4,613.
$ 6,000.
Total
$18,608.
$29,040.
Director Orientation and Continuing Education
We believe that director education is important to help directors understand our operations and issues
affecting our business, as well as maintain and build skills. The Governance Committee offers an
orientation program for new directors to familiarize them with business operations and expectations of
our board members. Directors are encouraged to participate in continuing education opportunities that
include attending relevant conferences and taking professional development courses at the credit union’s
expense. Several board members attended Credit Union Director Achievement (CUDA) training sessions
during the year. The CUDA program is under constant revision to be certain that board members remain
aware of their responsibilities and have the required tools and skills to help steer their organizations.
Evaluation Process
The board is committed to effective credit union governance and continuous improvement. Annually, the
board conducts an evaluation process to assess the effectiveness of board operations. Board members are
asked to complete a detailed questionnaire in key areas of board and committee performance. Results of
the evaluation formed the basis of recommendations to the board for improving governance practices and
opportunities for board development.
CREDIT COMMITTEE REPORT
As chairperson of the Credit Committee, it is my privilege to report to the members on the lending
activities of the Earl Grey Credit Union in 2014. There were a total of 157 new loans granted to
members representing $5,344,501. At year-end the Earl Grey Credit Union was lent out77.75% or
$23,541,182.
Annually, the Management lending limits are approved by the Board of Directors. A number of years
ago the Board increased the Management lending limits to the lending limit of our credit union to
ensure that we can handle all our members’ loan requests in a timely manner. In addition, this provides
the member with further comfort of privacy with the financial services provided by our credit union,
with only the professional staff accessing their loan files. Our lending limit per member for 2014 was
$501,882.
The credit committee, as per the Credit Union Act 1998, must continue to approve all Board of Directors
and management loan requests. As prescribed by legislation, the only member loan files that are
reviewed by the complete Board of Directors are those loans delinquent 90 days or greater.
The Credit Committee loan approval activity:
2013
Approved 6 for $51,135
Declined None
Extended None
Line of Credit Renewals 6 for $17,500
2014
7 for $243,682
None
None
3 for $41,500
The Manager and Loans Officer loan approval activity:
2013
Approved 196 for $5,938,288
Declined 3 for $448,600
Extended None
Line of Credit Renewals 243 for $1,520,700
2014
150 for $5,100,819
1 for $30,000
None
237 for $1945,450
Percentage of delinquent loans:
2013
2014
0.00%
0.16%
The prudent practices of our lending area and our membership integrity keeps loans portfolio strong.
On behalf of the Credit Committee, I would like to thank all the members who continue to utilize our
services for their borrowing needs as we realize consumers have many choices for their financial needs.
The Credit Committee will continue to strive to do our best in acting on behalf of the members, to
ensure that prudent lending practices are followed.
Respectively submitted
On behalf of the Credit Committee
Glen Ritter, Chairperson
GOVERNANCE COMMITTEE REPORT
The Governance Committee consists of the three directors who are not candidates for re-election in the
current year's election. The Governance Committee for 2015 election was Dawn Butz, Debbie Kothlow
and Alison Smith. The general manager acts as staff resource to the committee.
The purpose of the Governance Committee is to oversee the annual nomination and election of directors
for the Earl Grey Credit Union Limited. The Governance Committee’s role is to ensure there are
sufficient qualified nominees to fill each vacancy on the board. It is the practice of the Credit Union for
the Governance Committee to actively solicit qualified candidates to seek election to the board so that
the board has representation of a cross section of membership and skill sets. In addition, the committee
acts as a contact to those members who express interest in or inquire about elected office from the
membership at large.
The Earl Grey Credit Union Articles state that the number of Directors shall be maintained at between
five and nine, who are elected for a term of three years. Director terms are staggered so that each year
three director’s terms expire.
The following directors three year terms expire as of the 2014 Annual Meeting:
Doug Gilman, Glen Ritter and Gary Schaffer
During the nomination period papers were received from Doug Gilman, Glen Ritter and Mitchell Nixon
for the three 3 year positions. As no other nomination papers were received, the 2015 Board of Director
Positions has been filled by Acclamation.
Respectively submitted,
On behalf of the Governance Committee
Kristen Schmidt, Election Returning Officer
AUDIT COMMITTEE REPORT
The Audit Committee’s purpose is to ensure an independent review of the credit union’s operation in the
areas deemed necessary to maintain the integrity of financial data, adequacy of internal controls and
adherence to The Credit Union Act, 1998 and our policies.
The 2014 Audit Committee was comprised of Chairperson, Nadene Perry (Board Vice- President),
Ivy Kiel (Board President), Glen Ritter (Chairperson, Credit Committee) and Dawn Butz.
The committee reviews and approves the letter of engagement for the external auditor, annual audit fees,
audit plans and scope of the audit before the external auditor commences work for the current year. The
committee reviews the performance of the internal and external auditors and makes a recommendation
to the board of directors and the membership at the annual general membership meeting on the
appointment of the external auditor for the ensuing year.
Once the external and internal auditors have completed the annual audit, the committee reviews the audit
reports with the auditors. If either auditor has noted any significant observations and recommendations,
the committee monitors management to determine that necessary corrective actions have been made. At
least annually, the committee meets with the external and internal auditor.
Legislation has expanded the committee’s role to include:
- Review of information received from management on risk assessments (Enterprise Risk
Management) and any significant legislative non-compliance items.
- Review the annual auditor’s audited consolidated financial statements and supplementary
information before they are approved by the board and prior to publication.
- Recommend board approval of the financial statements
- Review of, and recommendation of board approval of the financial budget prepared by the
general manager
In addition to the annual external audit, the Credit Union Deposit Guarantee Corporation conducts audits
of each Saskatchewan credit union every few years to ensure compliance with the Credit Union Act,
1998 on behalf of the Registrar of Credit Unions.
Credit Union Deposit Guarantee, the external auditor and the internal auditor have all acknowledged that
Earl Grey Credit Union meets or exceeds the audit results for credit unions of similar size. In addition,
Earl Grey Credit Union meets or exceeds all financial targets mandated by the Credit Union Deposit
Guarantee Corporation.
Respectively submitted
On behalf of the Audit Committee
Nadene Perry, Chairperson
Operating principles of Earl Grey Credit Union include policies on code of conduct and a market code.
Code of Conduct is set and reviewed annually by the board of directors. It established the guidelines for board of
directors (and staff) in the following areas:
 All director and staff will abide by the laws of our province and Canada
 Maintain the integrity of our records
 Communicate in an open and honest manner
 Interact with all political parties in a neutral and equitable fashion
 Deal with businesses in a legal and ethical manner
 All staff will be treated with dignity, respect and fairness
 Conflict of interest guidelines are defined and conflict of interest must be avoided.
Credit Union Market Code Earl Grey Credit Union Limited voluntarily adheres to the Credit Union Market
Code. This code has been jointly developed by Saskatchewan credit unions, SaskCentral and Credit Union Deposit
Guarantee to ensure the protection of credit union members. The code sets forth guidelines for the following areas:
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Complaint handling, which outlines the process for dealing with all complaints regarding the service,
products, fees or charges of Earl Grey Credit Union.
Fair sales by outlining the roles and relationship of staff to all member/clients and in accordance with the
financial services agreement.
Financial planning process to advice member/clients on the risks and benefits associated with financial
planning services.
Privacy to protect the interests of those who do business with Earl Grey Credit Union. Privacy is the practice
to ensure all member/client information is kept confidential and used only for the purpose for which it was
gathered.
Professional standards to preserve a positive image of Earl Grey Credit Union among our members, clients
and communities.
Capital management to ensure our capital structure aligns with our risk philosophy.
Financial reporting to adhere to business and industry standards.
Governance practices to adhere to the intent and stipulation of our corporate bylaws, which are approved by
the membership of Earl Grey Credit Union Limited.
Risk management to ensure all risks are measured and managed in an acceptable fashion.