G5 Article dissertation
Paradoxes of Director Selection in Agricultural Co-operatives: Understanding Boards’ Conformance and Performance Roles
Authors: Huhtala, Kari
Publisher: LUT University Press
Publication year: 2024
Series title: Acta Universitatis Lappeenrantaensis
Number in series: 1135
ISBN: 978-952-412-078-4
eISBN: 978-952-412-079-1
Web address : https://urn.fi/URN:ISBN:978-952-412-079-1
The research focused on issues related to director selection in agricultural co-operatives. The aim was to gain comprehensive understanding of the paradoxes involved in director selection, and their relation to the conformance and performance roles of the board of directors (BOD). The research questions covered the director’s attributes and the related tensions, director selection and its paradoxes, and how these are linked with the board’s conformance and performance roles. The purpose of the study was to enhance understanding of the factors and relationships implicit in director selection in agricultural co-operatives. Methods of systematic literature review and qualitative case study were used, and the focus was on Finnish agricultural co-operatives. The findings indicate that representational director attributes were central in director selection, while competence attributes were growing in importance. No gender quotas were wanted. The results showed tensions related to the balance between the representation and competence aspects. The study highlights several paradoxes in director selection that are related to the co-operative governance culture and the power of the governance actors. These include candidate mapping, selection routes, collective selection, director renewal, the role of the directors, the role of the supervisory board, the representative council, regional interests and the role of the nomination committee. The results shed new light on the two roles of the BOD, the conformance and the performance roles, in the context of director selection including the use of the supervisory board (SB). The study suggests that agricultural cooperatives should consider increasing board diversity, the use of external directors and the broader use of nomination committees. The findings suggest that it is important to consider not only the director candidates’ attributes, but also the potential impact of the selection on overall board performance. The study suggests a need for further research on director selection in different countries and contexts with a focus on board nomination procedures, gender diversity and corporate social responsibility within the context of the BOD. The study recommends adopting a paradox theory perspective as a framework for future research in co-operatives.