BOARD OF TRUSTEES

 

Eligibility Requirements

It is vitally important to PCC that Trustees are aligned with PCC’s values, prepared to commit the time necessary to serve as a PCC Trustee and are free from conflicts that could affect their decision-making in the best interest of PCC.

Section 3.3 of the Bylaws provides that in order to be eligible to serve as a Trustee, a person must satisfy certain criteria stated in the Bylaws, as well as independence, non-competition and other reasonable eligibility requirements adopted by the Board.

To ensure that Board decision-making is not influenced by considerations other than what is in the best interests of PCC and its members, and to reduce the possibility of the appearance of impropriety in Board deliberations, the Governance and Membership Committee (GMC) of the Board recommended and the Board adopted, at the November 4, 2020 Board meeting, the attached Board of Trustees Eligibility Requirements (the “Eligibility Requirements”), to be effective immediately. These Eligibility Requirements replace and supersede the Independence, Noncompetition and Eligibility Criteria previously adopted.

The Eligibility Requirements (1) outline the general expectations of time and preparation each trustee must devote to service on the PCC Board of Trustees, (2) identify those affiliations and other circumstances that make an individual ineligible to serve as a Trustee or not independent, (3) require that trustees and candidates for Trustee disclose to the GMC certain changes in circumstances identified in the Eligibility Requirements that could impact a Trustee’s eligibility, independence or ability to serve, and (4) where requested by the Chair of the Board, require that Trustees tender their resignation if the changes in circumstances warrant such, in the determination of the GMC or Board Chair.

PUGET CONSUMERS CO-OP (PCC)
BOARD OF TRUSTEES ELIGIBILITY REQUIREMENTS

The PCC Bylaws specify that to be eligible to serve as a trustee on the PCC Board of Trustees (“Board”), a person must satisfy certain enumerated criteria, as well as meet independence, non-competition and other reasonable eligibility requirements adopted by the Board (“Eligibility Requirements”). Eligibility Requirements help protect PCC’s reputation for trustworthiness by setting high standards of integrity for and independence of the Board of Trustees as PCC’s governing body.
The Independence, Noncompetition and Other Eligibility Standards adopted by the Board on February 7, 2019 are superseded in their entirety by these Eligibility Requirements.

When applying the Eligibility Requirements, the Board will consider an individual’s:

  • alignment with PCC’s values,
  • affiliations with certain organizations and their potential impact on the reputation of PCC with its stakeholders, and
  • real or perceived conflicts of interest and how those conflicts could affect the interests of PCC.

The Board sets expectations for trustee-candidates. Included among those expectations is that the candidate will devote the time and attention required to perform the duties of a trustee at an acceptable level. All trustees undergo periodic evaluations by their peers and those evaluations help determine whether a trustee is performing at an acceptable level.

Candidates for the Board and incumbent trustees are expected to provide full, candid, and timely disclosure of any circumstances, including those outlined below, that may impact the individual’s reputation, eligibility for the Board, or ability to serve as a trustee. The disclosure is made to the Chair of the Governance and Membership Committee of the Board (the “GMC”).

Bylaws Eligibility Criteria

Section 3.3 of PCC’s Bylaws specifies that to serve as a trustee an individual must:

(a)    be an Active Member (as defined in the Bylaws) of PCC,

(b)    be at least 21 years old,

(c)    not be prohibited to serve by term limits imposed by the Bylaws, and

(d)   meet the Eligibility Requirements.

Section 3.3 of the Bylaws also prohibits more than two PCC staff members or “Related Persons” from serving on the Board at any one time.  The Bylaws define a “Related Person” as:

  • a spouse, child, grandchild, sibling or parent
  • any individual sharing a household (such as a partner or friend); but a tenant or employee is not considered a “Related Person.”

General Ineligibility of Individuals Affiliated with Competitors

Individuals affiliated with competitors of PCC are likely to have interests that conflict with the proper performance of the fiduciary obligations of a PCC trustee and such individuals would, therefore, typically be ineligible to serve on the PCC Board. The GMC will evaluate those facts it deems relevant in determining whether an individual affiliated with a competitor is able to perform the fiduciary duties of a PCC trustee and whether the individual’s service as a trustee would provide demonstrable benefits to the co-op.

Other Ineligibility Criteria

The following individuals and their Related Persons are ineligible to serve as PCC trustees:

1. elected officials, political candidates, or leaders of a politically-affiliated organization with political influence over PCC;
2. current partners of any firm providing financial auditing services to PCC, whether or not involved in the PCC audit engagement;
3. a current employee of PCC where service on the Board would cause the number of PCC employees to exceed the limits set forth in Section 3.3 of the Bylaws;
4. individuals who, as a result of employment duties or personal circumstances, are not able to devote sufficient time to fulfill their Board duties, which includes consistent attendance at both regularly scheduled and special Board and committee meetings and preparing in advance for such meetings;
5. individuals convicted of a crime of moral turpitude;
6. individuals whose reputation has been impaired to the extent that their service on PCC’s Board could or would reflect negatively on PCC, as determined in the sole discretion of the GMC.

Independence of Trustees

When trustees have true financial and personal independence and also bring an independent mindset to their duties, the Board can have a clear focus on decision-making that advances the best interests of the co-op. With this objective in mind, the Board has set a standard that at least two-thirds of trustees will be independent.

The following individuals are deemed not independent:

A. Current PCC staff members (and Related Persons);

B. Officers and former officers (and Related Persons) of PCC within the five (5) years prior to his/her/their proposed election or appointment to the Board;

C. Individuals (and Related Persons) who worked on any PCC audit engagement within the three years prior to his/her/their proposed election or appointment to the Board;

D. Employees, officers, or directors (and Related Persons) of, or holders of a significant ownership or other financial interest in, a company/organization that is a current supplier of goods or services to PCC; and

E. Employees, officers, or directors (and Related Persons) of a non-profit organization, public trust, or community organization that is receiving, or has received within the prior three (3) years, a grant or donation of $25,000 or more from PCC.


1 An incumbent trustee who serves as an officer on an interim basis at the request of the Board will not lose his/her/their independence solely because of such interim service.
2 An example of a non-ownership financial interest is deferred compensation in a qualified or a non-qualified retirement plan.

Obligation To Disclose and To Tender Resignation If Requested

An incumbent trustee or candidate for trusteeship will promptly inform the chair of the GMC of any changes that could be relevant to such individual’s independence or eligibility to serve, including:

  • changes in personal circumstances that could negatively impact the ability to fulfill the duties as a trustee,
  • changes in employment,
  • changes in equity holdings or financial interests in any supplier/vendor of goods or services to PCC, or
  • an invitation/recruitment to serve on the board of any company or organization not previously disclosed to PCC. An incumbent trustee may not accept appointment or election to the governing body of any entity without the consent of the GMC.

 

At any time following the occurrence of any of the following, an incumbent trustee must tender his/her/their resignation at the request of the Chair of the Board if such trustee:

  • becomes ineligible to serve under the Eligibility Requirements,
  • was elected or appointed as an independent trustee and later becomes not independent under the Eligibility Requirements, or
  • by virtue of a change in employment or personal circumstances, in the determination of the GMC, either is no longer able to fulfill his/her duties as a trustee or no longer meets those criteria that the Board deemed important at the time of the trustee’s nomination.