Famous words uttered by Abraham Lincoln could provide a salutary caution to the agency’s embattled board of directors.
It was 1858, the United States was sharply divided over slavery and headed for a civil war. Lincoln, running for the Senate, was speaking to a state Republican convention.
“A house divided against itself cannot stand,” he warned, paraphrasing a verse from the Bible.
There’s no civil war in the offing, but the CWB’s new-look board of directors is clearly a house divided against itself.
Following a series of firings and appointments by wheat board minister Chuck Strahl, along with the recent director elections, the 15-member board of directors is divided almost equally on whether the board should retain its single desk marketing authority.
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It’s not exactly clear how interim chief executive officer Greg Arason will fit into the equation, having said publicly that he intends to stay out of the single desk debate.
However, despite his history as a single desk supporter, the fact he was appointed by Strahl suggests a strong possibility that he would be more likely to vote in line with the government’s wishes on any crucial single-desk related issues.
If that turns out to be the case, that would leave single deskers with a razor-thin 8-7 majority.
All eight single desk supporters have been elected by farmers, meaning that if they all maintain that stance, single deskers will retain that majority for the next two years.
Those supporting the government’s plans include two elected farmers and four government appointees. If Arason is included, that makes seven.
There are routine operational matters and policy issues to which the single desk vs. open market split is irrelevant. For example, directors recently unanimously agreed to ask the federal government to allow the board to take over responsibility for adjustment, interim and final payments.
But any issue involving the future of the single desk will almost certainly produce a sharply split vote.
Present and former board members from both sides of the issue and outside observers say it will be difficult for such a divided board to properly function.
“That kind of situation makes for a dysfunctional board,” said Jim Brown, an expert in board governance with the international consulting firm Strive.
Recently appointed director Ken Motiuk called the situation a “distraction” to normal board operating routines.
“It’s just common sense to suggest that when you’re having such discord on any board, it affects your discussion of the issues you have to deal with.”
Elected director Rod Flaman, a single desk supporter, said he’s already noticed a negative change in the atmosphere around the board table since the recent government appointments.
“There will be more disagreement and debate on everything and that will slow things down,” he said, using words like antagonistic, vociferous and belligerent to describe the mood.
Much of the responsibility for ensuring the smooth functioning of the board falls to chair Ken Ritter. He said he’s aware of the challenges ahead.
Board chairs often don’t vote on divisive issues, Ritter said, but he expects to cast a lot of deciding votes.
“My goal as chairman will be to try my level best to find an approach that allows differing views to come together to a considerable degree and to develop compromise and consensus” he said. “I’ll try my best to make it work.”
Flaman is skeptical whether that will be possible, saying directors who support the government’s plans have chastised single desk supporters during recent board meetings, arguing that Strahl is their boss and they should follow the government’s directives.
Motiuk declined to comment on specific discussions during board meetings and criticized those who do.
“It’s not really appropriate for a director to comment on the inner workings of a board,” he said. “This is a $4 billion commercial operation, not a political football and not a forum for political grandstanding.”
He acknowledged that the board’s distinctive shared governance system, with elected and government-appointed directors, is showing weaknesses.
In his view, shared governance means the government is an equal partner with the board of directors and it’s not in the best interests of the corporation for the two governing partners to be at war with each other.
Flaman insists that the intent of the CWB Act of 1998 was to give control of the organization to elected farmers. He said the government appointed directors are there to provide financial oversight and expertise in specific areas.
In the past, appointed directors generally stayed out of debates over farm policy, public affairs, farmer relations and the single desk, he said.
“They would follow the farmer-directors’ lead,” said Flaman, adding his approach will be to ignore the input of the appointed directors on those kinds of issues.
Ritter said the CWB Act states that all directors have an equal role in board deliberations and voting.
Brown said directors must remind themselves before casting a vote that their decisions affect everyone who does business with the organization.
“Their legal obligation is to make decisions as a body that best meet the needs and protects the interests of the members or shareholders as a whole, not as individuals,” he said.
They must also be committed to abide by and support the decision of the majority.
