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Coast Capital Savings members force cut to directors’ pay

Pay rates have been slashed for Coast Capital Savings directors after members of the credit union voted overwhelmingly for a review of the board’s compensation.
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Coast Capital's branch in downtown Victoria.

Pay rates have been slashed for Coast Capital Savings directors after members of the credit union voted overwhelmingly for a review of the board’s compensation.

But unhappy credit union members say far more needs to be done and they want to have a say in how it is run. They will be mapping out a strategy to win greater input and consultation, member Phil Embley said Friday.

“If we don’t have member participation, then what we really have is another bank,” he said.

The group’s goals include imposing a limit on the number of terms served by board members, bringing in changes to the board election system and requiring more feedback from the board. “We want to know what is happening with our credit union. We own it, not the board. The board works for us,” Embley said.

The credit union announced Thursday it is selling its insurance arm, but Embley said he had not been aware that such a sale was being considered.

Sheira Hallam, head of communications at Coast Capital, said the organization believes in the importance of ongoing dialogue with members.

“We welcome their feedback through whatever channel they choose, including participation in our member ThinkTank feedback tool [on Coast Capital’s website.]”

Embley launched a campaign because he believed that directors’ compensation was too high compared to other credit unions.

Coast Capital board members received a total of $720,529 in 2012 — more than double what rival Vancity, Canada’s largest credit union, paid its board over the same period.

Coast Capital has the highest number of members among Canadian credit unions, at 504,000. It has 50 branches and $14.6 billion of assets under administration. Vancity has 492,000 members, 75 branches and $17.1 billion in assets.

Members of Coast Capital voted 79.7 per cent in favour of a special resolution to have members establish the remuneration for directors and that the amounts be published in the annual report. A total of 23,098 ballots were cast between March 22 and April 16.

The annual general meeting on April 30 heard that a new advisory member panel is being created to work with the board to decide if changes are needed in director compensation. Any recommendations will go to members for a vote next year.

But Embley said the advisory panel was announced at the AGM without consulting with members first.

The credit union said the panel’s job will include how to apply its principles of remuneration policy.

After a 2007 vote, a system was established to determine Coast Capital board pay levels. The goal was to be between the highest 25 per cent of Canada’s co-operative organizations and the lowest 25 per cent for comparable public companies.

Effective April 25, Coast Capital rolled back board compensation and postponed planned raises to save an estimated $130,000 annually. Board compensation will be set at the mid-point between the two categories of companies reviewed by the consultant.

The basic retainer for board chairman Bill Wellburn was cut to $65,000 from $76,500. A planned increase to $29,500, from $25,500, for other directors was put on hold.

Committee chair retainers have dropped to $5,000 from $10,610. Director meeting fees were decreased to $1,000 from $1,020.

The board has done away with its request that the chairman attend all board committee meetings. Wellburn received $157,080 in total last year.

Also eliminated is an annual cost of living allowance for director compensation.