Modernized governance strengthens Alberta’s credit unions
The Government of Alberta has introduced Bill 32, the Credit Union Amendment Act, to expand services credit unions can offer to Albertans and businesses and to enhance governance of the credit union industry.
The proposed legislation would allow Alberta’s 22 active credit unions to broker insurance through a subsidiary in a separate and distinct location. It would also clarify that businesses can become members of credit unions, creating more opportunity for small- and medium-sized businesses to access lending. The bill would also allow members to take advantage of federal tax planning programs for interest earned on credit union revenue.
New disclosure requirements would ensure that shareholders have access to compensation details for top executives, and provisions in the legislation strengthen governance of credit unions and their trade association, Credit Union Central of Alberta (CUCA).
“Credit unions are a vital part of Alberta’s financial industry and our communities. These changes would increase choice for consumers, support economic growth and introduce modern governance so credit unions can continue to be successful into the future, with strong accountability to members and the public.”
Modern governance and disclosure
Provisions in Bill 32 would require compensation disclosure for the five highest-paid executive officers in credit unions that represent more than 2.5 per cent of total credit union industry assets. Quorum requirements for general meetings would be updated based on the size of individual credit unions, recognizing that many credit unions have grown significantly.
The legislation would require that CUCA’s board include at least two unaffiliated directors, and it would implement a dispute resolution process in the event that one credit union obtained majority representation on the board.