CHAPTER 5

Administration

OBJECTIVES
To identify and distinguish the structural elements of a
cooperative.
To recognize and contrast the different powers, rights, duties,
and responsibilities of a member, the general assembly, board
of directors, officers, and committee members.
To identify and show the different grounds for removal of a
member, director, officer, and committee member.
To design the administrative structure of the different
cooperatives.
To assess and recommend course of action to take regarding
the different facets of a cooperatives administrative structure.

GENERAL ASSEMBLY
- COMPOSITION OF THE GENERAL
ASSEMBLY

Composed of members with voting rights.

Exercises general supervision and control.
The sovereign body in the co-op.
Hears and approves reports and plans of the Board and the
committees.
Amends by-laws.
Elects and removes officials.
Approves, disapproves or modifies all proposed financial and
operational policy changes, annual business plans and budget
as recommended by the board of directors.

POWERS OF THE GENERAL

ASSEMBLY

Highest policy making body.

The general assembly can overrule the board.
Exclusive powers that cannot be delegated.

MEETING OF THE GENERAL

ASSEMBLY
Regular meeting -

the general assembly holds its regular

meeting annually on a fixed date stated in the by-laws.

Special meeting if it is necessary that a special meeting of

the general assembly be convened, at least one week written
notice shall be sent to all members.

Special meeting to regularize operations in the

case of the newly approved cooperative, a special general
assembly shall be called within 90 days from such approval.

CDAinitiated special meetings

the CDA may call,

motu propio, a special meeting of the cooperative to report to
the members the result of any audit, examination, or other
investigation of the cooperative affairs ordered or made by the
Autority.

Waiver of Notice notice of any meeting, weather regular

or special, may be waived, expressly or impliedly, by any
manner.

QUORUM
- The general norm regarding quorums is provided in the bylaws.

VOTING SYSTEM
Primary Cooperatives members shall have only one
vote and no voting agreement or other device to evade the
one-member-one-vote provision shall be valid.

Secondary or tertiary cooperatives the rules on

voting vary slightly. It shall have voting rights as delegate of
member-cooperatives, but such secondary or tertiary
cooperative, as delegate, shall have only five votes even if the
co-op has more than 5 members-cooperatives.

BOARD OF DIRECTORS
- COMPOSITION OF THE BOARD OF
DIRECTORS
Consist of 5-15 members elected by the general assembly.
From among themselves, elects the chair and vice chair,
appoints the Treasurer and Secretary.
Sets direction.
Formulates policies.
Supervises the manager and the management staff, education
committee and other committees that it may create as needed.
Submits annual report and proposed action plan and budget to
the general assembly.

Powers of the board of Directors

The board of directors directs and supervises

the business of the cooperative. It also manages
the property of the cooperative. By or through
a resolution, it exercises all cooperative powers
that are not reserved for the general assembly
under the Code or the by-laws.
.

The powers of the board, exclusive of those reserved for the

general assembly are as follows:

1) To elect from among themselves the chairman and vice-chairman and appoint the
board secretary and treasury. [Art.43(3)]

2) To call for a special general assembly meeting within 90 days from the approval of
the registration of a new cooperative [Art.35]

3) To approve membership applications [Art.29]

4) To call for a special meeting of the general assembly [Art.35 (2)]

5) To discuss operating problems [Art.38&39]

6) To make decisions about expenditure [Art 38&39]

7) To determine the compensation of employees in the cooperative, unless already fixed

in the
by-laws [Art.47(3)]

8) To recommend the interest on capital to be paid, subject to confirmation by the

general
assembly [Rule 4, Section 2, Implementing Rules and Regolutions]

9) To recommend the rate of patronage refund, upon authority from the general assembly
[Rule
4, Section 2, Implementing Rules and Regulations]

10) To designate the depository bank/s of the cooperative [Art.38&39]

11) To approve the assignment of share capital contribution or interest [Art.75 (3)].

12) To raise a revolving capital, evidenced by certificates of revolving capital, subject to

confirmation by the general assembly by deferring payments of interest on capital and
patronage refund [Art.80]

13) To determine the adequacy of bonds for the accountable officer or employee/s to be
bounded [Art.57]

14) To terminate membership for cause [Art.31 (3)]

15) To recommend development plans to the general assembly [Art.34 (3)]

17) To accept and receive grants, donations and assistance from foreign and domestic sources.
[Art.9(8)]

18) To decide on suits to be filed [Art.9 (1)]

19) To see it that the co-op has a wide ranging integrated communication effort, so it can grow
rapidly to effectively and efficiently service the entire membership [Art.7]

20) To cooperate with the other elected officials at the cooperative, such as the credit,
education, and auditing (examining) commitees (While the board rightfully does not enroach
on their jobs, it decides the over-all policies which they implement and provides adequate
logistical support so they can fulfill their functions) [Art.38-39, 43-51]

21) To call for special meetings of the board through the chairman (or president, if the by-laws
call the head of the board as such) [Art.41(2)]

22)To admit as non-voting director a representative from a financial institution extending

financial assistance to the cooperative [Art.40 (2)]

23) To fill a board vacancy created not due to expiration of term, if the board still constitutes a
quorum [Art.42]

24) To apppoint members of the executive committee and delegates powers to it [Art.44 (1)]

25) To call for an election of, or to appoint members to committee vacancies [Art.44 (2)]

 26) To recommend the voluntary dissolution of the co-op to the

general assembly where no creditors are effected [Art.65]
27) To file the petition for voluntary dissolution with the CDA
where creditors are effected [Art.66]
28) To hire an external auditor [Art.81]
29) To approve investments [Art.79]
30) To arrange for property insurance [Art.39]

Who Can Be Directors?

Any Regular member of the cooperative who has the right to
vote under the by-laws, and possesses all the qualifications
and none of the disqualifications provided in the laws or the
by-laws, may be nominated and elected director.
There is another type of director in a cooperative and this
director is one who is not even a member of the cooperative.
He cannot vote in any matter under deliberation by the
board. This director may be an employee o r a responsible
officer of a financial institution that has extended financial
assistance to the cooperative.

Vacancy in the Board of Directors

When a vacancy in the board is caused by the
expiration of the term of office, the due
recourse is to hold elections. However, if the
vacancy is due to any reason other than the
expiration of term of office, and the remaining
members still constitute a quorum, then the
board can fill up the vacancy by the vote of at
least a majority of the remaining directors.

Officers of the Cooperative

The general assembly elects the
board of diractors but this election
deals only with the required number
of the board members. At the first
meeting of the board after their
election, they vote for the chairman
and the vice-chairman from among
themselves. The board secretary and
treasurer are appointed from
members outside of the elected