What is the purpose of this pamphlet?

This pamphlet is designed to help you, as 

a member of the nominating committee, in 

your yearlong task of identifying and evaluating candidates for election to your bank 

or association’s board of directors. This is 

a very important service to your cooperative and will affect the effectiveness of your 

board in fulfilling its duties on behalf of the 

stockholders.

What is a nominating committee?

A nominating committee is a committee of 

the stockholders, comprising at least three 

members, who are elected by the voting 

stockholders of a Farm Credit bank or association. As a nominating committee member, 

your responsibility is to identify, evaluate, 

and nominate at least two willing and suitable candidates for each open director position. Because a nominating committee is not 

a committee of the board, its independence 

from board and management influence is 

critical to the success of your financial cooperative and the preservation of stockholder 

control. 

Who serves on a nominating committee?

For associations, eligibility to serve on a 

nominating committee is limited to voting 

stockholders who are not directors, director 

candidates, officers, employees, or agents of 

the association. An association’s nominating 

committee members are elected by the voting stockholders at the annual meeting for a 

term of one year, although they may stand for 

re-election at the next annual meeting for a 

subsequent term. 

As with associations, eligibility for a Farm 

Credit bank’s nominating committee is 

limited to individuals who are not directors, director candidates, officers, employees, or agents of the bank. Farm Credit bank 

nominating committee members are elected 

consistent with the bank’s policy and procedures. Voting for Farm Credit Bank nominating committee members is weighted based 

on the number of each association’s voting 

stockholders, with no cumulative voting 

permitted. 

Bank and association nominating committee members may not stand for election to 

the board of directors in the same election in 

which the committee is identifying director 

candidates.

What are my responsibilities as a 

nominating committee member?

Your committee’s authority is based on Section 4.15 of the Farm Credit Act of 1971, as 

amended (the “Farm Credit Act”) and Farm 

Credit Administration (FCA) regulations at 

§§ 611.320 and 611.325. As a member of the 

nominating committee, you are responsible 

for the following:

• Reviewing a current list of the stockholders of the institution

• Determining who is eligible, qualified, 

and willing to serve as a director

• Considering if any obstacles exist that 

would prevent the director candidate 

from performing his/her duties

• Nominating a slate of eligible director 

candidates for election that includes at 

least two suitable nominees for each position to be filled 

• Preparing a written report on your efforts 

to locate director candidates

• Nominating director candidates for special elections due to mid-term vacancies 

When nominating director candidates, you 

must endeavor to assure representation on 

the board from all areas of the institution’s 

territory and as nearly as possible, all types 

of agriculture practiced in the territory. The 

nominating committee’s goal is diversity in 

director candidates in demographics, experiences, skills, and viewpoints. Diversity in 

demographics includes income, age, gender, 

and ethnicity differences. 

How does a nominating committee 

determine a person’s eligibility to serve 

as a director?

Each Farm Credit bank and association is 

required to establish and maintain a written 

policy identifying desirable director qualifications. Your nominating committee should 

consult this policy when evaluating director 

candidates. However, the Farm Credit Act requires that a candidate for an association director position must be a voting stockholder 

of the association. Many Farm Credit banks 

and associations also provide for other director eligibility requirements in their bylaws, 

such as requiring that a board member’s loan 

be in accrual status, that directors be free of 

any apparent conflicts of interest, or that age 

or term limits be met. You are encouraged to 

consult your institution’s bylaws and nominate only those director candidates who meet 

these qualifications. 

For a more detailed discussion of the role of 

Farm Credit bank and association directors, 

please review FCA’s “The Director’s Role” 
the most recent bylaws, the current policy on 

desirable director qualifications, and a copy 

of the policies and procedures that the bank 

or association has adopted to assure impartial 

elections. The committee may also request a 

summary of the current board’s self-evaluation; in return, the board may require a 

pledge of confidentiality. Under the bank or 

association’s policies, you may also obtain 

candidate biographical information and other 

similar information from your bank or association. Your bank or association’s staff can also 

assist with logistical, clerical, and administrative support to help the committee perform 

its duties effectively. 

How do I indicate interest in serving on 

my nominating committee?

Contact your Farm Credit bank or association to find out its procedures for electing 

nominating committee members. Each Farm 

Credit bank and association determines 

how candidates for nominating committee 

membership are identified. Your bank or association can tell you how you can notify the 

appropriate party of your interest in serving 

on the nominating committee.

The Role of 

Farm Credit System

Nominating Committees

This brochure is produced by the Farm Credit Administration, 

the safety and soundness regulator for the Farm Credit System.

Additional copies are available from

Office of Congressional and Public Affairs

Farm Credit Administration

1501 Farm Credit Drive

McLean, VA 22102-5090

Phone: 703.883.4056

E-mail: info-line@fca.gov

Reprinted 0107/1000

handbook, available from your institution or 

FCA’s Web site, www.fca.gov.

Remember that any eligible voting stockholder of an association may be nominated from 

the floor to stand for election. Farm Credit 

banks may also allow for floor nominations, 

but are not required to do so.

Are individuals who are not members 

of a nominating committee allowed to 

participate in that committee’s activities? 

Your Farm Credit bank or association’s current directors, director candidates, officers, 

employees, and agents are not only prohibited from serving on your nominating committee, they also cannot be present when you 

deliberate or vote on the nominees for your 

slate of director candidates. However, you 

may invite them to your meetings to answer 

questions on general matters such as director 

qualifications and duties, issues the institution will face in the future, and any specific 

skills and knowledge not adequately represented on the current board. You may also 

accept from your bank or association staff the 

names of stockholders who might be willing 

to be director candidates, although you must 

perform your own evaluation of any person 

who is recommended. You may not allow 

others to influence the nomination process 

and you must preserve your committee’s independence in selecting director candidates.

What help can a nominating committee 

receive from its Farm Credit bank or 

association?

Your Farm Credit bank or association is 

required to provide your committee with 

reasonable access to administrative resources. 

This includes a current list of stockholders,