This brochure is designed to help 

you fulfll one of the most important 

contributions you can make to your 

institution — serving on the nominating committee. By serving on this 

committee, you contribute to your 

institution’s leadership and commitment to good governance. 

What is a nominating committee? 

A nominating committee is a committee of 

stockholders who own voting stock. It is 

responsible for identifying, evaluating, and 

nominating candidates for election to the 

board of directors of a Farm Credit bank or 

association. The nominating committee is not 

a committee of the board, and its independence from the infuence of the board and 

management is critical to the success of your 

fnancial cooperative and the preservation of 

stockholder control. 

Who serves on a nominating committee? 

At an association, you must be an owner of 

voting stock to serve on the committee. At a 

Farm Credit bank, you must be an authorized 

representative of the bank’s voting stockholders. 

You may not serve on an association or Farm 

Credit bank nominating committee if you are 

a director; a director candidate; or an offcer, 

employee, or agent of the institution. 

At both associations and banks, 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. 

How large is a nominating committee, 

and how long do members serve? 

A nominating committee consists of at least 

three members, each of whom is elected by 

the majority vote of all the institution’s voting 

stockholders. An institution may have a larger committee to better represent its territory. 

It may also have a larger committee to ensure absences or recusals do not leave it with 

fewer than the minimum of three members. 

Alternates may also be used to address this 

concern. 

The term of offce for association nominating 

committee members is one year, and members may be re-elected to serve consecutive 

terms. The term of offce for Farm Credit 

bank nominating committee members is decided by each bank. 

Must all director candidates be selected 

by a nominating committee? 

Generally, director candidates are nominated by a nominating committee. However, at 

an association, director candidates may be 

nominated from the foor to stand for election. Farm Credit banks may also allow foor 

nominations but are not required to do so. 

What are my responsibilities as a 

nominating committee member? 

Your main responsibility is to nominate individuals for service on the board of directors. 

This involves the following: 

• Identifying, from the current list of stockholders and other resources, individuals 

who are qualifed and willing to serve as 

directors 

• Evaluating the qualifcations of potential 

nominees, keeping in mind the desired 

director qualifcations provided by your 

institution 

• Considering whether any obstacles exist 

that would prevent a director candidate 

from performing his or her duties 

• Nominating at least two suitable persons 

for each open position 

• Preparing a written report on your efforts 

to identify director candidates 

• Nominating director candidates for special elections that are held when mid-term 

vacancies occur 

• Keeping records of meetings 

When nominating director candidates, keep 

in mind that the board should represent all 

areas of your institution’s territory and, as 

nearly as possible, all types of agriculture 

practiced in the territory. Also, strive to nominate candidates from diverse demographics, with a variety of experience, skills, and 

viewpoints. Demographic diversity includes 

income, age, gender, and ethnicity 

differences. 

As a member of the nominating 

committee, how do I determine a person 

is qualifed to serve as a director? 

Review the eligibility requirements set forth 

in the Farm Credit Act of 1971, as amended, 

and FCA regulations. Your institution may 

also have standards for service on its board of 

directors that are contained within its bylaws 

or in its director qualifcations policy. For 

example, your institution may require director candidates to meet certain age and term 

limits. 

Consult these documents when evaluating 

director candidates. Keep in mind that each 

director-nominee must also certify he or she 

is eligible to serve as a director of the institution. 

For more information, see “The Director’s 

Role,” which is available from your institution or on FCA’s website at www.fca.gov. 
May individuals who are not members of 

a nominating committee participate in 

the committee’s activities? 

Your current directors, director candidates, 

offcers, employees, and agents are not only 

prohibited from serving on your nominating 

committee, they also must not be present 

when the nominating committee deliberates 

or votes on whom to nominate. However, 

your nominating committee may invite them 

to your meetings to answer questions on 

general matters, such as director qualifcations and duties, issues the institution will 

face in the future, and any specifc skills and 

knowledge not adequately represented on the 

current board. 

You may also accept from your directors and 

institution staff the names of stockholders 

who might be willing to serve as directors, 

although you must perform your own evaluation of any person who is recommended. 

You may not allow others to infuence the 

nomination process, and you must preserve 

your committee’s independence in selecting 

director candidates. 

What operational resources may a 

nominating committee receive from its 

Farm Credit bank or association? 

Your institution is required to provide your 

committee with reasonable access to administrative resources, including the following: 

• A current list of stockholders 

• The most recent bylaws 

• The current policy on desirable director 

qualifcations 

• Copies of the policies and procedures 

your institution has adopted to ensure 

impartial elections and to govern nominating committee operations 

The committee may also request a summary of the current board’s self-evaluation; in 

return, the board may require a pledge of 

confdentiality before allowing access to the 

evaluations. 

Also, your institution’s staff may assist with 

logistical, clerical, and administrative support 

to help the committee perform its duties effectively. However, institution staff members 

must not be present when the nominating 

committee deliberates or votes on whom to 

nominate. 

How do I indicate interest in serving on 

my institution’s nominating committee? 

Contact your Farm Credit bank or association. Your institution can tell you whom to 

notify to express your interest in serving on 

the nominating committee. 

What is the source of my nominating 

committee’s authority? 

Your committee’s authority is based on 

section 4.15 of the Farm Credit Act of 1971, 

as amended, and FCA regulations at 12 CFR 

part 611, subpart C. 

Where can I get further information 

about nominating committees? 

Check out the revised FCA Bookletter-043, 

“Guidance on Farm Credit bank and association nominating committees.” Located on 

the FCA website, this bookletter discusses the 

important role nominating committees play 

in the System’s cooperative structure. 

This brochure is produced by the Farm Credit Administration, 

the regulator of the Farm Credit System. For additional copies, 

contact FCA’s Offce of Congressional and Public Affairs at 

703-883-4056 or info-line@fca.gov. 

Revised 1119/2500 

The Role of 

Farm Credit System 

Nominating Committees