How can your electric co-op or utility develop a well-trained and informed Board of Directors?
Major decisions in an electric cooperative or utility should be implemented by the approval of the Board of Directors (or City Council). The power and utilities industry is complex and may be unfamiliar to newer board members.
This raises an important question: How can the board be effective and understand the business well enough to make informed and strategic decisions?
Board Training Should Start on Day One and Be a Continuous Process
Training the Board of Directors (or City Council) of an electric co-op or utility is crucial for ensuring informed and effective decision-making. This training should be comprehensive and specifically tailored to the energy sector.
Training can be delivered by internal staff who are experts in their areas, or by external facilitators. A two-pronged approach can be particularly effective: external facilitators can focus on industry trends and pressing issues, while internal presenters can connect these insights to the specific challenges and strategies of the utility. Additionally, online, on-demand, and live webinars can be valuable for board member self-study.
A well-informed and well-trained board should have a training program built around these key areas:
Board members should receive regular training on current trends and issues affecting the energy industry. Topics such as regulatory impacts, technological advancements, and market dynamics will provide the foundational knowledge necessary for informed decision-making.
Understanding financial statements, capital expenditure planning, and risk management is essential for strategic planning. Since board members may not always have financial backgrounds, training sessions should include basic, intermediate, and advanced levels. Risk management training should teach board members how to identify, assess, and mitigate risk effectively.
Training should include scenario planning and crisis management exercises to prepare the board for unexpected challenges, such as natural disasters or regulatory changes. This ensures the board is equipped to maintain resilience and continuity.
Training should not be a "one and done" event. Board members should be expected to keep their knowledge and skills up to date. Training programs should be monitored, documented, and regularly reviewed to ensure they remain current and effective. Onboarding programs should be clearly defined, and board succession planning should be integrated into the board's ongoing activities.
By committing to continuous learning, the board can develop the expertise necessary for effective governance.
Board Member Training Resources
Effective board governance requires deep understanding of utility operations, financial planning, regulatory compliance, and industry trends. Our comprehensive online courses provide board members and utility executives with foundational and advanced knowledge in FERC/RUS accounting, rate design, cost of service analysis, risk management, and the AI tools transforming the industry—giving your board the expertise needed for informed, strategic decision-making.
How I Can Assist
We help electric cooperatives and utilities navigate complex accounting challenges, streamline processes, and implement industry best practices in work order accounting and system integration. Our online courses for new and experienced board members give them a foundation in industry specifics to aid them in decision-making. Let's connect to explore solutions tailored to your needs. Please contact me with any questions to discuss your goals in more detail.
Thanks for reading! I welcome your suggestions for future topics and am always eager to provide insights on pressing industry issues. My goal is to be a trusted resource for utilities and electric cooperatives navigating today's challenges.
The material in this article is for informational purposes only and should not be taken as legal or accounting advice provided by Utility Accounting & Rates Specialists, LLC. You should seek formal advice on this topic from your accounting or legal advisor.