Fair and equitable owner representation on the CHS Board of Directors is a top priority. We regularly evaluate the number of Directors per region to determine whether there has been enough change in our owner base to adjust regional representation. Changes were identified based on the established protocol and CHS members approved related amendments to the CHS Bylaws at the 2023 CHS Annual Meeting. Review the amendments.
From the CHS Board
The number of Directors per region on the CHS Board of Directors is prescribed by the CHS Bylaws. Each year, we compare the number of Directors per region to our owner base to determine whether there has been enough change in our owner base to adjust that regional representation.
- Board policy provides that if that comparison determines a region exceeds its given number of Directors by at least 0.85 for three consecutive years, the threshold is met to add a Director to that region.
- Because the total number of CHS Directors is set at 17 per the CHS Bylaws, if one region gains a Director, another region must lose a Director.
Representation changes needed
Those regular assessments have now identified the need to adjust Director numbers in two of the eight CHS regions:
- Region 7 has met the threshold of more than 0.85 for three consecutive years (2020, 2021 and 2022), so is eligible to have a second Director. Region 7 includes Alabama, Arkansas, Florida, Georgia, Iowa, Louisiana, Mississippi, Missouri, North Carolina, South Carolina and Tennessee.
- The offsetting Director position will come from Region 1 (Minnesota), dropping from four to three Directors. This change would be accomplished through Director retirement.
Timing and transition
- CHS members approved the amendments at the 2023 CHS Annual Meeting in early December.
- The amendments will be implemented at the 2024 CHS Annual Meeting as a second Director is elected for Region 7 and one Region 1 Director retires.
Answers to frequently asked questions about the amendments
We review Director representation each year and have been tracking the number of increased votes in Region 7. Since Region 7 met the three-year threshold for an additional Director, we recommended CHS Bylaws amendments to increase the number of Directors in Region 7 from one to two.
The same comparison used to show changes in the CHS owner base that triggers adding a Director in Region 7 showed decreased votes per Directors in Region 1, making it the offsetting region, since the total number of CHS Directors is set at 17 per the CHS Bylaws.
Since they were approved at the 2023 CHS Annual Meeting, the amendments will take effect at the 2024 CHS Annual Meeting. At that time, one Region 1 Director will be retiring per our Bylaws regarding Director age and that is the seat that will be removed in Region 1 to offset the additional seat in Region 7.
While we expect our ownership base to continue to change over time, the representation formula and protocol for making Director allocation changes moves slowly, due to the three-year requirement to trigger a change and vote allocations based in part on three years of average sales figures per owner. We will continue to monitor annually and recommend future changes as dictated by shifts in our ownership base and per the protocols we have in place.
As our company continues to evolve, we will consistently review our foundational governance documents, such as our Articles of Incorporation and Bylaws, as part of good governance. If needed, the Board will recommend changes to reflect that evolution and CHS owners will decide whether to approve those recommendations. It’s impossible to predict how often those changes will be required, but a dynamic, vibrant organization needs its governance documents to keep pace with that growth.
You can share questions or comments with any of the CHS Directors and you can send your questions or comments in an email to feedback@chsinc.com.
Have a question or comment about the proposed amendments?
Email the CHS Board
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