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FPO Governance structure, accountability, Board oversight best practice

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  1. FPO Governance: Importance & Structure
    1 Quiz
  2. Board Leadership: Ownership, Vision & Decision-Making.
    1 Quiz
  3. Board Matters :Composition, Tearms & Election, BOD meeting, AGM
    1 Quiz
  4. Board oversight - Independent Director Development Programme
    1 Quiz
  5. FPC Monitoring and Reporting -Governance best practices
    1 Quiz
  6. Women in FPOs
    1 Quiz
  7. FPC Internal Audit
    1 Quiz

Final Assessment

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FPO Governance structure, accountability, Board oversight best practice FPO Governance: Importance & Structure
Lesson 1 of 7
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FPO Governance: Importance & Structure

NAFPO May 30, 2025
1

INTRODUCTION:

Farmer Producer Organizations (FPOs) are collective institutions formed to enhance small and marginal farmers’ access to markets, inputs, and better financial services. Effective governance is crucial for ensuring transparency, accountability, and sustainability in FPOs. Good governance helps in decision-making, conflict resolution, and long-term success.

2

Importance of Governance in FPOs:

1
Transparency & Accountability – Clear rules and procedures maintain trust among members.
2
Efficiency in Decision-Making – Defined roles help in smooth operations and conflict resolution.
3
Legal & Regulatory Compliance – FPOs must adhere to legal frameworks like the Companies Act, 2013 or Cooperative Acts.
4
Financial Sustainability – Proper financial management and audits safeguard members' interests.
5
Member Participation – Encourages democratic decision-making and inclusiveness.
3

Governance Structure of an FPO

A well-defined governance structure includes:

General Body (GB)
  • Composed of all registered farmer members.
  • The highest decision-making authority.
  • Approves major policies, budgets, and audits.
  • Elected representatives from members.
  • Responsible for strategic planning, financial oversight, and operations.
  • Appoints CEO/Managing Director for daily management.
  • Executes decisions taken by the BoD.
  • Manages day-to-day operations, marketing, finance, and member services.
  • Formed for specific tasks like finance, procurement, or marketing.
  • Helps in focused decision-making and implementation.
4

Best Practices for Good Governance in FPOs

  • Regular Meetings – Ensuring participation and decision-making.
  • Proper Record Keeping – Maintaining accounts, minutes of meetings, and audits.
  • Capacity Building – Training members and board members in governance practices.
  • Member Engagement – Ensuring equal participation and benefits to all members.

Module Materials

Farmer Producer
Organisations
Lesson Content