The notion of member value is a frequent discussion topic as we meet with credit union CEOs, boards and senior management teams. Some credit unions, generally including those that most enthusiastically support the credit union philosophy, recently seem to have a renewed emphasis on this topic and are beginning to include even more objectives in their strategic plans to ensure their support of members and their communities. However, most of these credit unions really struggle with finding ways to measure member value, partly because of the cooperative ownership structure of credit unions.
I would maintain that you can’t measure member value directly using any balance sheet and income statement metrics, unless you assume the members could work together to liquidate the credit union at some future time and divide the credit union’s capital among themselves. Instead, measuring member value boils down to a complex function of a number of quantitative and qualitative factors.