Preparing For 2026: Why The NCUA’s New Succession Planning Rule Elevates The Strategic Role Of Credit Union Boards

The National Credit Union Administration’s new succession planning rule formally takes effect in January 2026. It’s an important regulatory milestone that underscores something many credit unions already know: strong, intentional governance is not optional; it is foundational to long‑term institutional health.

Although the rule requires federally insured credit unions to adopt and maintain a written succession plan for its CEO, C-suite and its board, its deeper purpose is far more strategic. It signals a shift toward more proactive, competency‑based leadership development across the cooperative system. For boards, this is an opportunity to strengthen governance practices, deepen alignment with organizational strategy, and ensure continuity in a rapidly evolving financial landscape.

To meet both the letter and the spirit of the rule, credit unions can focus on four core objectives that define effective board succession planning.

1. Establish An Ongoing Process That Is Fair, Transparent, Competency‑Based, And Inclusive. Then, Consistently Apply It.

Succession planning cannot be a one‑time exercise or yield a document that simply sits on a shelf. It must be a living process — one that is structured, malleable, and grounded in fairness and transparency.

A competency‑based approach ensures that director recruitment and development are tied to the skills and behaviors required for effective governance. When applied consistently, this approach builds trust among board members, reinforces the cooperative values of inclusion and equity, and supports leadership continuity during periods of transition.

2. Curate A Board Aligned With The Credit Union’s Strategic Goals

A high‑performing board is not simply a collection of well‑intentioned volunteers. It is a strategically curated leadership body whose collective skills, characteristics, and attributes align with the credit union’s long‑term direction.

This requires boards to:

• Consciously identify the competencies needed to advance the credit union’s strategy.
• Regularly assess board members’ current strengths and overall gaps on the board.
• Intentionally recruit directors who bring the right mix of expertise, lived experience, and perspective.

By purposefully shaping board composition, credit unions position themselves to navigate emerging risks, identify and then seize strategic growth opportunities, and remain relevant to the members they serve.

3. Build A Learning Culture Through Robust Evaluation And Ongoing Education

The new NCUA rule reinforces what strong boards already practice: learning is not optional for governance excellence.

A culture of continuous learning includes:

• Regular, structured board and individual director evaluations.
• Honest reflection on performance and effectiveness.
• Targeted education that strengthens governance competencies for the board as a whole and for individual directors.
• Opportunities for directors to deepen their understanding of industry trends, regulatory expectations, and strategic issues.

When boards embrace learning as a shared responsibility, they elevate their collective performance and strengthen their ability to guide the credit union through complexity and change.

4. Reinforce Accountability By Addressing Concerns Raised in Assessments

Evaluation without follow‑through is merely an exercise in futility. Effective succession planning requires boards to act on what assessments reveal — whether those insights relate to skill gaps, behavioral concerns, or opportunities for improved collaboration.

Addressing issues directly and constructively requires a culture of accountability. It also ensures that board service remains a meaningful, high‑impact responsibility aligned with the credit union’s mission and member expectations.

The NCUA’s succession planning rule is more than a compliance requirement. It is an invitation for credit unions to strengthen their governance frameworks, invest in leadership continuity, and build boards that are prepared for the future. In short, it can turn what can often be a risk for many into a strategic advantage.

By embracing fair and transparent processes, curating strategically aligned leadership, fostering a culture of learning, and reinforcing accountability, credit unions can turn this regulatory moment into a powerful catalyst for long‑term organizational resilience.

Quantum Governance is an L3C, a low-profit, limited-liability service organization, founded more than a decade ago and dedicated to the public good. Its experts in governance and strategy help organizations realize the full potential of their missions via assessment, consulting, planning, facilitation, and implementation services to mission-driven organizations of all sizes.