This project analyzed 82 annual financial reports (2006) of Agricultural Credit Associations which create the branches of Farm Credit Services. The goal of this research is to determine the impact additional board members and their level of compensation have on the effectiveness of ACA’s. The data collected shows evidence that a positive linear relationship between the compensation of the board of directors and the overall productivity of each firm exists. The results are based on the comparison of company assets, return on assets, liabilities, owner’s equity, return on equity, net income and total loans. These factors have been compared to the number of board meetings per year, the compensation of board members, and the size of the cooperative board. The key components in proving the hypothesis were board compensation, board size, total loans, and gender. A large percent of the associations follow the null hypothesis, which was first thought to be that there would be some connection between finances and board of director compensation.


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