Have you ever found yourself in need of a quick decision from your Board? Tempted to get an answer by email vote? Haven’t we all…but it’s not that simple!
Unlike a board vote in-person or by teleconference, there are special rules that pertain to email voting in 44 states (BoardEffect Research Report: U.S. Laws Governing Nonprofit Boards and Electronic Voting, March 2012, Isabelle Clérié and Dottie Schindlinger). Most require participants to “hear each other” or “communicate concurrently” – and neither test is met by email exchanges.
What is the thinking behind these rules? In order to meet their Duty of Care, board members need to properly deliberate matters before them. This includes considering and, where appropriate, discussing the opinions of their fellow board members to come to an informed conclusion. Proxy voting on board matters is prohibited for similar reason – the person casting a proxy vote hasn’t considered new information that might be brought to the table by other board members.
But here you are with a matter that needs a board vote now, and your next board meeting is weeks away – what do you do?
By meeting certain conditions, you can ensure the validity of an email vote. First, every member of your board must respond to the call for a vote, in writing (by email) – so you will have to chase down any laggards. Second, the vote must be unanimous (less any legitimate recusals or abstentions, such as for conflict of interest), allowing the board chairman to declare the motion passed by unanimous written consent. Finally, the board should affirm the email vote at your next meeting so it is recorded in the minutes.
What recourse do you have if there is not unanimous consent? Because everyone can “hear” and “communicate concurrently,” teleconferences only require that a quorum be present for the discussion, and a majority vote carries the motion. Or you can of course call an interim meeting of the board. But in either case be sure you follow your bylaws regarding required meeting notice!
is Kansas one of the 44 states?
Yes. The complete list can be found at http://www.boardeffect.com/wp-content/uploads/2015/01/Electronic-Voting-Report-FINAL.pdf.
Do E-mail committee votes Also have to be unanimous?
Committees don’t carry the same duty of care that boards do, so they do not.
I am Judy Sampson President of the Pembroke Chamber of Commerce in Pembroke NC. We have been approved as of Sept 24th for the Pembroke Chamber of Commerce Foundation. Do I have to have the same board of directors? Since I am the President of the Pembroke Chamber of Commerce who submitted the application will I also be the Executive director and President for the Foundation? Need some mentoring on the Foundation management/bylaws Thanks Judy
Judy –
This is more of a conversation than an email answer. I will give you a call later today.
Claire
Good read — thanks, Claire! And nice “seeing” you. Now I have to go check out my state’s rules. Appreciate the heads up!
Hi Claire, just read your article and it is definitely relevant here in California which is one of those 44 states you talked about. I concur based on reading our state’s (California) statutes that email votes must be 100% unanimous and also with 100% response rate from the sitting board. That makes votes by email a bit tricky if you have any board members who are disengaged or semi engaged and don’t respond when you are really counting on them.
Two strategies I have used to overcome this with client associations are, as you mentioned, calling a teleconference, which meets our state’s definition of a meeting with two way communication in real time and only a quorum required for binding resolutions. The other strategy we’ve facilitated is empowering either the president/chairperson or executive leadership with the ability to make timely decisions via delegation in the Bylaws, which must be followed up with ratification by the entire Board at their next meeting. It isn’t structured as a license for the executive leadership to do as they please though… their actions only follow consensus via email of the sitting board. After all, their decisive actions must later be ratified by board quorum, so it guarantees some accountability that their actions must reflect a later quorum decision of the board.
In this day and age, sometimes split second decisions must be made. If you don’t have a means for the organization to act when moments count, you are at a major disadvantage. Where it becomes most relevant is in crisis situations. This is almost a perfect segue to another great topic, which is leading your chamber/association through a decision process in a crisis situation.
Can you send a proxy form and e -signature via e- mail ?
Trish
What about voting with a Facebook poll?
Can a 5013c fill a board vacany via email vote to the other board members in Massachusetts
Can a Board member cast a vote for their spouse to fill a vacant seat on the board?
Does this vote have to be unanimous
The origination by laws calls for a majority vote
Does that still apply?
Any board action, including filling a board vacancy, can be taken by email as long as its unanimous with all board members voting. Your bylaw requirement for a majority vote is trumped by state law requiring unanimous written consent.
I would strongly advise against having two spouses on the board, but there’s nothing that precludes it.
Is Virginia one of these 44 states?
Yes.
In fact no matter if someone doesn’t understand then its up to other viewers that they will help, so here it occurs.
2021 – This recently came up in a 501c3 non-profit I chair; our legal counsel reads this differently. We have one board member who has received the emails but consistently does not respond. Every other board director responds and votes affirmatively. We have opted to go ahead with the actions. So far no one has challenged our decisions.
Have any of the laws changed for email board votes since you wrote your blog. We are in the stat of Hawaii. Our board seems to want to vote by email and ratify at the meeting, therefore eliminating any won’t participation/discussion. All BOD’s live in the complex and are easily accessible.
Thank you
The desire to eliminate discussion is exactly the reason these laws exist. The board’s duty of care requires a thorough discussion of issues to ensure all sides are heard before they are voted on.
I looked up Hawaii’s nonprofit statute, and the pertinent clause is 414D-144 Action without meeting. It clearly requires that all members of the board concur in writing, then sign a written consent that is filed with the board minutes.
Hi Claire,
I’m on the Executive Board of a nonprofit in Texas. Our bylaws state the following which is consistent with Texas law.
Section 2: Electronic Meeting:
Board of Directors, Executive Committee, Standing and Special committees are authorized to meet by telephone conference or through other electronic communication media as long as a quorum is present and all the members simultaneously participate during the meeting.
Section 3: Electronic Voting:
Any vote of the **** may be conducted electronically provided all authorized members are included and the vote/decision is ratified at the next regularly scheduled meeting of that body.
It appears that we have been overlooking that section of our bylaws and conducting business by email instead of simultaneously when we are apart from our in person scheduled meetings. The most recent involved the Chair presenting a contract for approval with an almost immediate motion and second prior to discussion. We did end up with a lengthy discussion over the course of 36 hours with the chair then sending out a Google form for voting. She reported that the ayes have it but some thought changes had been made to the contract as a result of the discussion (they had not as an amendment to the motion had not been made) We are set to ratify the electronic vote at our next meeting. A couple of questions
1. Is the vote valid since it was by Google form and not unanimous?
2. Is the business and vote valid since we did not follow our bylaws for structure of electronic meetings?
3. Can a member change their vote from the Google form to when in-person ratifying the vote?
I cannot seem to find a list of the 44 states with rules pertaining to electronic voting. Can you provide an easy link? The link you provided for boardeffect.com did not have the info. I’ve also tried to google the answer and can’t locate it. Thank you.
Hi Anne,
You should be able to find the list here: http://www.boardeffect.com/wp-content/uploads/2015/01/Electronic-Voting-Report-FINAL.pdf.
Does North Carolina allow for email voting for Boards? I thought I saw no, but that was information from several years ago. Thank you.
Hi Catherine,
The most recent information we have is the report from a number of years back. I can check with Claire Louder, the author of the blog, to see if she has any updated info. Thank you.
I just double checked – there was an update to NC law last fall. It still requires unanimous written consent for email votes (as described in the earlier blog post) but no longer requires that be specifically allowed in your bylaws as was previously the case.
Here’s a link from NC Nonprofits that explains the policy change: https://www.ncnonprofits.org/blog/new-options-electronic-voting-boards-and-remote-membership-meetings.
Can a Florida Board vote on opening a CD thru email and then ratify it at the next BOD meeting? This is an HOA.
HOA regulations vary from state to state, and are not my area of expertise. But as long as you have a unanimous email vote by the board, and confirm the vote at your next board meeting, you should be fine. We used that method frequently fora South Carolina HOA board I served on.
Has the laws for electronic voting changed in Kansas since you wrote this blog? It appears that it is not allowed.
What can one do if their board isn’t following this?
The first step would be to educate them about fiduciary duties (this falls under Duty of Care) and state law on this topic. If you have a board attorney it would be best coming from them, but you are also free to share my article. I’m not an attorney, but I’ve been a chamber and association exec for years and facilitate board orientations on exactly these issues.
Hi Claire
Do you have samples of how the votes that had to be taken by email be written on the next meeting agenda or minutes? Thank you
They should be noted as “approved by unanimous written consent on (date).” Probably a good idea to keep the email exchange showing all the votes in case the decision is questioned, but I don’t think it’s legally necessary. However I’m not an attorney – confirm with your board counsel.