Does Proxy Voting Work for Non-Profits?

The recent remaking of the non-profit corporate law statutes has cemented the concept of proxy voting into the lives of non-profit and charitable organizations.  So it’s time that you familiarize yourself with proxy voting if you haven’t before.  Proxy voting is a mechanism for a member of a voting body to delegate his or her voting right to another person.  In the context of nonprofit corporations on this side of the 49th parallel, voting bodies do not include the board of directors, only the members.  Our friends to the south allow directors in various states this luxury as well.  I would suggest that is fraught with danger, but that’s a topic for another day. 

In the world of proxies, the member can grant the proxy by signing an appointment form.  The person appointed can either be another member or not, depending upon the by-laws of the organization.  The proxy’s authority is generally limited to a specific meeting or decision and the appointment is revocable by the principal.
Generally, rules of parliamentary procedure prohibit nonprofit members from voting by proxy.  The rationale is that “. . . proxy voting is incompatible with the essential characteristics of a deliberative assembly in which membership is individual, personal, and nontransferable.” See, Robert, Henry M. (2000). Robert’s Rules of Order Newly Revised, 10th ed., p. 414–415.  So, nonprofit corporations that previously incorporated parliamentary procedures such as Roberts Rules of Order into their bylaws indirectly prohibited proxy voting as a result.  New corporate law statutes are overriding this principle.  Member driven organizations, such as churches or clubs, which have a higher expectation of membership engagement than the membership expectations of other organizations, may not appreciate this new revision. 

Organizations with attendance mandates may be inadvertently limiting the use of proxy voting if their by-laws have attendance policy specifying minimum attendance requirements. For instance, if the bylaws script that a membership can be cancelled for missing three consecutive meetings or a certain percentage of meetings during the year, proxy voting will be discouraged. 
 
David van der Woerd
David van der Woerd
P: 905.572.5803
dvanderwoerd@rossmcbride.com