How (and whether) to act without a board meeting

I’m a strong advocate for making all group decisions in live meetings, whether in person or by phone. This is a basic principle of parliamentary law, and it is even more important in the context of a religious organization that invites divine guidance through individual participants in decision-making.  But some groups and some situations simply do not allow for that live meeting. What to do? Act by written consent.

 Why require live meetings?

Under traditional parliamentary law, including Robert’s Rules of Order Newly Revised (11th ed.) (R.O.N.R.), “the business of an organization or board can only be validly transacted at a regular or properly called meeting” unless the governing documents provide otherwise. R.O.N.R. § 9, p. 97. Robert’s Rules defines meeting as “a single official gathering in one room or area.” Id.

The key characteristic of a proper meeting is the provision of “at a minimum, conditions of opportunity for simultaneous aural communication among all participating members equivalent to those of meetings held in one room or area.” Id.  The reasons for this emphasis on live interaction include the capacity of individuals to be swayed by each other’s contributions, people’s ability to communicate more effectively by tone of voice than written word, and the flexibility permitted when participants can provide input to shape the decision rather than adopt or reject a single direction.

If your organization's bylaws don't explicitly address acting without a meeting and adopt Robert's Rules as the parliamentary authority, your organization doesn't allow it, even if your state's law does. Before adopting governing documents allowing for decision-making without a live meeting, consider the weight that traditional parliamentary principles give to that particular kind of deliberative process. For religious organizations, consider as well the theological perspective of how your tradition perceives the role divine inspiration plays in decision-making. For more about electronic meetings, check out my earlier post on the subject here.

Deciding without a board meeting

Whether a nonprofit organization, religious or otherwise, is permitted to make decisions without live meetings will depend on state law, if the organization’s own bylaws don't forbid it. When allowed, a written consent distributed to all who are eligible to vote on the question will very likely be required. State law may have requirements for the contents of the consent. It will likely permit the organization’s governing documents (e.g., bylaws) to alter the state’s standard.

The Third Edition of the Model Nonprofit Corporations Act, compiled in 2008 by the Nonprofit Organizations Committee of the American Bar Association’s Business Law Section, allows for a nonprofit’s board to act without meeting. Action requires written consent by every director. See § 8.21(a). In other words, if one board member objects or simply fails to return the consent form, the action is not taken.

The Model Act requires that the written consent describe the action to be taken. It also requires that each director deliver the consent to the nonprofit corporation. It states the effective date is the time at which all directors have delivered signed consents unless the consent states a different effective time.

States have adopted variations to the Model Act, so make sure to consult your state’s law. Better yet, ask a lawyer. In Indiana, for example, Ind. Code § 23-17-15-2 requires the consent to be in writing, to describe the action taken, to be signed by all the directors, and to be filed in the corporate records (e.g., including them in the corporation’s minutes). The action taken may be treated as any action approved at a board meeting and is effective either when the last director signs the consent or the effective date included in the consent.

Putting actions without meetings to work

Now that I've warned you that acting without meetings is usually a bad idea and explained how, if you must, how it is permitted, you're probably wondering how you might make it work in the real world.

First, there are a few considerations I encourage you to consider. For example, how confident are you that you can get unanimity on the question? Are you sure you need board approval for the action in the first place? Why do you think it would be quicker to take the action without a meeting rather than schedule a brief conference call? Are you sure others don't have anything to contribute to the proposal?

Now, the days of using mail or even fax to obtain all those signatures is long gone. Remember that individuals can use an electronic signature to indicate their agreement. The U.S. Code defines an electronic signature as "an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record." In other words, it could include various ways of "making your mark" on an electronic document.

I'll describe four ways to accomplish collecting everyone's signature by electronic means. The first is to circulate by e-mail a document for each person to print, sign, and scan. Second, you could circulate a similar document that allows each person to enter their own typed signature or even a digital signature. Both of these would probably be most smoothly conducted by a single person contacting each board member one at a time. They could also be done by each person who adds a signature sending everyone the updated copy, but this might fill board member's boxes in organizations with large boards.

Third, you could describe the action in a document or even in the body of an e-mail message and have board members reply in a manner that qualifies as an electronic signature. The definition provided above is very broad, so there are many options. I recommend you require some amount of input analogous to a signature. It should require more than clicking "reply" or even selecting a radio button. For example, I might reply to a group e-mail and type "/s/ Josh S. Tatum." This has the advantage of speed, but it is also more clunky when you're assembling all the signatures for the finished document to file. You will likely end up attaching a separate e-mail to the consent for each board member.

Fourth, you could create a document and use one of various software applications that allow a person to insert a digital signature, which can be more secure. (I found an article rounding some of them up here.) If you find an application that everyone can use easily, this is a fine, secure method. But the hard part is finding the right app.

Finally. because all of this can be a bit overwhelming, I recommend that your organization decide whether it will allow making decisions without meeting at the outset and include that decision in the bylaws. Where permissible, include some details about the method by which those decisions must be made. Include the percentage required to approve a vote (likely unanimous by default). This should be a very high percentage to protect minorities. I recommend at least two-thirds if unanimity is not possible. Also include the method of voting.

Have a question about legal issues affecting religious organizations?
Let me know at questions@lawmeetsgospel.com or @LawMeetsGospel.