Recently, a question came up on a national nonprofit list serve about whether boards can and/or should make decisions through unanimous consent by email. Here was my response.
“Since this is a national question and I’m only licensed in North Carolina, what follows is not specific legal advice. Instead, let me provide a general discussion based on my many years of assisting boards as a parliamentarian and attorney.
Most states have adopted some version of the model Nonprofit Corporation Act from the American Bar Association. The most recent is the Fourth Edition, but few states have moved to that. Membership decisions and board decisions have historically been treated differently. For decades, even though members could not make virtual/electronic decisions, boards have been able to meet telephonically or electronically so long as all board members could hear and speak to each other. As fiduciaries, boards were expected to consider and deliberate before making decisions. Also, due to the smaller size, it was anticipated that boards could gather much easier than the members at an annual meeting.
So, with that as background, boards were given several options for making decisions under the different versions of the model Nonprofit Corporation Act.
(1) Get together in person with a quorum present to discuss and vote on issues. (2) Meet telephonically or virtually (so long as everyone could hear and speak to each other) either with some members in person or all members electronically with a quorum present to discuss and vote on issues. (3) Due to the need of boards to make emergency decisions or quick decisions, an option was also provided for “action without meeting,” in which ALL board members could consent to something in writing. (Most states also allow members to follow such a process, but the larger membership makes the process impractical.)
- Get together in person with a quorum present to discuss and vote on issues.
- Meet telephonically or virtually (so long as everyone could hear and speak to each other) either with some members in person or all members electronically with a quorum present to discuss and vote on issues.
- Due to the need of boards to make emergency decisions or quick decisions, an option was also provided for “action without meeting,” in which ALL board members could consent to something in writing. (Most states also allow members to follow such a process, but the larger membership makes the process impractical.)
The requirements for boards tend to include one or more written consents signed before or after the action that is then filed in the minutes as a decision. Again, 100% of ALL board members tends to be required and not just 100% approval of those voting. The concept is that if no member of the Board has objection to the action, there is no minority position to protect. And if one member cannot or will not sign, it should be easy to get a quick board meeting together, whether in person or phone/virtually. (And if one or more board members will not sign, the board SHOULD get together to discuss.) Because of the language about a “written consent,” many states have permitted or amended their statutes to make clear that photographs or scans of written consents or even email consents are sufficient.
Now a couple practical/political thoughts. We have some boards that are tempted to use action without meeting for everything. There are several concerns with that. One, for organizations that permit it, members can often attend and listen to board actions and this process bypasses that. So members are often “suspicious” of boards that regularly use action without meeting (and we’ve seen litigation over that). Also, such a process completely removes the deliberation process, which works quite well. I’ve seen actions that while they would have been adopted unanimously in writing, the board getting together and discussing the issue resulted in a slightly different and better alternative. Finally, if any decision is likely to end up in litigation or get the organization in the newspaper, we do not recommend action without meeting. A properly called board meeting with a quorum present with deliberation is almost always more legally defensible than a signed consent and no meeting.
If of interest, you’ll find many free charts and articles on meeting procedure and Robert’s Rules at www.jimslaughter.com. Also, there are many membership and board meeting articles under the parliamentary articles on this blog site.”