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Do we have to follow Robert’s Rules?

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If your organization’s bylaws say your meetings will follow Robert’s Rules of Order, then yes, you do have to follow them—but do you follow them? Robert’s Rules are complex! It is very difficult to follow them to the letter unless you have a dedicated parliamentarian available. I’ve been on quite a few boards and none of them truly followed Robert’s Rules.

Robert’s Rules provide a method for making group decisions, but there are alternatives that may better serve your board of directors. Here are some examples.

Consensus Decision-Making: This approach involves discussion until all participants can agree on a single course of action. It emphasizes cooperation and collaboration, seeking to address concerns and find solutions that everyone can support.

Consent Decision-Making: This approach involves seeking consent from all members for a proposed course of action. Instead of requiring full agreement, consent decision-making aims to ensure that no member has strong objections to the proposed action.

Democratic Voting: Similar to Robert’s Rules, democratic voting involves members casting votes for different options, and the option with the majority of votes wins. However, the rules and procedures may be simplified compared to Robert’s Rules.

Each of these methods has advantages and disadvantages. I encourage you to check out thedecider.app. It’s a cool tool to help you choose a decision-making model that suits the decision your group needs to make.

And don’t forget! If you decide to adopt a different method, don’t forget to revise your bylaws accordingly.

Annual Meetings

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As a self-perpetuating board with no voting members, must we hold an annual meeting?

To answer that question, first be sure to see what your bylaws say. Bylaws typically have provisions about meetings. If your bylaws call for an annual meeting, you have your answer.

The exact phrase “annual meeting” does not appear in the California Corporation Code for public benefit corporations. However, there is a specific, relevant requirement in Section 5510: “A regular meeting of members shall be held on a date, time, and with the frequency stated in or fixed in accordance with the bylaws, but in any event in each year in which directors are to be elected at that meeting for the purpose of conducting such election, and to transact any other proper business which may be brought before the meeting.” CA Corp Code 5510

If a board meets regularly, you could simply designate one of those meetings as your annual meeting. Unless your bylaws say otherwise, It does not need to be a separate meeting in addition to your regular meeting schedule.

That said, why not have an annual meeting? It can serve a number of useful purposes! Check out:

Requirements for Nonprofit Annual Meetings | Nolo

How to Plan an Effective Annual Meeting for Your Non-Profit

Who Can I Add to Our Email List?

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If someone gives me their email, may we add them to our email list? Or if someone has their email on their public website, may we subscribe that address?

We all want to build our contact lists to be sure we get the word out about the great work our nonprofits are doing and how people can be involved. That said, there are legal requirements you need to know and follow.

First, it is simply a best practice, and often legally necessary, to get permission from people before adding them to your list. If you’re having a conversation with someone, ask, “May I add you to our email list?” Odds are, they will say yes. If they say no, you probably wouldn’t want them on your list anyway. The main point is don’t assume because the person happened to share their email with you for some purpose that it’s OK to subscribe them to your list.

What about those email addresses you find on an organization’s website? Clearly, the emails are there for use by the public to communicate with the organization, but that doesn’t give you permission to subscribe them to your email list. You might, however, send them a single email that explains why you think they might want to receive your emails, and include a link for them to subscribe themselves.

Even when you have permission to include a person’s email in your list, be sure each of your marketing emails (e.g. your newsletter, announcements or programs or fundraisers, etc.) includes a link for people to opt out of receiving future emails.

Resources for further information:

Badly managed charity?

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What recourse does a member of the public have if there are concerns about how a public-benefit corporation is being run?

If you have reason to be concerned that a charitable nonprofit is being poorly managed, or worse, is somehow engaged in wrong-doing, there are several steps you can take.

First, educate yourself as much as possible. You want to be sure you are not misinterpreting or misunderstanding what’s going on. Ask questions. Talk to others involved with the organization. California law requires nonprofit corporations to provide certain documents, such as the organization’s application for tax exemption and annual informational returns, upon written request. If the organization refuses, this may be grounds for further action.

Familiarize yourself with the relevant sections of the California Corporations Code, especially those related to nonprofit public benefit corporations. This code outlines the legal requirements and obligations of such organizations.

Look up the organization’s records on the Secretary of State’s and Attorney General’s websites. Each has a simple search tool. You’ll be able to see if the organization is up-to-date with its required documents and filings.

Ultimately, if you are convinced there is something wrong, or if the organization refuses to provide the required documents, you may file an official complaint with the Attorney General’s office.

Investing your reserve funds

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Our board is looking to know legalities a nonprofit board should be aware of in deciding how to handle or invest a financial reserve.

When one of our nonprofits approached Spokes for help with that topic, our first reply was, “We are not attorneys, tax experts, or financial advisors.” That said, we can offer practical suggestions based on our experience with the many nonprofits we serve.

The most important thing to keep in mind is the board’s fiduciary responsibility to the organization. As part of that responsibility it must act with prudence and with the organization’s best interests in mind.

California has adopted the Uniform Prudent Management of Institutional Funds Act (UPMIFA), which provides guidelines for the investment and management of nonprofit institutional funds. It includes eight factors to consider:

  • General economic conditions.
  • The possible effect of inflation or deflation.
  • The expected tax consequences, if any, of investment decisions or strategies.
  • The role that each investment or course of action plays within the overall investment portfolio of the fund.
  • The expected total return from income and the appreciation of investments.
  • Other resources of the institution.
  • The needs of the institution and the fund to make distributions and to preserve capital.
  • An asset’s special relationship or special value, if any, to the charitable purposes of the institution.

In San Luis Obispo County, some of our smaller nonprofits with surplus funds have placed them in FDIC-insured certificates of deposit with varying terms to ensure that funds are available when needed. Nonprofits with greater reserves will want to adopt a sound investment policy in line with UPMIFA.

Learn more about UPMIFA.

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