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Reni -
I did not mention Article VIII, Section 11 because I could not find when the Board voted on this issue, so consideration of this aspect is moot.
If someone can find a relevant motion, an examination of the vote could raise this issue.
Otherwise, we are left with Article VIII, Sections 12 - the part related to actions taken without prior Board approval.
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quote:
Originally posted by reni
posted by Janet
"the only action that the Bylaws specify is that a Director cannot vote at any board meeting on any issue in which such member has a conflict of interest ."
If there was a vote and the V.P. did not disclose than I believe,
Section 11 (Conflict of Interest (B) would apply... "Any after the fact disclosure of a conflict of interest on the part of any Director shall result in the nullification of any relevant vote of the director and SHALL be grounds for dismissal from the Board."
Our bylaws state that the Board SHALL annually adopt a Conflict of Interest POLICY.
Most COI policies have 7 basic sections , including process and procedure.
"Disclosure" is an important part of the process.
Was this procurement done without a Board vote?
Was the V.P. acting in her capacity as GM ? (still conflict of interest)
Does the GM have Board authorization to purchase up to a specific dollar amount without the board's approval?
I will again state what I posted on the previous page:
The VP had packets for the membership at the last Board meeting.
The packets included most of the allegations made against the VP and evidence to prove these allegations were false. There was a stack of the packets at the sign in table and during the meeting the VP read the opening sheet and referenced the evidence attached. This should be in the minutes once they are approved next month and then posted.
The evidence included emails and invoices from BJ, Mullinex, the President. BJ hired the website person and contracted to pay her. This was done by the President. Not by the VP.
The President did not clear rhis with the board. The President did not get a vote on this.
I believe there is a $1500 limit to what the GM can spend without going through the board. I am NOT sure on this. I remember hearing this discussed regarding the refrigerator purchase.
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quote:
Originally posted by Orchidlandguy
From the evidence packets provided by the VP at the last Board meeting:
Emails indicate that the website was contracted and negotiated by BJ Mulinex alone. The VP was not involved. BJ did the hiring without board approval.
I'll reiterate, no board vote to change our website, no other bids sought, no board vote in a meeting to hire anyone=no disclosure=dismissal. Reni, good work, you hit the nail on the head. Only the board can do the dismissal.
None of you will be able to find anything in the minutes except a rep's response when an association member asked about our website during a morning October board mtg. No specifics were given except that they did hire someone and it was someone they liked who lived in Calif. VP sat quiet at other mtgs when the question came up again and again. Not behavior of someone who's supposed to be transparent.
It's a conflict of interest for the VP period bc it was her niece who was hired. Pointing the finger at the Pres doesn't change that. The VP recommended her niece to certain reps on the board to do the job. How else would they know about her and then hire her? Hello?
You're right Orchidlandguy..there's a $1500 limit on the GM's expenditures w/out board vote. So $3000 expenditure w/out board vote violated our bylaws.
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Thank you Mermaid, Janet and Orchidlandguy for answering my questions and providing more details.
Based on the information provided here, I would agree with Janet's position that there has been a violation of Article VIII, Sections 12 ( actions taken without prior Board approval.)
And if there was no Board vote taken , then I do believe that Janet is "technically correct" in stating that no conflict of interest exists.
I know this may sound strange but let me try to explain why I agree that "technically" "No conflict of interest exists".
Page 6, section 14 "conflict of interest" includes the following language...
"an indirect financial interest shall include financial benefit to a relative of any director, officer, committee member or employee when so determined by a majority vote of the board OR BY POLICY ESTABLISHED under Article VIII, Section 11.
If there was no vote taken and we have no policy, a conflict of interest can not be deemed to exist!
Our bylaws clearly state that we must adopt a conflict of interest policy annually, indicating the importance of the policy.
Further , Section 11 (Conflict of Interest (B) states, "Any after the fact disclosure of a conflict of interest on the part of any Director shall result in the nullification of any relevant vote of the director and SHALL be grounds for dismissal from the Board." In other words, non disclosure is grounds for dismissal ! And yet, the adoption of this policy is ignored year after year.
Think about the past , the bickering, accusations, total loss of trust. So much of it had to do with failure to adopt a Conflict of Interest Policy and follow the procedure as outlined in the policy. It appears that we are continuing down the same road today.
Same movie, only the cast of characters has changed.
The National Council of Nonprofits consider this policy "perhaps the most important policy a nonprofit board can adopt" I agree.
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Our bylaws define specifically what a conflict of interest is and it's enforcement. Therefore, it's my belief that it's enforceable whether it's adopted annually or not. We're not starting from square one every year.
Perhaps the annual adoption could be more about bringing it to our attention annually should any "updates" be required??? Not make it null and void and unenforceable as suggested. That doesn't make sense.
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I am somewhat perplexed by the sudden concern about "conflict of interest" issues. This was brought to our attention at the Special Membership meeting. None of the then newly elected board of 2 months had signed this agreement which is part of their obligation to us members. They had already appointed(not elected) a new office secretary of less qualifications and abilities as the one they fired, had Roseann's husband in the shop taking inventory stating things were missing but in the same breath said there was no inventory and later became the interim GM's assistant with a credit card, and the treasurer was doing our books and was her own over site. This is just a few of the conflicts of interest. Nothing has been done according to the by-laws or State statutes for 10 months. Though I totally agree that with the conflict being discussed, in respect to the other gross conflicts, this one seems pretty low on the totem pole and just another one to add to the very long list of egregiousness. I am pretty appalled at what Watchdog said about Ruth taking over the GM's office. No board member needs an office and to do what? The GM needs to be the one running the show and he can't see if the office staff is performing their duties appropriately in the shop.But Mac Nut,you are probably right. It is probably far friendlier out in the shop. I fear all this craziness will chase off this much needed employee. I have wondered where these problematic board members came from as I don't remember seeing most of them before they were elected. How can the ones who were behind all this cruel chaos rest at night.
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Mermaid writes,
"Perhaps the annual adoption could be more about bringing it to our attention annually should any "updates" be required??? Not make it null and void and unenforceable as suggested. That doesn't make sense.....
Aloha,
Our bylaw book has a brief definition of when a Conflict of Interest exists.
The definition is left to interpretation.
A policy has several components.
For example,
it's purpose , a more thorough definition of what constitutes a "conflict of Interest", the criteria involved in determining whether a conflict of interest exists, an outline of the procedure, including "the vote" by all board members, the required record keeping of the procedure , how and when the records are made available to the members. It could also state the consequence to those who did not report the potential of a conflict of interest to the board prior to the goods or service be voting on.
It is mandatory that we adopt a conflict of interest policy annually (July).
What most non profits do is include this item on the agenda,
discuss their existing policy for any possible questions or changes, insure that any new statutes are covered and insure that all Board members and key employees have signed an acknowledgement form.
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Of all the volunteer boards I have sat on and/or chaired, the ethics and conduct policies I signed were for the duration of my term but I can see that redundancy here may be of benefit. Does any one know if the newer board members signed their conduct policies?
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Article V-Bylaw Definitions, Sec 14 Conflict of Interest. "A conflict of interest exists when any director, officer, member of a committee or employee of HPPOA, has a direct or indirect financial interest in any matter involving the Association. See Article VIII, Sec 11. An indirect financial interest shall include financial benefit to a relative of any director, officer, committee member or employee when so determined by a majority vote of the board or by policy established under Article VIII, Sec ll."
Board Member Code of Ethics: "Not use my service on this board for my own personal advantage or for the advantage of my friends, associates, or family".
HPPOA Corporate Policies under HPPOA Purchases and Contracts, III Standard of Conduct A.
No director, officer, or employee or agent of the Corporation shall participate in the selection, award or administration of a contract where, to his knowledge, he or his immediate family or partners have a financial interest, or w/whom he is negotiating or has any arrangement concerning prospective employment. No director, officer, employee or agent shall either solicit or accept gratuities, favors or anything of monetary value from contractors or potential contractors. B. Failure to comply w/the Standards of Conduct or the requirements of this Policy and Procedure may result in disciplinary action which may include termination." Perhaps it should say "shall result in...."
Also under our Corporate Policy: "Relationships that suggest a conflict of interest shall be avoided. No board member shall be employed by the Association for any reason. No family member of a director shall be employed for any reason." If the family member is a volunteer and not being compensated, then I believe there is no conflict of interest. If on the same committee, only one vote between the two of them..
I think the above covers a lot of ground and is enforceable. Yes we should adopt a conflict of interest policy annually per our bylaws, but not doing so doesn't negate what we have currently in our bylaws and policies.
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Mermaid,
As always, thanks for taking the time to post. Quite a bit of info here for us all .
To tell you honestly, I have never seen this "corporate policy" and have no idea of whether it is legally enforceable or not.. When was it adopted? Our original doc.s? or some time after? Is it referenced in our employee handbook or in information packets that new board members receive?
If I could roll back a bit, I speak only of our bylaws, which we know to be legally enforceable.
An " Annual Adoption" "COI" Policy is a requirement per our Bylaws .
( this is not to say that anything you have listed is negated)
Sample COI Policies are available on line. If you have the time, check out how they are formulated.
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