Difference between revisions of "10 Changes in the New Societies Act You Should Know About"

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The new Act provides greater flexibility in conducting members’ meetings. Participating by telephone or other communications media is recognized as the norm. Unless a society’s bylaws provide otherwise, members can participate in meetings by phone or using other technology so long as all the people participating are able to communicate with each other.

An annual general meeting can now be held entirely in writing. All voting members must consent to a written resolution covering the matters that must be dealt with at the AGM, including the presentation of the financial statements and any auditor’s report.

The new ''Societies Act'' lowers the voting threshold for approving a special resolution. A special resolution approved by a society’s members is required to make fundamental changes to a society, including changing its name or bylaws.

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Members of a society have always been able to requisition a member’s meeting for a specific purpose, provided that at least 10% of voting members sign the requisition. The new Act introduces a right for members to add specific issues to the agenda of an annual general meeting. A '''member proposal''' must be added to the agenda if the proposal is signed by at least 5% of the society’s voting members. The proposal must be received by the society at least 7 days before notice of the AGM is sent.

A society’s board of directors have the discretion to reject the proposal if it is substantially similar to an issue that has already been voted on at a member’s meeting in the previous two years.

Under the new Act, members are able to apply to court for a remedy if the society’s activities are oppressive or unfairly prejudicial to one or more members. In applying for such an '''oppression remedy''', a member will need to show they had a reasonable expectation to be treated in a certain way. They will also need to show that the society’s conduct was burdensome, harsh and wrongful, or had an unjust and inequitable effect on them.

Also under the new Act, members may bring a '''derivative action'''. In such an action, a member can enforce rights of the society when the directors refuse to act.

The new Act introduces a new category of '''senior managers'''. These are individuals appointed by the board of directors to manage the activities and internal affairs of a society or a principal unit of a society.

The Act imposes duties on all senior managers, including the duty to act “honestly and in good faith with a view to the best interests of the society” and the duty to disclose a conflict of interest (see the next item). The Act also limits the liability of senior managers, inviting a court to relieve the manager from liability for any negligence or breach if the manager “acted honestly and reasonably and ought fairly to be excused”.

Under the new Act, there are expanded procedures for how conflicts of interest are managed. A conflict of interest is a situation in which someone has a duty to act in the best interests of an organization, yet they may have personal interests that conflict with that duty. For example, a board director may work at a law firm that the society is considering retaining. Or an executive director may be related to a web designer that the society is contemplating hiring.

As well, societies must now keep records of any disclosures by directors or senior managers of a conflict of interest.

Changes that take effect for pre-existing societies in November 2018 affect the qualifications to be a director of a non-profit in BC. Under the new Act, a director must be at least 18 years old, unless the bylaws expressly allow directors who are age 16 or 17. If the bylaws allow directors who are age 16 or 17, the majority of the society’s directors must be age 18 or over.

'''These provisions don’t come into effect for pre-existing societies until November 28, 2018.  

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Also coming into effect in 2018 for pre-existing societies is a provision that a society must not remunerate a director for being a director unless the bylaws expressly permit. Remuneration is money or other compensation paid for work or services performed – in this case, the work of being a director.