Will the Real Directors Please Stand Up

December 22, 2014 Posted by Jessica Shofler in Board, Director Duties, News, Nonprofits

ex officio directorsThere is a lot of confusion among nonprofits with regard to ex officio directors. Who are they and how are they different from other directors?

The term ex officio comes from Latin and means “from the office.” Thus, an ex officio director is a member of the board because he or she holds a specific office or position. For example, if an organization’s bylaws state that the Executive Director is an ex officio member of the board of directors, then the person who holds that office is automatically a director. But does an ex officio director have all the rights of any other director, including the right to vote?

In 2009, the California legislature attempted to clarify the law. That year, an amendment to the law held that ex officio directors were required to be treated as all other directors, including having the right to vote. This was true regardless of whether the articles or bylaws of an organization specifically stated that ex officio directors were non-voting. But rather than providing clarification, the amendment left many nonprofits even more confused.

In 2014, the legislature took another stab at clarifying the law. A new amendment (effective January 1, 2015) provides that a person who is a member of the board by reason of occupying a specific position has all the rights and duties of every other member of the board, including the right to vote, so long as the articles or bylaws do not limit that person’s voting rights. Stated another way, if a person is a member of the board based on his or her position and the articles or bylaws limit that person’s right to vote, then that person is not a director regardless of his or her title.

This means that only persons who have voting rights on a board are statutory directors regardless of title. A nonvoting ex officio “director” could be invited to attend board meetings, but would not have the right to vote at such meetings and would not have any other rights or obligations of directors.

Still confused? We’re here to help. Please contact us with any questions your board has about ex officio directors or corporate governance in general.

NOTE: The information contained herein is not intended to be legal advice and the reader should know that no Attorney-Client relationship or privilege is formed by the posting or reading of this article which is also not intended to solicit business.

Casey Summar, Partner, The Law Firm for Non-Profits, 4705 Laurel Canyon Blvd, #306, Studio City, CA 91607

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