Alternatives Exist to In-Person Voting at CU Meetings
The June 18 edition contained an article–“St. Helens Dismissed NCUA”–regarding the disagreement that occurred between the president/CEO of St. Helens Community Federal Credit Union and the NCUA regarding the proper method of conducting a vote at a special meeting for the recall of directors.
Upon review, it seems both sides got it wrong.
On the one hand, Brooke Van Vleet's attempt to utilize absentee ballots for a vote at a special meeting to recall directors, without providing those directors some means to be heard by all of those voting, would not be appropriate.
However, the NCUA's position that members would be required to physically attend the meeting in order to cast a vote is not exactly in keeping with the times, available technology or best practices typically followed in regard to corporate governance.
While I would agree with the NCUA's position that members of the board of directors who are subject to being removed do have a right to be heard, there are options for accomplishing that objective that do not require physical presence.
Credit unions could take advantage of several methods of communication to properly provide the directors with the ability to be heard in any particular instance. Individuals could provide a statement which could only be countered by similar written statements or they could be provided with the ability to participate via a teleconference or webcast so that individuals on both sides of an issue may be properly heard.
To require a physical presence is somewhat archaic in light of other options, including the use of various technologies that are available. In fact, many credit unions do not require such attendance for the purposes of voting at annual meetings where there are contested elections. The use of mail ballots for such purposes is not only permitted under NCUA regulations, it is becoming the norm as opposed to the exception with many credit unions.
The NCUA's insistence that a physical meeting need be held and that anyone who wishes to vote be required to attend the meeting in order to cast a ballot is not only somewhat antiquated, but could serve to deprive members of a right to vote on an issue which might be important to their credit union.
I wonder whether or not the majority of the members of a very large credit union such as Navy Federal would ever be able to participate in a special meeting of any sort if the NCUA's interpretation of the requirements is followed.
I think the better and more fair approach to this issue is to make sure that all parties have an opportunity to be heard in the same format, whether writing, teleconference, webcast or in person. Once that ability to be heard is addressed, members should be able to cast their vote by a method that is convenient to them.
This method is not only utilized by credit unions in electing credit union directors on an annual basis, it is utilized frequently throughout the corporate world as a means of allowing shareholders to participate in the governance of the institutions in which they have invested.