Update: Changes to the Co-operative Corportations Act

In December 2009, Bill 218 – formally called the Ontario Tax Plan for More Jobs and Growth Act and informally referred to as the HST Bill – was tabled and passed in the Ontario Legislature. In addition to introducing the HST, the bill made a number of other changes to other pieces of legislation, including the Co-operative Corporations Act. The changes that were made provide more options to co-ops in how they run their meetings, and options in the composition of their boards of directors and the election process.

The changes to the Act include:

1. Co-ops (with the exception of non-profit housing co-ops) now have the option of holding members’ meetings using electronic means – such as teleconferencing, web conferencing or email. Co-ops can also accept votes by mail if they choose.

2. Co-ops (again with the exception of non-profit housing co-ops) can now have up to 1/5 of the board of directors be non-members. Previous to this change, the boards of co-operatives could only be made up of co-op members.

3. Co-ops can now provide for directors to be acclaimed to seats on the board, if there is a situation where there are the same number of candidates (or less) as there are open seats on the board. This keeps the co-op from having to run through a full election process in a case like this.

4. The board president in a co-op can designate a non-member to act as the chair of a members’ meeting. Previous to the change, co-ops could only appoint an alternate chair from within the membership and only if both the President and Vice-President were absent from the meeting.

5. The board of a co-op can now specify a meeting place for members’ meetings to be anywhere in Ontario when they call the meeting, unless the bylaws of the co-op specifically mandate that members’ meetings are to be held in a certain location.

6. The requirement for multi-stakeholder co-ops to have one director present from each stakeholder group at board meetings has been removed.

Two things to note:

• Co-ops don’t have to make use of these new provisions in the Act if they don’t wish to. It is entirely up to the board and membership of the co-op to decide if they wish to use any or all of the new provisions.

• In order to make use of some of the changes (the first three mentioned above), a co-op has to change its bylaws to specifically allow certain actions. This means that a special provision is needed, which is where the board approves changes to the bylaws, and then they go to the membership for approval at a members’ meeting. In order for bylaw changes to become effective, 2/3 of those members present at a meeting must vote to approve the changes.

The Ontario Co-operative Association (On Co-op) is in the process of developing a series of guides that explain the more significant changes in more detail and these will be available for download from the website in the next several weeks. Contact Jen Heneberry, Co-op Development Manager, for more details about these changes or to obtain copies of these guides. (519.763.8271 x23, jheneberry@ontario.coop).