Mountain Equipment Co-op Proposes Screening Process for Board Candidates

Blog posts reflect the views of their authors.

It's time once again for Mountain Equipment Co-op's 3.3 million member-owners to vote for their board members and vote on special resolutions. This year's special resolution contains a major change to the mechanism for electing board members. Currently, to be a candidate for the board, one must have been a member for at least two years, have purchased something at the co-op in the last year, and be endorsed by five other members.

Here is the text of the proposed change to the selection of board candidates (to read it online, visit this page and click on "special resolution"):

11. Appointment and duties of the nominations committee

11.01 The directors must appoint a nominations committee. The nominations committee will:

    a. under guidance from the Board, determine and communicate to members in advance of each annual election the desired qualifications, experience and other attributes needed for directors of the Co-operative;
    b. identify, recruit and nominate members having the qualifications, experience and other attributes necessary to stand for election;
    c. conduct such other matters as are set out in this or other sections of the Rules or as may be assigned by the Board.

11.02 The nominations committee will receive and review all candidate nominations to ensure each complies with the Act and the Rules. Any non-compliant nomination will be rejected and returned to the nominee with reasons for rejection.

11.03 The nominations committee will manage the process for the election of directors and ensure that each election is conducted in accordance with the Act and the Rules, and as such, will be responsible for determining the nominees for director who will be included in, and named in the ballot for, each election of directors. In doing so, the nominations committee will select those nominees who meet the desired qualifications, experience and other attributes for directors, and decline any nominations for nominees who do not meet the desired qualifications, experience and other attributes for directors, as per its authority set out in the Rules and Board policy.

11.04 Upon determination of the nominees to be included in each election, the nominations committee will provide a list of such nominees to the election auditor.

11.05 The nominations committee will appoint a person to attend and witness any drawing of lots required in connection with an election of directors.

Under the proposed changes (emphasis added above), the board-appointed nomination committee gets to decide which of the people nominated for the board actually become candidates. They do this according to criteria which the board itself sets (see 11.01 a).

This effectively creates a major barrier to any change in direction desired by the co-op's members, and removes the board as a mechanism for carrying out such a change. Unfortunately, the board is one of the only mechanisms people have to change the overall direction of the co-op. It means that if any future board runs amok, it will be very difficult to displace them, because they can simply screen out any members which challenge their power.

Here are the current bylaws with regard to nominating board members (strikethroughs indicate the parts removed in the proposed changes contained in the resolution):

11. Appointment and duties of the nominations committee

11.01 The directors must appoint a nominations committee.

11.02 The nominations committee must:

receive the nominations of candidates,
ensure that the number of candidates at least equals the expected number of vacant positions as determined by Rule 10.06,
inform the election auditor of the names of all candidates immediately after the close of nominations, and
designate a representative to attend any drawing of lots.

11.03 The nominations committee may nominate candidates.

In their description, and in the Q&A about the special resolution on the MEC election site, the new power of the board seems to be significantly downplayed. The idea of the board playing a more "proactive" role in nominating candidates overshadows the fact that they can simply reject the ones which do not match their criteria. In fact, this is downplayed, as we see in the following response at the end of the Q&A:

The proposed Rule change, however, would empower the Board to go further – to recruit potential candidates, assess them against the Board’s predetermined leadership needs, and ultimately nominate those candidates who the Board believes are qualified to lead MEC. In turn, as happens today, members will decide which candidates are the most qualified to serve as MEC directors. In effect, the Board will be better able to uphold its fiduciary responsibility of stewarding the Co-op on members’ behalf.

The language used here muddles the fact that the members would be choosing from among those candidates who the board deems to be qualified. The board already has the ability to nominate candidates it thinks are qualified; that is not the change being made. Nowhere in the Q&A, however, is the substance of the change -- that the board's committee gets to pick which candidates can run -- justified. Since it represents a significant limitation on members democratic freedoms, one would expect there to be a substantial explanation justifying the change. But the opposite is the case: we're left with the impression that removing the members' right to choose their own board is just a minor footnote in a broadly progressive update to the bylaws.

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