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BOARD OF DIRECTORS’ CODE OF CONDUCT
1. Directors of a Housing Corporation have a fiduciary duty to act in the best interests of all shareholders of the corporation. They have the entire charge of the property, interests, business and transactions of the corporation.
2. At meetings, Directors should cooperate as a group in reaching a decision in the best interest of all shareholders. Each Director shall be encouraged to express their personal opinion, but all Directors shall respect the ultimate decision of the Board.
3. Directors should make every effort to attend Board meetings. Absence from three (3) consecutive meetings of the Board without being excused, shall be deemed a notice of resignation from the Board.
4. Directors must not place their personal interests or the interests of a small group of shareholders above the interests of all shareholders of the corporation.
5. Directors acknowledge that the deliberations of the Board often contain personal information or financial information which is confidential. Directors should not discuss the deliberations of the Board or individual shareholders’ personal or financial information with anyone other than Board members, unless authorized by a vote of the Board.
6. Directors set an example by their behavior for other shareholders of the corporation. They should at all times act civilly towards one another, towards the corporation’s employees and towards its shareholders. A Director who shall persistently disrupt or engage in objectionable conduct at a meeting of the Board shall be subject to immediate removal from such meeting by the affirmative vote of two-thirds (2/3) of the remaining board members in attendance.
7. Directors are charged with the responsibility of conducting the business affairs of the corporation. They may not ignore this responsibility or delegate it to shareholders who are not directors.
8. Directors must keep reasonably informed about the business affairs of the corporation. They may rely upon the advice of management, experts and professionals when acting on behalf of the corporation.
9. Directors are required to act in accordance with the law, may not engage in wrongful conduct, and may not overstep their authority. Directors should be mindful that that they set an example by their behavior for other shareholders of the corporation, and are perceived by shareholders to be acting on behalf of the corporation. Accordingly, Directors may not take any action on behalf of the corporation without the express authority from the Board to do so; and when acting in their personal capacity, Directors must make it clear that they are not acting on behalf of the corporation. Directors are required to act with the degree of care that a reasonably prudent person would exercise in the same circumstances. A Director who engages in any illegal or objectionable conduct may expose the Corporation to liability and may be personally responsible for his/her actions. The Corporation will not indemnify the Director for any such behavior.
10. Directors may not offer, solicit or receive, directly or indirectly any commission, bonus, gratuity, fee or any other payment in connection with their position on the Board. Violation of this paragraph shall be deemed a notice of resignation from the Board.
11. Directors shall cooperate fully and faithfully with any investigation, audit or inquiry conducted by any governmental agency or authority that is empowered directly or by designation to compel the attendance of witnesses and to examine witnesses under oath.
12. Directors elect the officers of the corporation who are responsible for carrying out the duties of their office as set forth in the by-laws.
13. Directors may serve on standing committees of the corporation. Committees are created by the Board. A committee does not take corporate action; its purpose is to report to the Board, which then may act upon the committee’s recommendations. Directors are to assist committees to carry out this duty and such other functions as may be delegated to the committee by the Board.
Received on  by Date
Signature of Director
Steven - You're correct about the ways to remove a member of the Board, but there is one other way - if the By Laws are amended (passed by a 2/3 vote of the shareholders) to allow removal by a majority vote of the Board - **but only with legitimate good cause**, which may include, but is not limited to...
- Breaching confidentiality
- Not acting in the best interest of all shareholders
- Making prejudiced/racist remarks towards s/h (including Board members)
- Not acting in a sound fiduciary manner
- Falsely accusing other Board members, management, accountant, of
financial impropriety
What is considered *not* good cause? A personal dislike of another Board member or disagreeing with another Board member's opinions and viewpoints.
This amendment to the By Laws was passed in our co-op after some outrageous behavior by a Board member.
We felt it was important to have this option because if a Board member goes rogue, the co-op's ability to make sound and confidential decisions on behalf of the s/h will be compromised. If it takes weeks or months to have that special meeting of the s/h to discuss/decide the matter, the co-op might be irreparably harmed.
I just read through the entire Code of Conduct, and the Subject of your post is very misleading. The CoC only mentions removing a board member from a board meeting, and not from the Board of Directors.
I suggest in the future you limit your posts to just the relevant parts of a document and not reproduce the entire document, and that you include a narrative at the beginning of your post describing what you are hoping other posters in this forum can help you with.
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What is this and where does it come from? I do not recognize it as any of the official co-op governing documents. What vote or other means of adoption gives it any legal standing? Has anyone checked to see if any part of it contradicts the Proprietary Lease or Bylaws?
Has an attorney reviewed the contents of Code of Conduct and opined they are legal and binding on board members?
This appears to be an attempt to supplement or circumvent the PL and Bylaws, which can cause huge problems if a decision or action taken on their behalf is legally challenged.
If not already done so, I *strongly* suggest you ask your board attorney if they have any value whatsoever.
As far as I am aware, since board members are directly elected by the shareholders, only a majority or super-majority of shareholders can remove a director, and only at a special meeting requested by a defined number of shareholders. If an attempt is made to remove a director that is not 100% compliant with the PL and Bylaws, the director can sue, and you really don't want to deal with that.
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