Mr. Speaker, I am pleased to have the opportunity to speak to the not for profit corporations bill.
I have been listening intently to many of the issues, suggestions and observations that have been raised by members opposite and in particular, the last member's comments. I hope that what I am going to say will address some of those concerns.
We should reflect for a moment. When we think of not for profit corporations, we generally think of the good works they do, of the benefits all Canadians derive from the efforts of thousands of volunteers in the voluntary sector. All of us have had huge experience with members of these organizations. We realize that the quality of life in our communities depends on this voluntary capacity without which we could not do our jobs. We think of the social bonds that are formed among members of non-profit organizations. We also think of them when they join together and participate for the higher benefit of the public good.
In these cases it is important to recognize that not for profit corporations are only as effective as their members make them, and that membership brings with it responsibilities and equally important, it brings rights. In a very complex society we have to keep in mind the accountability that goes with responsibility. We also have to keep in mind the protection that members have when they become part of a voluntary, not for profit organization.
This legislation will go a long way toward protecting the rights of members. In doing so, it will ensure that corporations are more open, more transparent and accountable to the men and women who are the heart and soul of any non-profit organization that is working within our communities. I would suggest very humbly that the bill will accomplish this in several ways.
First, members will have access to corporate records to facilitate active monitoring of the board's performance. In a modern non-profit corporation, or any corporation for that matter, it is imperative that the members have the ability to keep themselves fully apprised of the ongoing dealings and workings of the organization and that they apprise themselves of its status and take action when they perceive that problems are starting to occur.
The bill provides that the non-profit corporation must maintain and make available to its members a lengthy list of important corporate records. These include the corporation's articles, bylaws, meetings of members or committee of members, and resolutions of the members or a committee of members. It is not an onerous undertaking by any stretch of the imagination, that the accountability of individuals and individuals together makes the corporation, in this case the voluntary corporation, responsible and accountable.
Second, the bill provides members with the right to access to a corporation's membership list. It is hard to believe in this day and age but this is an important facet of closing the accountability loop. This would give members the opportunity to act in concert on matters of concern to the corporation's members.
An individual may only retrieve the membership list once per year and must sign a statutory declaration affirming that the list would only be used for the purposes set out in the bill. The general public would not have a right of access to those membership lists. The confidentiality of members would be respected to that extent, but the members themselves would have access to the lists, as it should be.
Third, the bill enhances members' rights by permitting any member entitled to vote at a meeting of the membership to submit a proposal for consideration at that meeting and to speak on the matter addressed in the proposal, sort of the concept of natural law. If a matter is raised, all of the organization's members have a right to be informed of that before and after it is raised. If such a proposal is submitted in the required period, the corporation is required, subject to any restrictions in the bill, to include it with any material being distributed by the corporation in advance of the meeting.
The ready access to membership lists to which I have already spoken should promote better communication and contact among the membership.
The fourth way the bill enhances the rights of members is by protecting members who feel that their rights are being infringed or that actions are being taken that are not in the best interests of the corporation. Members will be able to utilize oppression remedies, something which another member talked about, to launch derivative actions or to seek injunctive relief. These remedies are standard provisions in modern corporate statutes.
The oppression remedy allows a member to apply to a court for an order in respect of conduct that the member feels is against his or her interests. The powers of the court are very broad. The court may order a restraining of the conduct in question and appoint a receiver or a receiver manager. It may amend the articles. It may review the bylaws. It may appoint or even replace directors if just cause is raised and if the nature of that which is raised by the member is in keeping with the degree of seriousness that we have observed from time to time in organizations.
In a derivative action, if the business of the corporation or part of it is being conducted in a manner that a member feels is not in the best interests of the corporation, he or she may apply in the name of the corporation to a court to remedy that situation. The applicant must first notify the directors of the corporation of the intent to make that application and must convince the court that he or she is acting in good faith and that the action would be in the best interests of the corporation. If a member finds that the corporation, its directors, officers and other parties do not comply with the act, they may seek from the court a restraining or compliance order to ensure that the act is obeyed.
There is one exception to this. The oppression remedy or derivative action and injunctive relief would not be available to a member if the action in question was, in the view of the court, based upon a tenet of faith held by the members of the corporation. This gets into the religious aspect. It does not mean that a member of a religious organization would face restrictions on his or her ability to use the courts in order to overturn an action taken by a corporation made on the basis of its religious doctrines or tenets of faith. However, this is only fair. The bill should not override the rights of religious organizations to decide for themselves how their doctrine should be applied. It is an appropriate limitation on members' rights.
Fifth, in order to ensure that as many members as possible are able to participate in the meetings of the members, the bill provides that, as long as it is permitted by the bylaws of the corporation, meetings may be held wholly or partially by electronic means. This includes any form of telephonic, electronic, or other means of communication, as long as it ensures that all members participating in the meeting can properly communicate with each other.
The bill also provides that, subject to the bylaws of the corporation, the votes may be held by electronic means. The criteria for such votes are the same as for electronic participation in meetings of the membership.
Finally, members are given the right to make, amend or repeal bylaws for the corporation by majority vote. The only restriction concerns bylaws that would result in what was deemed to be fundamental changes to the corporation, such as changing the name of the corporation, changing its mission or its sense of purpose, instituting a new class of membership, or changing criteria for membership. In these instances, the bylaw in question may be passed but it must be approved by two-thirds of the appropriate members as opposed to simple majority. This is in contrast with the current practice in which corporations must submit any new or amended bylaws for ministerial approval.
By enhancing the rights of members of not for profit corporations, I believe that this bill is good for the non-profit corporations themselves and for the voluntary sector as a whole. While there has been reasonable attention given to some of the shortcomings in the bill, the ongoing experience of the bill in fact will make it a very important instrument that will keep non-profit organizations viable and accountable, and that will keep the membership totally informed in terms of what their rights are as members of those groups. The non-profit corporate sector will continue to enhance the kind of quality of life that we want for all our communities.