How to manage a board of directors for a non-profit

Societies are managed by a board of directors. The Societies Act and your bylaws include rules about how to run your board.

A board member is elected, designated or appointed to be the director of a society. We refer to “board members” in this document, but the Societies Act calls board members “directors.”

There are many places in the Act where it asks you to refer to your bylaws. If we say, “your bylaws may” or “subject to the bylaws” that means you should check your bylaws to see what the rules are. If we say, “you must,” that means the Act requires you to do something.

Many societies have adopted our sample bylaw sets. We've added some information about these on this page.

You need at least 3 members on your board. At least 1 of those board members must be a Yukon resident. 

Your bylaws might specify a minimum and maximum, or a fixed number of board members. We usually recommend an odd number of board members so that there's a clear majority when you vote.

If you're a member-funded society, you only need 1 board member.

If you're starting a new society, you need to list the first directors on the incorporation form. This could be the people who are incorporating the society and any additional people appointed to the board.

These people serve as the board of directors until the end of the 1st annual general meeting (AGM). 

See section 45 of the Societies Act for more information.

Typically, board members are elected every year at the AGM. However, your bylaws may have different rules. Your society can hold an election for board members every:

  • year;
  • 2 years;
  • 3 years; or
  • 4 years.

A board member cannot serve for more than 4 years without being elected. 

Board members can be re-elected for new terms indefinitely. However, our best-practices bylaws put a limit on this by saying that board members cannot serve for more than 8 years. The Act does not require this. 

Your bylaws also might stagger the board members’ terms or allow different terms for different positions on the board. Check your bylaws to see how often you need to hold elections for board members.

How to elect people to a board

Voting members can use a simple majority vote to elect someone to the board of directors – subsection 45(3) of the Societies Act.  

To be on the board, a board member needs to consent to being on the board. That means they must:

  • consent in writing to being a board member; or
  • not refuse to be a director at the meeting where the election takes place.

If the board member consents in writing, you need to keep a copy of that as a record.

What happens to the board if we miss our AGM?

If an AGM does not happen, the board continues to serve until the next AGM and the election takes place.

What happens if you do not elect enough board members?

It depends on how many board members you elected and what your bylaws say. If you elected a quorum, those board members can proceed as the board of directors. 

What is quorum

  • For example, if your minimum number is 7 and you elect 4 people, you can proceed. 
  • If you do not have a minimum number defined in your bylaws, your minimum is 3 board members, so quorum is 2.

If you do not have quorum:

  • the society must call a general meeting as soon as possible to fill the vacancies; or
  • a member can call a general meeting in this situation if the board does not, or if there are no board members elected.

You can fill a vacancy if:

  • you’ve elected a quorum but still have vacant seats on the board; or
  • someone leaves the board in the middle of their term.

To fill a vacancy, the board can:

  • appoint people to fill the remaining vacancies;
  • call a general meeting to elect people to fill the vacancies (if your bylaws require it or if the board prefers); or
  • leave the seats empty until the next general meeting.

A board member filling a vacancy has to be re-elected to their position at the next AGM.

See section 54 of the Societies Act for more information.

Adding more people to your board

Check your bylaws to see if you can add more people to your board without voting them in at a general meeting. If they do:

  • you cannot add more than 1/3 of the number of board members elected at the previous general meeting; and
  • the people you’ve added to the board can serve until the next AGM when they need to be elected to their position.

Our basic bylaws have this as an option, but our best-practices bylaws do not allow it. Read in detail about this in section 45(8) of the Societies Act.

If your bylaws do not allow board members to add more people to the board without a vote:

  • you need to call a general meeting to elect more people to the board;
  • you might want to amend your bylaws to change your maximum number of board members; or
  • if you call a general meeting to pass a special resolution to amend your bylaws, you can also elect new board members at the same meeting. 

See section 54(8) of the Societies Act for more information. 

According to the Societies Act, you cannot serve on a board if:

  • you're under the age of 19;
  • you represent a corporation or another entity rather than a person;
  • a court has found you to be legally incompetent;
  • you currently have a bankrupt status; or
  • you’ve been convicted of fraud, unless:
    • the court orders otherwise; or
    • 5 years have elapsed since you last served for fraud.

Your bylaws might also tell you if:

  • there are any other rules about who is qualified to be on the board; and
  • a director also needs to be a member of the society (the default in the Act is that a director does not have to be a member). 

See section 47 of the Societies Act for more information. 

In the Societies Act, board members with titles are called “officers”. The board can appoint 1 or more officer positions on the board, such as:

  • president;
  • vice-president;
  • co-chair; and
  • treasurer.

Members do not need to elect officers at a general meeting. The board can decide who is an officer.

Your bylaws might specify what officer positions are available and how to fill them. Our best-practices bylaws have details on this but our basic bylaws do not.

A society can pay its board members under certain circumstances. See section 49 of the Societies Act for more information. 

Your bylaws allow you to pay board members

If your bylaws allow you to, you can pay board members for their work as board members. For example, you could pay an honoraria or a wage for their time spent working on the board.

Reimburse board members for expenses

You can reimburse your board members for reasonable expenses they incurred during their work as board members. Your bylaws could restrict or prohibit reimbursement.

Contract work

If your bylaws allow you to, you can pay your board members to do contract work or be employed by the society. You cannot pay the majority of board members for contract work or employment.

Our best-practices bylaws: paying board members

Our best-practices bylaws allow you to pay board members for reimbursement or for a contract or employment, but not for being a board member. Our basic bylaws allow you to choose whether you want to pay a board member for their work on the board or not. 

What about your financial statements?

If you pay your board members, your financial statements must contain:

  • a list of directors who were paid, including their position and title;
  • the amount they were paid; and
  • what they were being paid for – for example, an honoraria, a reimbursement, or a contract.

The financial statements do not need to specify the directors by name.

See sections 44, 49, and 38, and the Societies Act and section 10 of the Societies Regulation for more information. 

What is a conflict of interest?

A conflict of interest is when a:

  • board member could stand to gain or have a significant personal stake in 1 of the society’s contracts or transactions; or
  • board member’s personal interests might clash with their responsibilities as a board member.

How to deal with a conflict of interest

If a board member has a conflict of interest, they must:

  • quickly disclose the conflict of interest and lay out the nature of the conflict;
  • not vote (abstain from voting) on a matter related to the conflict of interest;
  • leave any meeting where their conflict of interest is discussed; and
  • refrain from trying to influence other board members on their votes.

If there's a conflict, the conflict can be approved if the:

  • board member properly disclosed the conflict of interest according to section 60 of the Societies Act; and
  • directors approved or the members approved by special resolution. 

The society must keep a written record of the conflict of interest. This could be:

  • the minutes of the meeting where the conflict was disclosed;
  • a consent resolution of the board; or
  • a written notice of the conflict from the person with the conflict addressed to the rest of the board. 

What is not a conflict of interest?

You do not need to declare a conflict of interest if the:

  • society paid a board member for their work on the board or for reimbursement for reasonable expenses (subject to the bylaws);
  • board covers a board member for loss of money related to society business; or
  • member purchased insurance for themselves or the society.

If a conflict of interest is not disclosed

The board member has to give the society any profit they made because of the conflict.