Posted on November 16, 2016 at 3:18 PM by Josh Yaworski
Bylaws are written rules that are intended to guide a board of director’s decisions and actions. At
the provincial level, if an organization wishes to become a registered non-profit, then they must
incorporate under a statute that best suits their situation. For example, in Alberta, the most
common piece of legislation that non-profits register under is the Societies Act.
By incorporating, the organization commits to a legal framework known as bylaws. A standard set of
bylaws must be submitted to the provincial government in order to be awarded a certificate of
incorporation. At a minimum, the bylaws will define its board of directors, membership, fiscal
management, and other principal areas of governance. These rules provide much needed internal
control. Without rules, the organization might encounter management issues.
The bylaws are a legal document, so the board of directors must abide by them and review them
regularly. If they are ignored then it could pose a risk to the organization. Any concerns regarding
the bylaws should be broached during a board meeting. Write the bylaws to be interpretable by
anyone.
A bylaw is a statement that won’t change very often, so it should be written with an angle of
permanency. Avoid including rules that could change regularly; rather, write those rules as policies
instead. Changing a bylaw requires lengthy protocol, so write all bylaws with intention and care.
The procedure for revising a bylaw is to have it drafted and approved by the voting members. Notify
the members twenty-one days in advance of the intention to change the bylaw. A special resolution
posed at an AGM, or a special general meeting called for that purpose, with at least 75% of
members present and voting can approve the change. After the motion is passed by the
membership, then the newly worded bylaw is signed by at least one director of the board and sent
to Corporate Registry. The revised bylaw does not take effect until it is approved and returned by
mail to your organization.
In order for an organization to run smoothly it makes sense to establish binding rules. The provincial
government recognized this need and stipulated that every non-profit organization who seeks legitimacy must provide a minimum set of bylaws and file annually to keep their incorporation
status.
Bylaws are helpful in preventing and responding to disagreement. An organization that chooses to
remain unincorporated can avoid ambiguity and adopt a set of bylaws anyway. It seems that rules
help us to know what to do and what not to do. This valuable document will serve to guide the board of directors and streamline the way it approaches certain critical aspects of its governance. It
ensures that everyone is on the same page. It helps to avoid chaos.
Drafting and Revising Bylaws
