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Election Process & Ethics

The subject of "ethics" came up a number of times during our past election, and the need for "ethics training" was central to the campaign of newly elected Director Jodi Zagory. Our new Board of Directors took this seriously, and "unanimously passed a motion requiring new Directors to undergo ethics training within 3 months of taking up a seat on the Board." The $3,000 training was recently completed. This focus on ethics brings to mind our last election season, during which many procedural, fiduciary — and ethical — concerns were swept under the rug. Now, with a new appreciation for ethics, perhaps it is time to revisit the issue.

In spite of several progressive aspects of last year's election, the process was badly flawed. The sending of proxy ballots to every “shareholder” (rather than one per apartment) was the least of the errors. Aside from this:

  • The list of Shareholders to whom proxy ballots were sent was at least two years out of date.
  • The Election Committee was promptly notified that the list was out of date, and the notification was ignored.
  • Part of the American Arbitration Association’s job was to send receipts to people who voted by proxy; the receipts were not sent, and our Election Committee did not take the initiative to discover this.
  • Once it was pointed out that the American Arbitration Association hadn’t sent receipts, our Election Committee issued a memo falsely claiming that many receipts had been sent.
  • Despite being aware of all these issues, the Election Committee's memo aimed to put a happy face on the election process. They made no effort to collect the evidence that was available, and there is no indication that they considered the implications of these striking failings.

These points entail a number of procedural, fiduciary and ethical breaches that were never properly acknowledged nor addressed.

Voting is the single means through which most Shareholders participate in our governance. Neglecting to follow-up on a flawed election is not only an ethical breach; it casts doubt on the results of the election and, by extention, the mandate and actions of any Directors so-elected. Accordingly, ensuring that our election process properly reflects the intentions of our Shareholders underlies the fiduciary responsibility of our Directors.

Going forward, our Directors must ensure that our election process — from initial planning through final statistical reporting — is robust and accurate, and that any problems are addressed in a prompt and transparent manner.