Electronic Voting: A New Type of Corporate Governance
Jim Glatthaar of Bleakley Platt & Schmidt presided over what may be the first meeting of its kind in New York: an annual shareholder’s meeting for a residential cooperative where the Board of Directors was elected by on-line voting. BPS has represented the Surrey Strathmore, a White Plains cooperative corporation, for over 13 years. Surrey Strathmore has not elected directors since 2006 since a quorum of shareholders, more than 50%, has not been present.
When struggling with ways to increase shareholder participation, one of the directors, Allison Keilman, devised the idea of on-line voting at the annual meeting. She presented her idea to Jim Glatthaar, who researched the relevant statutes and determined that electronic voting was consistent with the New York State Business Corporation law.
Together, Allison and Jim created a process which gave all candidates for the Board of Directors time to announce their candidacy, upload biographies and photos of themselves on line, and allow voting starting one week prior to the annual meeting. In addition, the on-line voting period was extended to 12:00 noon the day after the annual meeting. This process allowed any shareholder who attended the meeting to speak with the candidates and cast their ballots after meeting the various candidates.
On-line voting was a tremendous success. Seventy (70%) percent of the shareholders participated, either live or on-line, meaning that the Surrey Strathmore achieved a quorum and elected directors for the first time in years. Moreover, those shareholders who wish to participate, but were busy or turned off by the annoying personalities who sometimes dominate residential cooperative annual meetings, could read the candidate biographies, speak with the candidates and cast their votes from their desktop or laptop computer in their home or office. Finally, the meeting was efficient and was concluded within 25 minutes.
Habitat Magazine, a magazine geared toward cooperatives and condominiums, attended the meeting and will be reporting on electronic voting in a future issue.