Parliamentary procedure in the corporate world
Encyclopedia
Parliamentary procedure in the corporate world may follow traditional parliamentary authorities
such as Robert's Rules of Order
or simpler rules of order considered by some commentators to be more appropriate in the corporate setting.
to be used in corporate meetings. For instance, the Davis-Sterling Act, a California statute, provides that certain business meetings "shall be conducted in accordance with a recognized system of parliamentary procedure or any parliamentary procedures the association may adopt."
Donald A. Tortorice's The Modern Rules of Order is a parliamentary manual for use in the corporate world. His book includes statements such as "Procedural measures are no substitute for leadership" and "A principal element of these rules is to place the requisite authority in the hands of the Chair to lead the meeting through its business, using these rules as a guide to what should be done and not as an unyielding mandate as to what must be done." However, it is noted that the motion to appeal
from the decision of the chair or to declare the chair vacant
and elect a new chair remains a procedural safeguard to abuses by the chair.
With regard to stockholders' meetings, one legal commentator has noted:
The case of People v. Albany & Susquehanna R.R. established that a corporate election will be set aside if a faction of shareholders conducted the meeting in a manner that bore the appearance of "trick, secrecy or fraud." Other cases have further limited the power of the chair, noting, for instance, that the chair cannot adjourn a meeting, even in the absence of a quorum, without a vote of the assembly. The principles of majority rule
must be followed and cannot be abrogated by the chair.
Parliamentary authority
A parliamentary authority is a manual on parliamentary law, containing rules of order for the transaction of business in deliberative assemblies...
such as Robert's Rules of Order
Robert's Rules of Order
Robert's Rules of Order is the short title of a book containing rules of order intended to be adopted as a parliamentary authority for use by a deliberative assembly written by Brig. Gen...
or simpler rules of order considered by some commentators to be more appropriate in the corporate setting.
In general
State statutes typically do not prescribe a particular parliamentary authorityParliamentary authority
A parliamentary authority is a manual on parliamentary law, containing rules of order for the transaction of business in deliberative assemblies...
to be used in corporate meetings. For instance, the Davis-Sterling Act, a California statute, provides that certain business meetings "shall be conducted in accordance with a recognized system of parliamentary procedure or any parliamentary procedures the association may adopt."
Donald A. Tortorice's The Modern Rules of Order is a parliamentary manual for use in the corporate world. His book includes statements such as "Procedural measures are no substitute for leadership" and "A principal element of these rules is to place the requisite authority in the hands of the Chair to lead the meeting through its business, using these rules as a guide to what should be done and not as an unyielding mandate as to what must be done." However, it is noted that the motion to appeal
Appeal (motion)
In parliamentary procedure, an appeal from the decision of the chair is used to challenge a ruling of the chair.-Explanation and Use:George Demeter notes that it "protects the assembly against the arbitrary control of the meeting by its presiding officer." The most common occasions for the motion...
from the decision of the chair or to declare the chair vacant
Declare the chair vacant
The motion to declare the chair vacant is a Disciplinary procedures used as a remedy to misconduct or dereliction of duty by the chair of a deliberative assembly, when the rules allow it...
and elect a new chair remains a procedural safeguard to abuses by the chair.
Shareholders meetings
The ABA Handbook recommends the abolition of parliamentary procedure at shareholder meetings and the strong concentration of authority in the meeting chair, subject to a fairness standard of conduct, concerning virtually all matters of order, recognition, voting procedures, and adjournment.With regard to stockholders' meetings, one legal commentator has noted:
The case of People v. Albany & Susquehanna R.R. established that a corporate election will be set aside if a faction of shareholders conducted the meeting in a manner that bore the appearance of "trick, secrecy or fraud." Other cases have further limited the power of the chair, noting, for instance, that the chair cannot adjourn a meeting, even in the absence of a quorum, without a vote of the assembly. The principles of majority rule
Majority rule
Majority rule is a decision rule that selects alternatives which have a majority, that is, more than half the votes. It is the binary decision rule used most often in influential decision-making bodies, including the legislatures of democratic nations...
must be followed and cannot be abrogated by the chair.