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Seal of Accountability

Employees on the Board

October 10, 2006

CCCC Standard Two, Independent Active Board, includes the phrase "No member of the governing board shall be entitled to receive, either directly or indirectly, any salary, wages, fees, commissions or other amount for services rendered to the organization." This precludes a Certified member’s employees from being board members.

CCCC Standards are not simply restatements of the law, and may or may not have a legal basis. They are standards that Certified CCCC members have voluntarily agreed to abide by. The rationale for this Standard includes promoting accountability and avoidance of either actual conflict of interest or the appearance of conflict of interest. Affiliate CCCC members are not obligated to comply with the Standards as they have only agreed to adhere to our Code of Ethics.

From a legal standpoint, CCCC recognizes that common law, legislation, regulations, regulators or administrative practices may allow a charity to do something that the Standards do not permit. In respect of Standard Two, the law across much of Canada does not explicitly prohibit an employee from being a board member. Ontario has the clearest law prohibiting paid employees being board members (with very few exceptions), but in most of the common law provinces, the existing British precedents against employees as board members are untested in the courts. Quebec does permit remunerating board members and officers unless the organization itself decides to prohibit the practice. The Income Tax Act of Canada does permit paid board members, but this is only from a tax standpoint. It does not consider other legislation or common law.

CCCC gives the following advice to Affiliate members enquiring about this issue:

  • Best practice is to exclude employees from board membership.
  • Any charity still wanting an employee as a board member should get legal advice specific to their province and constating documents. (Denominational offices may already have this for their churches.)
  • In situations of legal uncertainty, we leave local churches to make their own decisions. We recommend that all other ministries leave their employees off the board.
  • Employees who are not board members may in all cases be given the right to attend board meetings and to speak.

Return to Standard 2

 
 

"CCCC is uniquely positioned to raise awareness about integrity in ministry by giving or withholding the Seal of Accountability and holding members to the highest possible standards."

- Billy Graham