condo governance

A missing condo governance best practice

Board orientations are a custom in other institutions
Tuesday, March 16, 2021
By Alexander Ramirez

What is the first thing that comes to mind when we think about a condominium? The response can vary significantly depending on whom you ask. The same level of diversity in potential responses is a mirror reflection of the nuances that compose the institution of condo governance. Where there are people, there is conflict. Where there is conflict, there is politics.

Condos are filled with people. The ability to navigate the political processes of a condo can be very challenging. The magnitude of diverse (and competing) interests, egos and money that are involved in the industry replicates that of a government, a microcosm of the macrocosm. Yet, it is a very unique and distinct political animal, especially when trying to navigate it.

A condominium is a nonprofit corporation, quasi-administered through government regulatory bodies, with elected officers who are also shareholders of the corporation. These dynamics are what give rise to the designated term “condoland,” and also why governing such a unique institution necessitates governance best practices.

One of the unique elements of condo governance is the fact that there are elections held every year at the AGM. This presents both challenges and opportunities, depending on whom you ask. Most governments require much longer than 12 months to accomplish planning and administering their agendas. These processes often require years. With condo boards dealing with changes in directors on an annual or sometimes bi-annual basis (depending on term durations), this presents a significant challenge, especially when newly elected directors join with competing interests or agendas they want to introduce. In addition, you have the AGM input from unit owners that the board is expected to act upon as quickly as possible.

The stakeholder who traditionally becomes overwhelmed by this process ends up being the property manager, tasked with having to navigate these political dynamics, in addition to the maintenance and operations of the facility, not to mention community engagement.

When looking at options for ensuring a successful onboarding and transition of newly elected directors, it’s best to look at what other institutions with similar processes implement as best practice. Looking at non-profit, corporate and government institutions, there is a best practice that is used when onboarding newly elected officials to an executive governing body, and is coincidentally not practiced in the condominium sector. That practice is board orientations.

The practice of board orientations

Non-profit corporations dedicate full days to exclusively focus on orientation workshops with a new board, often done so annually to coincide with a new term. These workshops allow directors to understand one another’s individual interests and goals for their term, and also review what the organization’s overall goals are for the term ahead, so that everyone is on the same page and has a clear understanding. In the corporate sector, the same concepts are implemented. Executive boards go off on weekend retreats dedicated for the same purpose. Informal meetings, with the help of external facilitators at times, ensure each director understands the macro goals for the year of the term ahead. These retreats are in essence a board orientation.

Governments do the same. At the federal and provincial levels, when cabinet ministers are appointed, the entire cabinet—acting as the executive authority of the government—meet as a group, at times for extended periods. This is to ensure they concur with the agenda of the governing party and how they are going to move forward with their executive road map. It is another form of a board orientation, an executive governing body ensuring its representatives have a clear understanding of what the goals and priorities will be for the term ahead and their designated responsibilities in achieving those goals. The practice of board orientations, particularly after AGMs, is not implemented as a standard governance best practice across condoland, but it should be.

This is where there is tremendous opportunity to help navigate the unique political dynamics of condo governance. Conducting board orientation meetings immediately after AGMs (within one to two weeks) provides the opportunity for board members to share their individual priorities and gain a better understanding of one another. All it takes is one new director to get elected to have a completely new board composition.

Board orientations also help prioritize the feedback of unit owners from the AGM and organize them as part of the agenda for the term ahead in an efficient manner. Implementing this subtle best practice in the form of an informal orientation meeting can go a very long way in alleviating the burdens of navigating the unique political animal that is condoland.

Alexander Ramirez is a principal at CondoHarmony Inc. He holds a combined honours BA in political science and labour studies from McMaster University and a graduate certificate in dispute resolution from York University. His specialized practice focuses on proactive dispute resolution with administrative board governance.

1 thought on “A missing condo governance best practice

  1. Yes, I totally agree with the author! All the board members should meet up sometime right after the AGM and share among them with their WISH LIST…, also review the questions being raised in the AGM. Going through the brainstorming process, then the board members may easily come up with a reasonable and realistic broad direction leading to good governance! And priorities will be set and follow to best serve the residents in their property! I see INTEGRITY & DEDICATION of board directors are also important!

Leave a Reply

Your email address will not be published. Required fields are marked *