[Updated 2025]Many people struggle to understand who really runs a nonprofit organization. You might ask, do voting members make big decisions or does the board of directors hold all the control? This question pops up often when setting up a charity or community group.
Here is one thing you need to know: Voting members help keep things fair by allowing more voices in board elections and key choices. Still, some nonprofits choose self-perpetuating boards instead for stability.
Too many rules can lead to confusion about who gets what power.
This blog breaks down both structures using clear language and simple examples. We will look at how each system works, show where they fit best, and share tips for better nonprofit governance.
Key Takeaways
- Voting members give more people a say in board elections and big decisions. Groups like the Sierra Club (2004) have faced problems when new members tried to change their mission. Clear bylaws help stop confusion or power struggles.
- Self-perpetuating boards let current board directors pick new ones. This keeps control steady but can lead to closed groups if they do not add fresh voices often.
- State laws, such as those in California and New York, set rules for both models. Nonprofits must write clear bylaws that list who can vote, term limits, and steps for changing structure.
- Changing from voting members to a self-perpetuating board is hard. It needs approval from most or all voting members—sometimes by two-thirds vote—and can cause fights inside the group.
- Use legal guides or nonprofit experts when setting up your governance model. Good planning now helps avoid confusion and keeps your group focused on its mission.
Voting Members in a Nonprofit Organization
Voting members play a big role in guiding many nonprofit corporations. Their right to take part in board elections shapes how charitable organizations carry out their stated purposes.
Purpose and Common Use
Structures with voting memberships give democratic control to people who care about the nonprofit organization. These members, like those in social clubs, churches, trade groups, and chambers of commerce, get a real say through board elections or votes on big changes.
Nonprofit corporations often use this structure when they want their main supporters to help guide policies and goals.
Members often pay dues or meet certain rules set by the board bylaws or articles of incorporation. This setup works well for charitable organizations where people have a direct interest in activities and outcomes.
The next section explains how having many voices shapes control within these nonprofits—and why strong clarity is key for good nonprofit governance.
Control and Importance of Clarity
Clear rules about control help a nonprofit organization avoid confusion. Voting members often have rights similar to shareholders in business corporations under state law. This means they can elect the board of directors, vote on major changes, or even remove leaders if needed.
If nonprofit bylaws are unclear, an organization might unknowingly create a voting membership structure by accident. That mistake gives people power they were not meant to have.
Board bylaws and other governing documents must spell out who has voting rights and what those rights mean. Any lack of clarity could lead to legal trouble or arguments inside the group.
For example, some states treat regular donors as members unless nonprofits state otherwise in their bylaws. Clarity helps prevent disputes over control that distract from charitable purposes and good governance structure.
Always double-check documents before approving them at board elections or amending existing rules for your non-profit organization.
Challenges and Governance Complications
Groups with voting membership structures must keep careful records. State law often requires a current list of eligible voting members. If the roster is not up to date, board elections can face disputes or may even become invalid.
Nonprofit organizations also have to organize member meetings, follow quorum rules, and record votes accurately.
Altering a nonprofit’s governance structure takes more than a simple decision by the board of directors; it may require consent from
members themselves. This process can get complex—especially once formal memberships are in place.
In 2004, the Sierra Club faced public fights between different groups inside its membership, showing how factionalism can complicate nonprofit governance.
A clear process for updating bylaws and managing member rights helps prevent confusion and conflict.
Risk of internal conflicts often leads some nonprofits to consider other models like self-perpetuating boards instead.
Risk of Factionalism and Sierra Club Case
Voting membership structures can make a nonprofit organization open to factions. Easy member access sometimes lets outside groups join and steer the group in a new direction, often far from its mission.
In 2004, the Sierra Club faced this risk. An anti-immigration faction organized hundreds of people to sign up as voting members. Their goal was to win board elections and push their views inside the group.
Long-term supporters grew worried about losing control of the board of directors and the club’s direction. In this case, clear bylaws stopped the takeover before real damage happened.
Nonprofit governance works best when rules protect against fast changes caused by special interest groups or sudden new members.
Self-Perpetuating Boards
Self-perpetuating boards give the board of directors full power to choose new members, and this setup brings both steady leadership and risks—keep reading to see how these choices shape nonprofit governance.
Definition and Authority
In a nonprofit organization with a self-perpetuating board, the Board of Directors holds the main authority. This means board members themselves choose who will join or leave the board.
There is no voting membership structure where outside groups or individuals get to vote in these elections. The current directors handle all selection and replacement through their own votes.
Many charities use this governance structure for stability and control. The board can set long-term goals without disruption from large shifts in membership opinion or public elections.
Self-perpetuating boards manage nonprofit bylaws, approve major changes, guide financial decisions, and hire executive staff if needed. These duties keep power within a focused group instead of spreading it across many voting members.
Stability vs. Insularity
After defining the authority of self-perpetuating boards, it is key to look at their effects on nonprofit governance. Self-perpetuating boards often give a nonprofit organization stability.
The same group can provide steady leadership and stick to long-term goals. This helps with planning and limits sudden shifts from outside board elections.
Still, risks appear if these boards do not bring in new members often enough. A board may stop listening to current needs or new ideas if it becomes closed off from fresh voices. Insularity makes a voting membership structure less useful over time; it can even harm a group’s mission if leaders ignore needed changes or feedback from nonvoting members or the broader community.
Keeping bylaws clear about terms and renewal helps address this problem for many charities and associations like public foundations and health organizations.
Combination with Nonvoting Members and Rights of Nonvoting Members
Some nonprofit organizations have both self-perpetuating boards and nonvoting members. Nonvoting members often pay dues, but they do not control board elections or make decisions about the governance structure.
Their involvement is usually limited to benefits such as free annual admission to exhibits, discounts at museum gift shops, or special event invitations.
Board bylaws must clearly state what rights nonvoting members hold. Ambiguous governing documents can cause confusion—sometimes even leading to unintended legal rights for these members.
Careful wording ensures only the voting membership structure and board of directors have real authority in nonprofit governance decisions.
Comparison of Governance Structures
Choosing between a voting membership structure or self-perpetuating board affects how a nonprofit organization runs and makes decisions—think about how your board of directors and bylaws set the rules.
This section offers clear points to help leaders compare these common models in nonprofit governance.
Key Considerations
Clear rules stand at the center of any nonprofit governance structure. In a voting membership structure, members pick the board of directors through elections. The bylaws must say who can vote and how elections work; unclear rules often lead to confusion or even legal fights.
Self-perpetuating boards handle new board member selection on their own, which can help with stability but may close out outside voices over time.
Some groups try hybrid models by mixing self-perpetuating boards with nonvoting members who have limited rights. Legal requirements depend on state law; for example, California and New York set strict standards in this area.
Changing from one governance structure to another calls for updates in board bylaws and sometimes needs approval by both the current board and voting members. A checklist helps track these steps before changes take effect in your nonprofit organization’s control system.
Legal Basis and Bylaws
State laws allow a nonprofit organization to use a voting membership structure, a self-perpetuating board of directors, or even a mix of both. Every group must spell out the details in their board bylaws.
These rules should list term limits, show who can vote, and explain how to remove members or directors.
Lack of clarity invites legal trouble and confusion about rights and roles. The IRS also wants clear governance structures for tax-exempt groups like 501(c)(3) organizations. Using strong language in your bylaws keeps everyone on track…and helps prevent most disputes before they begin.
Changing Structures
Changing who has control in a nonprofit organization takes effort. Shifting from voting members to a self-perpetuating board is not simple.
- Voting members must approve changes to the governance structure, including giving up their own power under most nonprofit bylaws.
- This often causes resistance, as people do not want to lose their say in board elections or major decisions.
- A famous test of this happened at Sierra Club, where splitting factions made it very hard to change the voting membership structure.
- Clear rules must exist in the current bylaws stating how changes can happen; these are legal documents that guide the process.
- State law may require a super majority vote, for example, two-thirds approval from all voting members for big shifts like moving to self-perpetuating boards.
- Talking openly and early with all parties helps avoid confusion or fairness complaints during structural changes.
- Outside advisors such as nonprofit lawyers or consultants provide guidance on proper procedures for amending board bylaws and making switchovers valid under state statutes.
Key considerations also include how either structure supports long-term stability while keeping public trust and good nonprofit governance practices at the core… which leads directly into reviewing key aspects of both options.
Conclusion
Both voting members and self-perpetuating boards shape how a nonprofit organization works. Having voting members keeps control in the hands of people who care deeply about the mission, but it can make board elections tricky and bring new governance issues.
Self-perpetuating boards offer steady leadership, though they can sometimes lose touch unless refreshed often. Think about your own group’s needs—do you want greater democracy or more stability?
If you need help with board bylaws or choosing a good governance structure, great guides and legal tools are just a click away; careful choices now will mean smoother days ahead for your nonprofit’s future.
FAQs
1. What is the main difference between voting members and self-perpetuating boards in a nonprofit organization?
A board of directors with voting members lets people outside the board vote on major decisions. In contrast, self-perpetuating boards choose their own new members without input from a larger group.
2. How does a voting membership structure affect nonprofit governance?
Voting membership structures give more power to regular members. They can approve changes to bylaws or pick who joins the board of directors, shaping the governance structure directly.
3. Why do some nonprofits use self-perpetuating boards instead of having voting members?
Some nonprofits want stable leadership and faster decisions; they let current board members select new ones during board elections. This keeps control within the existing group but limits wider participation.
4. Where are rules about these structures usually found?
Rules for both voting member systems and self-perpetuating boards appear in an organization’s bylaws; these guide how board elections work and outline each group’s powers within nonprofit governance.
Ellis Carter is a nonprofit lawyer with Caritas Law Group, PC. To contact Ellis, call 602-456-0071 or email us at info@caritaslawgroup.com.