Up North, Tossing Snowballs at a 90-Year-Old Nonprofit Law

The last time Canada enacted legislation governing nonprofits, reports the Law Times, “Henry Ford’s Model T was still making inroads, coal was king, and business was a paper-intensive exercise.”

Federal and provincial governments in Canada are now considering bringing nonprofit law into the digital age, and not a moment too soon.

That change is needed is accepted by all parties, [William Pashby, partner at Borden Ladner Gervais LLP,] says, noting the current process of simply registering is vaguely defined and encumbered by a series of policy statements which are out of context with the law as written and subject to dispute.

The plan, says his colleague Bonnie Freedman, is to streamline the process, bring some transparency to operations in line with current corporate-governance thinking, and set out clearly what directors’ responsibilities and liabilities are and what members’ rights are.

Currently, she says, the process is cumbersome and lengthy, requiring four to six weeks to complete, compared to a for-profit incorporation, which can be done in a matter of minutes.

Times change, of course, and especially these days, when technological and commercial advances happen at lightning speed. Kudos to the Canadians for trying to modernize the law — and a small slap for taking so long to do so. For nonprofits in other countries, the question is this: Does your nation’s governance reflect the current reality regarding your sector? If not, by all means tell your government relations types to start working the phones. | 501(c)