The Need to Know Confidentiality and the Board

Most of the time, "communication" and "openness" are watchwords for boards and management. Clear, transparent communication between boards, managing agents, and shareholder/owners should be right up there with "location, location, location" as a mantra of successful urban living. But where does the line get drawn between what boards can - and should - discuss amongst themselves in closed board meetings, and what to discuss openly amongst all the shareholders? Well-publicized cases of corruption and opacity in corporate America have resulted in an increased demand for transparency and openness in all governing organizations - including co-op and condo boards - that is forcing some board members and agents to re-examine their own building policies.

Great Expectations

By all accounts, the expectations of board members versus shareholders about what constitutes an adequate exchange of information between the two groups can differ widely. It's not uncommon for non-board shareholders to feel that they're being kept in the dark and excluded from the decision-making process that directly affects their home.

Board members, by contrast, may feel that making those decisions is the very job they volunteered or were elected to do. And additionally, shareholders may not be aware that there are sensitive matters discussed in board meetings that should be kept confidential.

Pros and Cons

A policy of openness regarding board operations has both positives and negatives, depending on whom you talk to. Helen Hartig, an attorney who represents co-ops and condos and who also serves as president of her own Upper East Side co-op feels that an open meeting policy engages shareholders to become more involved.

Greg Carlson of Carlson Realty in Queens and the executive director of the Federation of New York Housing Cooperatives and Condominiums (FNYHC) agrees. "If the building maintains a policy of openness, and the board is meeting on a monthly basis, the benefit is that there's no pent-up aggravation among shareholders who feel they're not being heard."

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8 Comments

  • In Florida, luckily, Board meetings are required by law to be open and posted, for which I am glad. I strongly believe that the right to know what is going on in all condos and co-ops, is the right of all interested owners. Secrecy on the part of the board leads to bad and illegal practices, as in my condo.
  • Secretness Breeds Corruption on Thursday, October 23, 2008 7:46 PM
    Board meetings should be open, and then they could have executive session afterwards that are closed with minutes required of both the open and closed portions of the meetings.
  • Board meetings should be closed when sensitive topics such firing the super are discussed.
  • My Coop Sherwood Village B in Corona Queens have violated every rules on the Book ,we have a crooked Board member who made this Board a lifetime ditator seat for herself and she made sure she kept everyone in the dark from ordering office supplies in the thousand for her own personal use to singning bad contracts and we cant get the records of the corporation it's not available except in her personal computer.At every electio she stood up to seek unqualified members that will support her behavior of fraudulent activities .I need some help where do I go? I have been fighting this corrupt practices over two decade.Iread the cooperator all the times since I sign in for the paper and I need help.
  • Boy Joseph you really need a good lawyer. If you can prove any of this you should be able to file a lawsuit. Of course you need a competent lawyer and again, it will cost money. But I would sue them for your attorney's fees. Good Luck - I sympathize with you very much!
  • Tired-of-living-in-a-fiefdom on Tuesday, January 15, 2013 12:41 PM
    It's time for NY State to change the laws to require that: 1) boad meetings be open (with appropriate & specified exceptions), 2) adequate board meeting minutes be available promptly for free unfettered distribution at least to all shareholders who request them, & 3) minimum standands be established for board election procedures. Why is it that NYS law is so primitive in this respect?
  • My father (93, World War 2 Veteran enlisted for 3 years) and my mother 86 (writer for major magazine column for 26 years) were evicted out of their apartment at this age by cruel heartless managing agents and board members who had to know..in a large and famous Queens co-op near Great Neck, NY..They ran out of money and spent their life savings trying to hold on to their rental apartment (their home for 26 years!) having paid nearly $600,000 in rent over 26 years paying faithfully till the end when they ran out of money and were only 3 months in arrears! How disgusting is this??? The Board and management coveted their rental apartment which saw increases year after year for 26 years by the way.. and instead of calling a Board meeting and moving them to a smaller apartment on a lower floor and let them live out their lives, what was left of it, and there was plenty left! -they had No Dementia and were amazing people ..the Board and management pursued the eviction...it ended up killing my father from the stress of it all! He died six months after the papers were served! This is the secrets of the Board and management who could have done so much to help my parents instead they pursued them to the bitter end. How cruel is this? This could happen to anyone. There is a severe lack of affordable housing. My father should have felt that he could have attended a Board meeting to discuss the matter feeling safe that the place where he lived and paid his rent faithfully ($600,000.00 worth of rent...$400,000 more than the asking price for the apartment when they moved in by the way-they had an option at the time to rent or buy when they first moved in- they chose to rent thinking they might not live so long...) Had my father felt that he could have safely approached the Board and management he would have done so. There is nothing but sinful behavior here. How do you evict a 93 year old man and his 86 year of wife of 67 years???? Sinful, sinful behavior. No ethics, just greed. This must change. We need to protect people, build affordable decent housing and protect our elderly!
  • I agree Beth. I'm sorry for what your family went through. My Co-op in Michigan disliked one of our tenants and continuously tried to remove her and her family. Did nasty things to try and make them move. Then she fell to breast cancer and left her unit to her son before she passed. That caused an up-rise in the community. How horrible can people be to treat others with such disrespect.