The Importance of Code of Ethics for Condominium/HOA Board Members
When it comes to condo and home owner’s association management, it is always good practice to set a code of ethics for the Board of Directors. As a Board member you should act in the best interests of the corporation/association. In fact, the act has set a general standard for the members to follow and requires Board members to act in an honest manner and in good faith to the corporation/association. Having a code of ethics will help in increasing the chances that everyone on the board will act in an ethical and honest manner.
All condo boards should take a proactive step of formulating and adopting code of ethics for its Board members. There are many ways that this can help in contributing to the success of the community.
Anyone holding an important position in a corporation is required to maintain honesty. When there is a formal code of ethics in place, it will help in ensuring that you can hold members accountable if there is any case of unethical conduct.
Anyone who is a Board member should set the example for good conduct. When you create a code of ethics for the board, it can also set a level of conduct that is expected from all the members. It can highlight the standards for what is acceptable and what is not, thus preventing the members from any controversial behaviour.
All board members should keep all business of the board confidential or privileged. You will want to add this to your code of ethics.
Minimizing Conflicts of Interest
Situations can arise where a Director can find opportunities and can attempt to promote their interests above those of the community. In other words, there can be a conflict of interest. This can happen when a Board member has a relative who is a vendor providing repair and maintenance services. When there is a code of ethics in place, it can help in addressing such situations. The code must require all members to disclose any conflicts of interest. It should also outline what process should be followed if such a situation arises or when there is a violation.
Elaborate Code of Ethics
It can be difficult for a condo Board to create an elaborate code of ethics that covers all aspects of condominium management. It can cover other aspects including the importance of democracy, good conduct, and supporting the decisions of the board. Your condo management company can help in closing the gap between the code of ethics and your community’s bylaws.
Sample of a Code of Ethics for a Condominium Board can be found on the Canadian Condominium Institute website: https://ccisouthalberta.com/resources/director-ethics