JUST over a month before the CBH Group 2021 Annual General Meeting (AGM), it has been brought to light that decisions made by the board since April could be invalid as the board has been operating in breach of the co-operative's constitution.
According to Rule 30.3 of the CBH Constitution, the co-operative must have a minimum of nine and a maximum of 12 directors, which comprises nine member directors and up to three independent directors.
There are two directors elected by members from each of districts 1, 2, 3 and 4 and one director elected by members from district 5.
However, after the resignation of former chairman Wally Newman last April and the dismissal by the members of Trevor Badger one month later, district 4 has been a representative down.
In July last year, Helen Woodhams of Kojonup was elected by the members to district 4, however with the announcement of a governance review, CBH made the decision not to replace the second vacant position in the district.
Shire of Wagin president and local farmer Phillip Blight said from what he can understand, CBH has been operating in breach of its constitution since Mr Badger was removed from the board.
"Their constitution says, quite clearly, that there will be nine grower board members, but we don't and haven't since May," Mr Blight said.
"Our constitution has two options to replace a member, one is that the board can simply appoint someone in the interim, which they chose not to do.
"The other alternative is to hold a by-election, which they did, but only for one of the vacancies, not both."
CBH company secretary David Woolfe has defended the co-operative's decision.
"While the current CBH rules provide for nine member directors in the usual course, the rules specifically recognise that there can be casual vacancies for some periods due to directors resigning, being removed by members or dying and that there can be less than nine member directors during those periods," Mr Woolfe said.
"Following the casual vacancies caused by the resignation of Wally Newman and the removal of Trevor Badger, a comprehensive governance review was undertaken following which a proposal will be considered to reduce the size of the board at next month's AGM.
"In view of this proposal it is appropriate and in accordance with CBH's rules for members to have their say on this proposal in order to determine whether existing board vacancies should be replaced.
"As the board has previously advised members, if members do not support a reduced board size then district elections will be held as soon as possible after the AGM to return to there being nine member directors."
While CBH's explanation does state that the rules allow for there to be casual vacancies for some periods, by the time the AGM rolls around, it will have been 10 months since the board was full.
When CBH announced its governance review in June, chairman Simon Stead said the decision to only elect one director in the by-election was in light of the fact that one of the things the review was to consider was board size.
At the AGM scheduled for Thursday, February 25, CBH members will vote on a resolution to reduce the board size to a total of 10 directors and introduce a hybrid model which includes five district-elected member directors, two statewide-elected member directors and up to three independent directors.
However Newdegate farmer Bob Iffla said the governance review and possible rule changes were irrelevant until they're actually voted on.
"CBH needs to go along with what the rules of the constitution are, regardless as to what possible changes are pending as a result of the governance review," Mr Iffla said.
"If the vote at the AGM says members don't want as many directors, that's another issue entirely but they need to have complied with the constitution before that and it's poor governance that they haven't."
Mr Blight believes it ironic that in the process of doing a governance review, CBH has ignored a basic and fundamental part of its own constitutionally prescribed governance process.
"I'm such a fan of CBH and it shocks me that they can mess it up so badly when it's so simple to have got it right," he said.
"All they had to do at the next board meeting after Trevor was dismissed was present a timeline for an election for another director, instead of that they've gone off on this crazy tangent of a board restructure."
At the beginning of the year, nominations for the districts 3 and district 5 member director elections were closed, with Simon Stead and Natalie Browning re-elected unopposed.
In district 1, one director position was also due for election this year, with Brian McAlpine informing the board last year that he did not wish to nominate for a further term.
However, in November, CBH announced that no district 1 election would be held (at the same time as districts 4 and 5), with the plan to instead wait on the results of the AGM vote to see if the position required replacing.
"It appears to me that they haven't been operating in line with the constitution," Mr Iffla said.
"It's just crazy that the Albany zone (district 4) has been under-represented and I believe that an election should have been held in the Geraldton zone (district 1) as well.
"If there's a vacancy there, CBH should call for nominations and once a vote is conducted, someone is sworn in, it's a simple process and it's crazy that it hasn't happened."
Along with the constitution debate, growers have also raised concerns about the voting system for the four resolutions being proposed at the AGM.
For those wishing to vote in advance, the voting system automatically opens with each of the four resolutions on 'open',
Growers argue that it would be fairer if the system opened on 'abstain', so that if someone submitted a vote accidentally without changing the preset tab, their vote couldn't be misused.