Policy on Director Recruitment

I. Purpose and interpretation

1. The purpose of this policy is to establish a clear and transparent process for the recruitment, election and appointment of the Sector Directors and Non-Sector Directors to the Board, ensuring that the Board is composed of individuals with the necessary skills, experience and commitment to effectively govern the organization.
2. In this Policy, the following terms shall have the following meanings:

   "Act" means the Not-for-Profit Corporations Act, 2010, S.O. c.15, and the regulations thereunder, as from time to time amended, and every statute and regulation thereunder that may be substituted therefor and, in the case of such substitution, any references in the by-Laws of the Corporation to provisions of the Act shall be read as references to the substituted provisions therefor in the new statute or regulations;

   "Administrator" means Administrator, Board Support Services;

   "Annual Meeting" means the annual meeting of members at which an election is held to appoint Board Directors;

   "Applicant" is an individual who is applying for a position as a Non-Sector Director or Sector Director;

   "Board" means RECO’s Board of Directors, comprised of Non-Sector Directors, Sector Directors, and Ministerial Appointees;

   "By-Law" means RECO By-Law No.1;

   "Campaign Guidelines" means the document which sets out campaigning guidelines for candidates;

   "Candidate" is an Applicant that has been accepted for review by the Nominations Committee;

   "Corporation" means Real Estate Council of Ontario (RECO);

   "Director" means any of a Non-Sector Director, Sector Director or Ministerial Director;

   "Final List of Candidates" means those Candidates who the Nominations Committee is recommending for approval by the Board, and ultimately for election by the members at the Annual Meeting;

   "Ministerial Director" is a Director on the RECO Board that has been placed there by the authority of the Minister;

   "Nominations Committee" means the Nominations Committee of the Board;

   "Non-Sector Director" means those Directors of the Corporation elected by the members and who are not drawn from among any of the following classes of persons:

   1. Registered brokers or salespersons,
   2. Individuals who are directors, officers, employees, members or agents of registered brokerages,
   3. Individuals who are directors, officers, employees, members or agents of an industry association representing the interest of registrants, and
   4. Individuals who within the one-year period before becoming a director of the Board met the description of any clauses i. through iii;
   1. "Sector Director"
   1. means those
   1. Directors
   1. of the
   1. Corporation
   1. elected by the members and who are registered brokers or salespersons.
   2. "REBBA" means the Real Estate and Business Brokers Act, 2002, S.O. 2002, c.30, Sched. C (replaced by TRESA on December 1, 2023);

   
   

   "RECO" means the Real Estate Council of Ontario;

   "Term of office" means the total time in office for a particular director position, which mostly is a three year Term, but can be of other lengths;

   "TRESA" means the Trust in Real Estate Services Act, 2002, S.O. 2002, c.30, Sched. C, and the regulations thereunder as from time to time amended and every statute and regulation that may be substituted therefor and, in the case of such substitution, any references in the by-laws of the Corporation to the provisions of TRESA shall be read as references to the substituted provisions therefor in the new statute or regulations;

   "Video Guidelines" means a document that sets out the technical and production guidelines that candidates use for the purpose of campaigning.

II. Scope and responsibilities

This policy shall apply to the recruitment of Sector and Non-Sector Directors for the Board.

III. Legal and policy context

This Policy shall be read and interpreted in a manner consistent with the following legal and policy framework, it being intended that the Policy shall be compliant with relevant law and policy.

• Not-for-Profit Corporations Act, 2010, S.O. 2010, c.15
• Trust in Real Estate Services Act, 2002, S.O. 2002, c. 30, Sched. C
• Safety and Consumer Statutes Administration Act, 1996, S.O. 1996, c.19
• The Administrative Agreement between RECO and Her Majesty the Queen in Right of Ontario, dated 5 February 2013
• RECO’s By-Law No.1

IV. Introduction

An election process will be initiated annually in September to recruit Sector Directors and Non-Sector Directors to fill vacancies, as required by the By-Law and in a manner consistent with good stewardship in the public interest. The process is concluded when the vacancies are filled by the election and appointment of candidates at the Annual Meeting in the following year.

1. Subject to the qualifications and any applicable law, effective June 1, 2024, no more than thirty-four per cent of members of the Board shall be drawn from among any of the following classes of persons:
   1. Registered brokers or salespersons.
   2. Individuals who are directors, officers, employees, members or agents of registered brokerages.
   3. Individuals who are directors, officers, employees, members or agents of an industry association representing the interests of registrants.
   4. Individuals who within the one-year period before becoming a director of the board of the administrative authority met the description in any of clauses i through iii.
2. For clarity, the 34% in paragraph a) is calculated with reference to the full nine (9) member Board even if some positions are vacant.
3. The nine (9) member Board will include Ministerial Directors, elected Sector Directors and elected Non-Sector Directorsas follows:
   1. Ministerial Directors, being individuals appointed by the Minister under the Safety and Consumer Statutes Administration Act, 1996; and
   2. No more than three (3) Sector Directors elected by members;
   3. Subject to i. and ii. of paragraph c), the balance of the directors shall be Non-Sector Directors elected by the members.
   4. For certainty, in the event that a Ministerial Directoris appointed from among the following classes of person:
      • Registered brokers or salespersons.
      • Individuals who are directors, officers, employees, members or agents of registered brokerages.
      • Individuals who are directors, officers, employees, members or agents of an industry association representing the interests of registrants.
      • Individuals who within the one-year period before becoming a director of the Board met the description of any clauses i through iii, then an elected Sector Director will be required to vacate in accordance with the By-law.

V. Qualifications

Each Sector Director and Non-Sector Director must be an individual who is at least 18 years of age and has not been found incapable under the Substitute Decisions Act, 1992 (or its successor) or under the Mental Health Act (or its successor) of managing property and has not been found to be incapable by any court in Canada or elsewhere and has not been found to have the status of bankrupt. Each Director must consent in writing to hold office as a Director within ten (10) days after the election or appointment except for a Director who is re-elected or re-appointed and there is no break in such Director’s Term of Office. The following are additional qualifications for elected Sector Directors and elected Non-Sector Directors:

1. The individual must possess a positive orientation for proactive consumer protection initiatives;
2. The individual must not be an employee, director or officer of any real estate trade association;
3. The individual must not have been found by the Discipline Committee of the Corporation to have contravened TRESA (or REBBA), the regulations under TRESA (or REBBA), including the Code of Ethics regulation, or had a similar finding by any other regulatory body or professional association in the last five (5) years;
4. The individual must not have had a professional licence or registration refused, suspended, revoked or subject to conditions to which they did not consent in the last five (5) years; and
5. The individual must not have been found guilty of a provincial or criminal offence that is relevant to their suitability to serve on the Board for which a pardon or record suspension has not been granted.

VI. Principles

1. Consumer protection: All Directors must possess a positive orientation for proactive consumer protection initiatives and must have the competency to effectively advance RECO’s consumer protection mandate.
2. Diversity and inclusion: The recruitment process will promote diversity and inclusion, ensuring representation from various backgrounds, skills and perspectives.
3. Transparency: The process will be open and transparent, with clear criteria and procedures.
4. Merit-based selection: Candidates will be selected based on their skills and the requirement of those skills on the Board, experience, and alignment with the organization’s mission, vision, values and RECO’s consumer protection mandate.

VII. Recruitment - General

1. The Nominations Committee is responsible for soliciting applications for and preparing a Final List of Candidates for each Sector Director position which will become vacant and soliciting applications for and recommending a candidate for each Non-Sector Director position which will be becoming vacant and for which an election is to be held at an Annual Meeting of members.
2. The Nominations Committee shall establish, from time to time, criteria, qualifications and competencies(set out in the Board skills matrix) in addition to the qualifications set out in the Act and By-Law, to be applied to each Candidate equally and which must be satisfied by each Applicant to be considered for a Sector Director or Non-Sector Director
3. Eligibility criteria shall not include a requirement that an Applicant must be a member of an industry association representing the interests of registrants. For certainty, this does not preclude Applicants from being a member of these industry associations.
4. In accordance with the By-Law, the Nominations Committee shall oversee the recruitment process, making recommendations to the Board of Directors.
5. The Nominations Committee may consider retaining the services of an external recruitment firm or other consultant. Consideration must be given to allow sufficient time to engage in the procurement process for the external consultant.
6. Annually, and prior to the commencement of the election process in September, the Chief Executive Officer of RECO and/or the Administrator will contact existing Sector Directors and Non-Sector Directors whose Terms of Office are concluding at the end of the Annual Meeting, requesting that they declare their intention either of not seeking re-election, or otherwise of the possibility of seeking re-election. In the event of a declaration of the latter, the Non-Sector Director or Sector Director shall declare a conflict of interest and recuse themselves from all agenda items at all meetings related to the election process. Once a Non-Sector Director or Sector Director has made such a declaration, it will remain unchanged until the conclusion of that election cycle. As these declarations may affect the membership of the Nominations Committee, additional Directors may be assigned to the Nominations Committee by the Board to ensure it can discharge its recruitment mandate.
7. On an annual basis, at the beginning of the recruitment process, the Nominations Committee will conduct a skills and attributes audit, including diversity, of the current Board to identify gaps and determine the specific criteria, qualifications and competencies needed to complement the existing Board.
8. On an annual basis, the Nominations Committee will create a position brief, an application form, information package for candidates and other supporting materials.
9. On an annual basis, the Nominations Committee will review the recruitment communications plan.
10. Filling Vacancies (Sector and Non-Sector Directors). A vacancy occurring on the Board in the office of a Sector Director or Non-Sector Director shall be filled in accordance with By-Law No.1, section 2.8, Filling Vacancies (Sector and Non-Sector Directors). The Nominations Committee is to make recommendations to the Board of Directors regarding individuals who are qualified to fill vacancies.

VIII. Terms of office

1. Subject to section (b) below, each elected Sector Director and Non-Sector Director shall hold a Term of office of three (3) years. A Sector Director or Non-Sector Director, if otherwise qualified, is eligible for re-election to the Board upon the expiration of such director's Term of office, provided that an elected Director shall not be reappointed or re-elected if the Director has served an aggregate of ten (10) or more years in office.
2. The first three Sector Directors who are elected after June 1, 2024, shall be elected for an initial term of two (2) years, three (3) years or four (4) years as required and determined by the Board, resulting in one Sector Director vacancy at each subsequent annual meeting, as of the 2027 AGM. Subsequent to the first three Sector Directors being elected after June 1, 2024, Sector Directors shall be elected for three (3) year terms of office.

IX. Recruitment – specifics

1. Application and Approval Process
   1. In advance of the Annual Meeting at which an election is required, the Nominations Committee shall solicit applications for all Non-Sector Director or Sector Director positions which will become vacant and review the applications against the established criteria, qualifications and competencies.
   2. The candidates nominated by the Nominations Committee must be ratified by the Board in advance of the Annual Meeting. Unsuccessful candidates will be advised following the Board ratification.
   3. Following ratification by the Board, the names of the candidates must be circulated to the members as required.
2. Non-Sector Director
   1. On a date set by the Nominations Committee, a call for applications shall be posted on RECO’s website, the recruitment consultant’s website (if applicable), and other media channels as appropriate. Interested persons who qualify will be asked to submit an application, including a resume and cover letter outlining their interest and qualifications, and complete a conflict of interest disclosure form.
   2. The Nominations Committee, along with the recruitment consultant (if applicable) will compile a list of Applicants which best meet the established criteria, qualifications and competencies through a process of shortlisting and individual interviews. Reference checks will be conducted on the final list of Applicants. One candidate per vacancy will be presented to the Boardfor ratification at a regular or special meeting scheduled such that adequate time is allotted to provide notice to members.
3. Sector Director
   1. On a date set by the Nominations Committee, the application form, as approved by the Board, together with a form of written consent of the candidate to hold office for any of the Terms of Office to fill a vacancy for the position of Sector Director, and conflict of interest disclosure form, shall be available on RECO’s website.
   2. The Nominations Committee shall establish a date which serves as a deadline for members to submit applications.
   3. Members wishing to be considered for election must be nominated by two individual members, neither of whom is a candidate for a Sector Director.
   4. The Nominations Committee, in conjunction with an external consultant (if applicable), will compile a list of candidates, in order, who best meet the established criteria, qualifications and competencies through a process of shortlisting and individual interviews.
   5. Through a process of evaluation and interview, the Nominations Committee will present the Final List of Candidates comprising of those candidates who best meet the needs of the Board based on the established criteria, qualifications and competencies (between 2 and 5 candidates per vacancy unless the number of applicants precludes that), for ratification by the Board at a regular or special meeting scheduled such that adequate time is allotted to provide notice to members.
   6. Following ratification by the Board, and on a date determined by the Nominations Committee, the Final List of Candidates will be notified of their successful applications, and their respective photos, bios and videos will be made public on RECO’s website, after which campaigning may begin, subject to sections vii, viii and ix below. Unsuccessful applicants will be duly notified at the same time.
   7. The Final List of Candidates are to submit two campaigning videos by a date and time determined by the Nominations Committee. One video (maximum two (2) minutes in length) is for use on RECO’s website and one video (maximum 45 seconds in length) to be presented at the Annual Meeting at which the election is taking place. The latter video will be the sole opportunity for candidates to address members at the Annual Meeting. RECO’s Video Guidelines document is to be referenced by all Candidates. RECO reserves the right to disqualify any videos which do not meet the guidelines provided.
   8. The Final List of Candidates may campaign for a period determined by the Nominations Committee and must adhere to the Campaign Guidelines.
   9. For certainty, any campaigning (including videos) that is inappropriate in the opinion of the Nominations Committee, or otherwise irrelevant to RECO’s mandate and the mandate of the Board, may cause disqualification of the Candidate in the event that the Candidate does not address those issues.

X. Election at the Annual Meeting

1. Non-Sector Directors 
   1. A motion naming the Non-Sector Director Candidate(s) shall be presented at the Annual Meeting of the members. The members shall by ordinary resolution elect and appoint the Candidates as Non-Sector Directors to hold office subject to the Act and By-Law.
2. Sector Directors 
   1. An election at the Annual Meeting by ordinary resolution will determine the successful Candidate(s) from the Final List of Candidates. Each member in attendance at the Annual Meeting is entitled to cast one vote for each position for which an election is being held. If the Final List of Candidates eligible to be elected is greater than the number of Sector Director vacancies, a vote shall be conducted to elect the required number of Sector Directors, where the Candidate who receives a majority with the highest number of votes wins. In the case of a tie between two or more Candidates, a second vote amongst those Candidates will determine the successful Candidate.
   2. In the event that any vacancies attract a Term of Office other than three years, the order of elections will be the vacancy with the longest Term of Office to the shortest.
   3. If the Final List of Candidates is equal to the number of vacancies, but the Terms of Office are dissimilar amongst the vacancies, members will hold an election to determine the Term of Office for each Candidate.

RECO’s recruitment process is designed to identify candidates who best meet the needs of the Board based on the established criteria, qualifications and competencies. In accordance with the Administrative Agreement, any motion from the floor that affects the Board composition or selection criteria or process and terms of office of its members shall not be entertained or put to the vote of the membership unless the motion has been reviewed and approved by the Minister.

XI. Review and evaluation

On an annual basis, the Nominations Committee will review and evaluate the effectiveness of the recruitment process, making recommendations to the Board as necessary to improve the process for the following recruitment cycle.