We Ask CEDIA’s Chairman About Members Rights

cedia logoWe asked for and participated in a telephone interview with CEDIA Chairman of the Board Dennis Erskine and Senior Director of Marketing Cris Pyle in late May to discuss several topics swirling around the organization. First and foremost, we were seeking greater insight into the departure of CEDIA’s CEO Vin Bruno, as well as Ron Fleming and others, but we also discussed a few other topics – notably what rights members have, and what rights they don’t have.

See what the CEDIA executives told us…

Apparently anticipating our line of questioning, Cris Pyle began our interview by saying that in order to “level-set the conversation,” they “still cannot comment on any HR (human resources) issues.” I informed them I would ask the questions anyway and they can answer with whatever they feel is appropriate.

True to form, when we asked what the organization’s board had to say to their members about the management shake-up, given the fact that two of their top five executives, and 18% of their headquarters staff, have departed the association in what seemed to be unprecedented turmoil.

“We cannot discuss that and any discussion whatsoever that we have, positive or negative, subjects this association to legal liability and I’m not going there for that reason,” Erskine said sternly.

A Firm ‘No Comment’ on ‘HR’ Issues

When we suggested we were not looking for comments on personal traits or confidential specifics on the work performance of the individual departed executives, but rather sought more overview discussion from the association about why this collective change was taking place, what the board was doing about it, and what this meant for the organization going forward.

Erskine cut us off, “No, no, no – we have competent legal counsel and we are not going to put this association at risk.”

That was that on the topic of staff and management turmoil.Photo of CEDIA16 show floor

Separately, we had previously reached out to former CEDIA CEO Vin Bruno who also declined to address the matter, referring us instead to Erskine for comment – but Erskine is not commenting apparently on the advice of legal counsel.

However, the Association has previously announced that current COO Tabatha O’Connor would also act as a temporary CEO while the Board conducted a search for a new CEO. And the organization is currently in a year-long process to develop a new strategic plan with an outside London-based consultant.

Members Cannot See Financials, But Can See IRS Filings

Changing topics, we turned to the matter of reviewing some of the rights members enjoyed for their support of the organization. We specifically asked whether members have a right to see or otherwise review the organization’s financials.

“The only legal requirement under law is that we publish the 990 [an IRS form that non-profit organizations must file with the IRS],” Erskine responded, adding that there are no requirements to show financial information or budgets to members. As far as we know, and we’ve asked many, most members have never seen an IRS 990 form from the organization.

In addition to this, Erskine mentioned that certain financial information is shared with members during an annual members webinar – the last one of which was held in September 2016. However, the chairman told us, the financial information shared there is “high-level” and not very detailed.

But we’ve been told many times by previous executives and administrations that members who want to see the Association’s financials, can see them. So, we persisted, asking Erskine again – members are not allowed to see the organization’s financials?

“No…not to my knowledge,” Erskine told us. “If they have, then it’s been the annual summary that we cover in the webinar nowadays,” adding, “And you can check local law on that.”

Members Can Audit Board of Directors Meetings

Photo of Dennis ErskineTurning to another topic, we reminded the chairman of a previous conversation, where he had told us that CEDIA members have the right to attend board of directors meetings. Although we’ve been following the organization for years, we were completely unaware of this fact. And we suspect that many members are unaware that they possess this right as well.

We scanned the CEDIA website to see where this opportunity is mentioned and were unsuccessful in finding it. Yes, we found a listing of the many benefits of membership, but no section where the members rights are specifically mentioned – including this one. So we asked if the Association publishes the dates and locations of the board meetings so that members can plan on attending if they would like. In fact, CEDIA does not publish this information.

However, if any CEDIA member would like to attend one of the board meetings, you can contact CEDIA and they will give you all of the details. Erskine told us members can attend – but they cannot participate – so you’re really just auditing the meeting.

Locations Remain Secret, For Security Purposes

Currently, there are two board meetings scheduled – June 27 and November 11-12.  We’d like to tell you where these meetings are being held, we actually know their respective locations. But Erskine has asked us not to reveal the locations, “…for security purposes.”

Surprised by his comment, we asked Erskine if they’ve had security problems at past directors meetings and therefore have to be abnormally secretive. Erskine replied in an email, “It’s called risk management in this day and age.” Hmmmm….

We have further asked the organization to reconsider keeping the board meeting locations confidential and allowing us to publish the information, but did not hear back from them by the time this story was posted.

Can’t Attend the Whole Board Meeting

Erskine also informed us that while members can attend the board meetings, these meetings include an “executive session” in which “nobody other than the board is allowed to be in the room at the time.” In other words, members can attend the board meeting, just not the whole board meeting. Why?Photo of crowd from CEDIA

“Because we are talking about things either personnel related, or items that are under non-disclosure with third parties that we can’t have out until the NDAs are released,” Erskine explained. “There are no actions that can be taken during executive session.”

Separate from the board of directors is the executive committee, which according to newly minted Bylaws adopted at the beginning of 2017, is comprised of the “Chairperson, Chairperson-Elect, Secretary, and Treasurer of the Association.” So that means in the current situation, Dennis Erskine (Chairperson), David Humphries (Chairperson-Elect), Omar Hikal (Secretary), and Giles Sutton (Treasurer) make up the executive committee. The Executive Committee also holds meetings separate from the board, but according to Erskine, members have no right to participate in those.

The Three Main Rights of CEDIA Members

So to sum up, according to our discussion with the board chairman, members have three basic rights: 1) to receive an annual 990 filing (IRS rules mandate that these forms are public information, but they are hard to find); 2) to view a portion of a board of directors meeting; 3) to elect a board of directors to represent their interests.

We hasten to add that readers should not confuse these rights as identified in the previous paragraph with the many benefits of becoming a CEDIA member. The topic of members benefits is a completely different matter altogether. What this article contemplates is what rights members have in terms of control of the organization…a completely different topic…but one brought to the forefront as the Association faces a key turning point that will have a material impact on its future.

About Ted

A sales and marketing specialist - primarily in the technology industry - I've experienced a sort of "circle of life" in business. I've been a mass merchant retailer, a specialty retailer, a specialty manufacturer, a large volume manufacturer, a distributor, and even represented sales representatives. Now the owner of a marketing company that works with a variety of businesses on improving their strategic marketing and business development - I analyze issues from all angles to develop holistic solutions.

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