SELECTED 2024 DEVELOPMENTS IN NONPROFIT ORGANIZATIONS LAW AND NONPROFIT ORGANIZATIONS (NPO) COMMITTEE HIGHLIGHTS

Written by Steven Chiodini* and Joel S. Corwin**

KEY LEGISLATIVE DEVELOPMENTS

The NPO Committee is pleased to report that Assembly Bill No. 2908, a California legislative bill initiated by the committee and co-sponsored by the Corporations Committee, was signed into law by Governor Newsom on July 18, 2024. Assembly Bill No. 2908 removes the December 31, 2025 sunset date for Corporations Code provisions allowing non-emergency virtual meetings of members and shareholders.

Restrictions imposed on group and travel activity as a result of the COVID-19 pandemic revealed that certain provisions of the Corporations Code relating to the governance of California corporations had not kept up with technological advances, even in the absence of an emergency. Challenges in accessibility that arose also demonstrated that existing provisions that provided some flexibility to California corporations during an emergency did not adequately recognize the need for such flexibility outside the context of an emergency. As a result, the Corporations Code was revised to authorize California corporations to conduct nonemergency remote meetings of shareholders and members, as applicable, if the corporation implements reasonable measures to provide the shareholders and members a reasonable opportunity to participate and vote, among other conditions. However, these statutory provisions had a sunset date of December 31, 2025.