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The Reorganization at Tartu College 2013 - 2015

Foto: Taavi Tamtik (2015)Foto: Taavi Tamtik (2015)
For the past two years, Tartu College and its two sister organizations - the Estonian Studies Centre(ESC) and the Chair of Estonian Studies Foundation(CESF) - have undergone a major change in their governance structure. The reasons for this undertaking are important: the need for improving governance of the existing three legal entities, to have a proactive approach in becoming legally compliant with impending legislation for Ontario's Not-for-Profit Corporations (by updating the Corporation's By-laws), modernizing its Letters Patent Objects (a Corporation's official reasons for existing), and rethinking how the 3 organizations operate and coordinate their activities. The challenge was not only to ensure that Tartu College,ESC and CESF were legally compliant with the new impending rules, but that they were also aligned with their own strategic objectives. Since Tartu College financially supports the ESC and the CESF, this alignment was of critical importance. To lead this effort, special Committees were established, Reorg I (in 2013 to restructure Tartu College) and Reorg II (in 2014 to restructure the ESC and CESF). The legal firm of Miller Thomson, with a specialty in Not-for-Profit Corporations, was hired to provide legal assistance to these Reorg Committees, and the Board of Directors for each organization was required to approve the final changes brought forward by the Reorg Committees. The final step in the process was in receiving approval of these changes by the Members at each organization's Annual Meeting. Tartu College received approval in 2014 with the ESC and the CESF receiving their approval in 2015.

There are some fundamental principles and common practices that pertain to all 3 organizations:
  • all Directors that sit on their respective Boards are volunteers, with no one being reimbursed for their service; this rule prevents any potential conflict of interest with Directors and any compensation that they could receive; Management may attend Board meetings but they have no voting privileges
  • each Director is elected for a term of 3 years, and can only serve for three terms; after 9 years they must retire from the Board for a minimum of 1 year
  • only the Members can approve the Auditor of the Corporation, elect the Directors to the Board and approve changes to the Corporation's by-laws (as per legislation);

[An example for Tartu College. An important distinction to note is between members (all of the members belonging to a Korporatsioon or Selts) and the legal term Members (a Korporatsioon or Selts appoints 1 or 2 Members to represent them at the Annual Meeting)]

Tartu College (a Not-for-Profit Corporation of Ontario, without share capital; est. in 1968)

Tartu College's Letters Patent Objects were written and had not been changed since1968. Its by-laws were written at the same time and numerous by-law amendments had been made over time, and were deemed by our lawyers not to be compliant with current practices. Tartu College's key mandate has been to promote, preserve and increase the knowledge of the Estonian experience in Canada and its longevity can be attributed to its successful model of running a student residence, with its cash flow surpluses permitting not only investments in the building but also to advance Estonian studies in support of its Estonian focussed mandate.

A key decision made early on by the Reorg I Committee was to have Tartu College's main objective be the prudent management of its key asset - the Tartu College building and any potential building development. It retained its objective of promoting Estonian programs and

studies but will financially support these endeavors by outsourcing the management of these activities to the ESC and CESF.

Since major changes were planned for the governance of Tartu College, it was felt that it was important to be transparent during this reorganizational process. Three public meetings were held to discuss all of the key aspects of the changes, request input from its member organizations on key issues, and explain the reasons for the changes being made. These meetings paved the way for a smooth final approval at its Annual Meeting.

Tartu College's Board of Directors had consisted of 27 Directors representing 26 organizations. This was deemed to be an unmanageable number for proper governance and the final number of Directors was reduced to 11. In addition, the ownership structure for Tartu College was clarified with only the academic organizations (Korporatsioonid and Seltsid) becoming legal owners and now referred to as Participating Organizations. The responsibility of the Participating Organizations is to nominate the 26 Members that elect 9 Directors to the Board and the By-law now requires that all of these 9 Directors be Members. The Participating Organizations are defined as two types, ones with more than 25 members (who are allowed to nominate 2 Members) and the others with less than 25 members (nominate 1 Member). During this restructuring process ÜS Räimla was added as a Participating Organization.

The ESC nominates 2 Directors to the Tartu Board to arrive at the full complement of 11 Directors. (The intent of having 2 Directors from the ESC sit on the Tartu Board is to ensure that there is effective communication between Tartu and the ESC on matters of mutual interest; These 2 Directors also become Members of Tartu College.)

The remaining Estonian organizations that were under the Tartu College umbrella have been moved to the Estonian Studies Centre. The one exception is that Eesti Elu remains currently as part of Tartu College.

In April of 2014, the existing Board of Directors voted their approval of the Reorg I Committee's recommendations and in May of 2014, at Tartu College's Annual Meeting, the recommendations were approved and the revised Letters Patent Objects, and the new By-law was accepted as the new governing documents for Tartu College.

In summary, Tartu College's ownership structure was clarified, its Letters Patent Objects and its By-law were updated and made legally compliant to the existing and impending NFP legislation, its mandate was made more focussed and most importantly its governance framework was modified and strengthened.

The Estonian Studies Centre (a Registered Charity of Ontario; established in 2008)

A Registered Charity in the Province of Ontario is required to operate for the "public good" and the need to have "a charitable purpose". Registered Charities have recently attracted increasing Canada Revenue Agency and legal scrutiny resulting in more attention being paid to this sector. Since the Board of Directors has the ultimate responsibility for its operations, proper governance and especially accountability of its funding processes are mandatory to the proper functioning of any Registered Charity.

The ESC Reorg II Committee began its work in the fall of 2014 with their scope of work to provide a proper governing structure for its activities. An important early decision was to use the Tartu College By-laws as a template for the By-laws of the ESC and CESF. It was felt that a familiarity of By-laws between the three organizations would lessen the confusion on the understanding of these important documents. The important differences amongst the three sister organizations are how Members are selected, which organizations can elect Members, how many Directors sit on the Board, and the qualifications for its Directors. In summary, the three organizations have chosen different methods for choosing its governing Board of Directors.

The ESC is currently made up of 10 Operating Programs (See Appendix C) that compose the ESC. An 11th Operating Program is expected in 2016 when the EstDocs Operating Program intends to join. Each ESC Operating Program nominates or elects 2 Members to its own Operating Committee, and all 10 of the ESC's Operating Committees have the responsibility to elect Directors to the ESC Board of Directors at the ESC's Annual Meeting.

The ESC's Board consists of 9 Directors. Five Directors must be appointed by the Members of its Operating Committees (and must be Members), two Directors are appointed from Tartu College and two are outside independent Directors who must also be approved by the Members. The Operating Committee Members attend the ESC's Annual Meeting to perform these duties.

Each Operating Program at the ESC is required to i) have their bookkeeping audited on an annual basis by the ESC auditor, ii) have an annual operational review with the ESC Board, and iii) provide their input to the ESC annual budget process should they require funding. Failure to adhere to these requirements will result in that Operating Program's dismissal from the ESC. The approval and oversight of funding for the Operating Programs and for external programs will be a critical management issue for the ESC's Board.

The benefits accruing to ESC Operating Programs are significant. Operating Programs will be legally incorporated, funds that would be donated to that organization would be tax deductible (the funds would be payable to the ESC, with a specific designation to the Operating Program), funding will have a formal, legal basis and the Operating Committees will have greater input into the overall direction of the ESC.

In summary then, the ESC will have its Members chosen from the Operating Programs (via Operating Committees), who in turn have the responsibility of electing the Directors to the Board, approving the ESC's Auditor and having sole approval of any By-law changes. The Board of Directors will have the ultimate responsibility for all of the activities of the ESC's Operating Programs, including its funding support.

The Chair of Estonian Studies Foundation (A Registered Charity and Trust of Ontario; established in 1982)

The CESF was instrumental in establishing the Elmar Tampõld Chair of Estonian Studies at the University of Toronto. The Foundation and Tartu College were key elements in raising the money to establish this Chair in perpetuity at the University. Its mandate is to act and support other academic institutions and scholars to promote Estonian knowledge and research.

The CESF Reorg II Committee had the least amount of work of the three committees. It reviewed the Foundation's Letters Patent Objects, the template By-law of Tartu College and other workings and made minimal changes. The existing Directors are the Members of the Corporation and they decide who they will elect to the Board of Directors. In choosing candidates, the Board will consider the need for representation from Tartu College, the ESC, academia and the general community at large. At the Board's discretion, the number of Directors can vary from 5 to 11.

Summary

The reorganization at Tartu College, along with its two sister organizations, the Estonian Studies Centre and the Chair of Estonian Studies, is now complete. The challenge ahead, now that that a reorganization has taken place with an improved governance structure and new responsibilities, is to continue the legacy, 45 years in the making, of advancing Estonian Studies in the Canadian context.

by Jaan Meri who is the current Chair, Board of Directors of Tartu College; Chair, Board of Directors of the Estonian Studies Centre; and a Director of the Chair of Estonian Studies Foundation.

  • Reorg I Committee(Tartu College): Helge Kurm, Toomas Marley, Jaan Meri, Tõnu Tõsine
  • Reorg II Committee(ESC): Asta Lokk, Toomas Marley, Jaan Meri, Kaja Telmet
  • Reorg II Committee (CESF): Peeter Einola, Toomas Marley, Jaan Meri

Appendix A - A comparison of the Governing StructuresAppendix A - A comparison of the Governing Structures

Appendix B - Participating Organizations at Tartu CollegeAppendix B - Participating Organizations at Tartu College

Appendix C - Operating Programs at Estonian Studies CentreAppendix C - Operating Programs at Estonian Studies Centre

Appendix D - Board of Directors 2014 - 15Appendix D - Board of Directors 2014 - 15

Appendix E - Letters Patent Objects

1. Tartu College

"The objects of the Corporation shall be as follows:

a) To construct, maintain and operate a building(s) for the Corporation to provide:
  • (i) dwelling and other accommodation for scholars and students at the University of Toronto and other post-secondary institutions of learning;
  • (ii) conference, meeting and other facilities to be used for seminars, lectures and correspondence courses particularly related to or attended by the Estonian community;
  • (iii) conferences, meetings and exhibitions for the discussion and exchange of views on culture, language, history, arts and science, particularly those of interest to the Estonian community;
  • (iv) space usage for museums, archives and libraries especially dedicated to preserving the history of the Estonian community in Canada; and
  • (v) such other activities consistent with the objects of the Corporation.

b) To establish and operate a Community Centre and community organization for the purpose of:
  • (i) providing facilities and services to the residents of Ontario who are of Estonian heritage;
  • (ii) preserving and promoting the traditions of Estonian-Canadians and the Estonian culture, language, history, arts and science;
  • (iii) sponsoring events for the promotion of Estonian culture, language, history, arts and science;
  • (iv) maintaining a centre for Estonian culture, language, history, arts and science; and

c) To establish, acquire and accumulate funds for scholarships, bursaries and grants for scholars, students, post-graduate students and institutions with similar Objects as the Corporation."

2. Estonian Studies Centre

"The objects of the Corporation shall be as follows:

  • a) To establish and operate resource libraries, archives, museums and provide opportunities for research and the collection and dissemination of knowledge regarding Estonian culture, language, history, arts and science.
  • b) To increase public knowledge and appreciation of the Estonian culture, language, history, arts and science.
  • c) To advance education by providing public access to events related to the Estonian culture, language, history, arts and science.
  • d) To advance the public's appreciation of the arts by promoting artistic works particularly those connected to Estonian culture, language, history, arts and science, and providing access to artists to exhibit, present and perform their works.
  • e)To receive and maintain a fund or funds to apply all or part of the principal and incometherefrom, from time to time, to registered charities under the Income Tax Act (Canada)."

3. Chair of Estonian Studies Foundation

"The objects of the Corporation shall be as follows:

  • a) To establish and maintain any Chair of Estonian Studies at any university in the Province of Ontario, provide for lectures, classes, seminars, meetings and conferences to advance Estonian Studies, receive and maintain any funds for the purpose of endowing any Chair of Estonian Studies at any university in the Province of Ontario and enter into such agreements as may be necessary for the payment to the university for all or part of any funds required.
  • b) To encourage and further academic excellence for the pursuit of Estonian Studies at any university in the Province of Ontario, through the provision of resources, scholarships, equipment, books, journals, and materials consistent with achievement of excellence in Estonian Studies."
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