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MFAA members will directly elect their board under new rules, although the board itself will choose Phil Naylor’s replacement.
The MFAA announced yesterday that its lawyers are working on changes to the constitution that would allow all of the association’s 10,000-plus members to elect directors.
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Under the new rules, members would directly elect five directors, at least four of whom would have to be loan writers or representatives of brokerages or mortgage managers.
The board would also be able to appoint its own directors, provided that loan writers or representatives of brokerages or mortgage managers remained in the majority.
This will replace the current system whereby directors come to the board automatically, either as a result of them being a state president or chair of a national committee.
Members will vote on the constitutional changes at an extraordinary general meeting in late September.
Chief executive Phil Naylor said the board had been discussing the idea of direct elections for several years in response to broker feedback.
“It’s very important for member engagement that those who are the majority of the organisation have control over its affairs,” he told The Adviser.
Mr Naylor added that the board would decide on his successor and would also control the appointment of future chief executives.
“It’s normal practice for the board of any organisation to appoint the chief executive,” he said.
The MFAA announcement has generated a positive response from industry figures, including AFG’s general manager of sales and operations, Mark Hewitt.
“It looks like a positive change. A broker majority should ensure focus on issues relevant to the membership,” he said.
Home Loans Adelaide principal Vincent Woodall said the new rules would probably make future boards more accountable to brokers.
“It seems like an excellent idea because then the board members will hopefully have empathy with brokers and what they have to put up with,” he said.
“Are they there purely to punish errant brokers or to make life easier for brokers?”
Keypoint Financial Services director Bedron Moses also said the reforms sounded good in principle.
However, he told The Adviser it would be important to make sure that smaller brokers were protected and that big groups didn’t work to get elected so they could favour their own interests.
“For us as brokers, it’s never been about who was on the board of the MFAA. The biggest issue has been that the MFAA provides a single voice for brokers, especially in relation to the lenders,” he said.
