What is a Casting Vote?

A casting vote is a special voting right given to the chairperson or a board’s presiding officer to break a tie when votes are evenly split. It is typically used only when a decision cannot be reached due to an equal number of votes for and against a motion.

This voting right is usually outlined in a company’s bylaws or corporate governance framework, so that decision-making is not stalled by deadlock. In many jurisdictions, the casting vote serves as a tiebreaker and can only be used when a quorum cannot reach a consensus.

Who holds the right to a casting vote on a board?

In a board setting, the right to a casting vote typically belongs to the chairperson or presiding officer. The ability to cast a vote is specified within the organization’s governing documents, such as its bylaws or articles of incorporation. 

The purpose of assigning the casting vote to the chairperson is to ensure impartiality and continuity in decision-making. The chairperson is expected to act in the best interest of the organization and remain neutral throughout discussions. However, not all grant a casting vote to their chair; the provision for such vote may vary according to the board’s voting protocols.

Are there any limitations to casting votes?

While casting vote is meant to facilitate decision-making, it does come with certain limitations:

• Risk of perceived bias: The casting vote could create a perception of bias, especially if the chairperson frequently uses it to side with one fraction of the board.
• Restrictive use cases: In some governance structures, the casting vote is only applicable in cases of a deadlock and cannot be used at the discretion of the chairperson on other decisions. 
• Potential for conflicts of interest: If the chairperson has a conflict of interest related to the matter of being voted on, using the casting vote could create legal and ethical issues. 
• Restricted scope of use: Some corporate governance laws restrict the casting vote to situations of absolute deadlock. The chairperson cannot use it arbitrarily or preemptively.
• Documentation and procedural requirements: A casting vote can only be used if detailed procedural steps are followed, including clear documentation in board minutes. Failure to follow such steps can nullify the vote’s validity.

How should a chairperson exercise their casting vote responsibly?

The chairperson must use their casting vote with careful consideration to maintain neutrality. Here are some guidelines for exercising the casting vote responsibly:

• Thoroughly evaluate the merits of each side’s argument to make an informed choice.
• If a tie arises, the chair must first try to reach consensus first and treat casting vote as a last resort.
• If a conflict of interest arises, the chair must disclose it and potentially recuse themselves from the decision. 
• Record the casting vote in the minutes, including the reasons behind the chair’s choice.