The council has promised to produce a green paper on reform, setting out proposals for improving community involvement in local government, and looking at options for establishing parish councils and local referendums.
Leader Albert Bore said: 'Birmingham needs to create a lively neighbourhood democracy and get more people involved in decisions about the public life of the city. The green paper will take us clearly in this direction and give everyone in the city a chance to contribute to our radical ideas.'
The reforms were among key recommendations of the city's democracy commission revealed by LGC (23 June).
Mr Bore faces competition from Stewart Stacey and Mick Rice.
The Conservatives accused Mr Bore and his group of kicking the mayoral issue into the long grass.
The motion agreed by the council says it is 'minded' to hold a
referendum and that it accepts the 'sense and spirit' of the commission's mayoral proposals.