Volunteering for Non Profit Boards

| May 7, 2012

Volunteerism in itself is a commendable public service for it takes dedication and a selfless spirit to want to give of our precious time for the sake of helping others. Serving on a non-profit board can be personally and professionally rewarding, as well. This is why understanding and knowing the policies and mission of the board on which you serve is not only important, but essential because being informed will save you from future legal woes and liabilities.

Volunteering to become a member of the board of an organization makes you a member of that organization’s management team. There is the general assumption that serving on the board of a non-profit organization makes a person immune from legal liabilities, which is not the case. When you volunteer for a nonprofit board, you open yourself up to legal action against the organization. There is a standard of care imposed by various state statutes determining the amount of due diligence an organization must use in governing and running its business. Before you commit yourself to a worthy cause, you should make sure you know the following:

Know the Organization. Research and ask questions about the organization. What is its cause and mission? A complete understanding of what the non-profit does and intends to do in the future is something every board member should know. If you find that this information is unavailable and all attempts to seek out the information have failed, it is time to advise yourself whether or not you want to continue to be involved with the organization. Stating ignorance over the organization’s activities is insignificant in a court of law. It is also essential to know where the organization’s offices are located. Take a planned tour of the facility. Make an effort to meet with some of the volunteers and management of the organization to get a feel of the atmosphere.

Know the Organization’s Bylaws. Most organizations have a copy of their bylaws posted on their website. If the organization you are volunteering for does not have its bylaws easily accessible on its website, simply ask for and review a copy. The activities of the board and its members and the organization, should comply with the stated bylaws. If you are aware of the bylaws, you are a much more effective voice against malpractice, than just becoming a board member who goes along with every decision made whether or not such action complies with the organization’s bylaws.

Know the Organization’s Finances and Insurance Policy. Most board members are usually not aware that they can be covered under the organization’s Directors and Officers (D&O) liability insurance. When you offer your services as a member of a non-profit board, it is essential that every board member be covered under the policy to safeguard against future lawsuits against the organization. Board members must also be updated periodically (usually at the board’s scheduled board meetings) about the financial standing and activities of the organization. Any attempt by the organization to inflate or deflate its financial picture is a red flag and should be taken very seriously. Remember, the board is the governing base of any organization and effective corporate management begins here.

Attend Board Meetings. There is no way you will know what is going on within the organization if you do not attend meetings. Also note that not attending meetings does not excuse you from legal action. Relying on meeting minutes to stay informed is definitely not the way to go because being present paints a clearer picture for you and allows you the chance to be actively involved and to have your thoughts, agreements and disagreements documented for future reference. If you notice that you said something in a meeting that is not reflected on the minutes, you should take immediate steps to have that corrected.

Know the Time and Financial Expectations. You should always know in advance (preferably before you agree to sit on the board) what the time and financial expectations of the organization are. This is usually included in the letter inviting you to serve. If it’s not, request a copy of the organization’s bylaws. Everything you need to know should be included in this document. It is considered the governing document/rules/laws of any corporate entity, including non-profit organizations. Any deviation from the organization’s stated bylaws can be – and must be – questioned.

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