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Things to Know About Nonprofit Board of Directors

by Sam Ashe-Edmunds, studioD

Serving on a nonprofit board of directors can boost your professional profile and provide management experience to help you succeed at the highest levels of business. It can also damage your reputation and land you in legal hot water if things go wrong. Before you join a charity, foundation or trade association as an officer, know the duties, benefits, and ups and downs of being part of a board of directors.

Boards of Directors

A board of directors of a nonprofit is responsible for ensuring that the organization meets its stated mission and goals. At small organizations, board members may do the hands-on work of managing accounting, marketing, fundraising, event planning and all other business operations. At large nonprofits, the board hires a business manager, known as an executive director or chief executive officer, and guides the director's management of the organization. These board members primarily provide their expertise in setting the strategic agenda of the organization.

Roles and Responsibilities

Board members typically attend meetings, discuss issues of importance to the organization; vote on these issues; oversee committees; work with the executive director and staff on their committee assignments; and help raise funds. Some hold titles, such as secretary, treasurer, vice chair and chairman. The chairman, who sometimes takes the title of president, runs board meetings and represents the organization in public. One of the key responsibilities of board members is to understand the organization’s financial position and take steps to manage it effectively.

Legal Exposure

Board members must exercise reasonable care in their operation of the organization. For example, while individual board members do not need to see detailed monthly financial statements, they must appoint a credible person to oversee the organization’s finances and deliver regular reports on the nonprofit's performance. This is often a treasurer who handles the books personally or oversees a financial manager or accountant. Board members get a treasurer’s report at each official board meeting. Boards often purchase a general liability insurance policy to help pay for lawsuits aimed at the association, and a director’s and officer’s liability insurance policy to help defend against lawsuits charging officers with wrongdoing. This insurance does not protect board members in the event of fraud, carelessness or gross negligence. For example, if you never see any financial reports during your tenure as a board member and don’t ask to see any, you haven’t exercised reasonable care in your duties. If your accountant steals the association’s money, you and your fellow officers might be held personally liable for repaying the funds.

Getting on a Board

To serve on a board of directors of a nonprofit, visit the organization's website to determine whether it has instructions for volunteering. Small nonprofits are often glad to have volunteer board members, even those with no experience. If it’s more difficult to get on a board, work your way up to a position. Start by joining the association, volunteering at events, attending its functions, writing for its newsletter, then serving on a committee. Once you know how the committee operates, offer to serve as its chair. Let a board member know you are interested in becoming a board member and you might be invited to interview for an open position.

About the Author

Sam Ashe-Edmunds has been writing and lecturing for decades. He has worked in the corporate and nonprofit arenas as a C-Suite executive, serving on several nonprofit boards. He is an internationally traveled sport science writer and lecturer. He has been published in print publications such as Entrepreneur, Tennis, SI for Kids, Chicago Tribune, Sacramento Bee, and on websites such Smart-Healthy-Living.net, SmartyCents and Youthletic. Edmunds has a bachelor's degree in journalism.

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