The board of directors have three primary legal duties known as the “duty of care,” “duty of loyalty,” and “duty of obedience.” Most states include these duties in the laws governing corporations, including not-for-profit organizations like your CIL or SILC.
These are duties that the board member must take seriously. When you agree to serve on a board you are agreeing to support your organization. If you can’t support them, you need to resign as a board member and advocate in other ways for what you think is right. As long as you have accepted the role of a member of the board of a SILC or a CIL, you have these three duties.
Duty of care: You have an obligation, as a board member, to assure the care of the organization and those it serves by assuring that legal and financial obligations are met by the organization, and that risks to those served and the organization are minimized. Typically, exercising this duty includes being responsible for the fiscal soundness of the organization, assuring that services are offered in an ethical manner and that no harm comes to those served, and assuring policies, practices and values which assure that others are not hurt by the actions of the organization. (This may include a responsibility to adequately insure the organization, its people and its property.)
Duty of loyalty: The board member’s loyalty must first be to the organization, ahead of the member’s own personal financial interests or other self-interest. As part of this, any actual or perceived conflict of interest must be revealed to the board, and the member with the conflict must abstain from voting on the matter. Best practice is that the member will also abstain from the discussion of the matter, unless all persons with an interest in the matter are speaking to the board.
Duty of obedience: The board member’s actions as a member must be consistent with the mission, vision, philosophy and goals of the organization. The board member must not act in a way that is inconsistent with the central goals of the organization.
But what can be done when an entire CIL Board neglects or refuses to acknowledge these duties? Honest question.
I think the first step is to make sure they really know what their duties are. I find that too often they are clueless — thus this post and a flow of training to help them understand, if they will listen.
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