Board Meetings (2A) STANDARD: The governing board meets at least three times per fiscal year with a quorum present, and maintains written minutes of each meeting.
The governing board is one of the most important elements of a well-functioning nonprofit organization. The board sets the strategic agenda for the organization and has overall responsibility for its mission and programs. The board should operate in a way that does not jeopardize clear and responsible decision-making.
Conflict of Interest Policy (2B) STANDARD: The organization addresses director, officer, and key staff conflicts of interest pursuant to a written policy that prohibits the interested party from approving or voting on the conflicted transaction and requires full disclosure of all material facts to the appropriate decision makers.
A well-managed nonprofit organization should have a policy that addresses conflicts of interest of its directors, officers and key staff. Conflict of interest policies help to ensure that no person benefits inappropriately from any transactions in which the organization is involved.
Board Compensation (2C) STANDARD: Board members receive no compensation for board service other than reimbursement of expenses incurred as a result of board participation.
Charity board members’ voluntary service is a deeply rooted tradition in the nonprofit sector. Most donors and nonprofit organizations expect that board members serve without compensation.
Board/Staff Positions (2D) STANDARD: Not more than one member of the governing board is a paid staff person of the organization; no paid staff person serves as board chair or treasurer.
The staff of a nonprofit organization is accountable to the governing board. Therefore, when paid staff members also serve on the governing board or as board chair or treasurer, the ability of the board and such officers to act independently is compromised.
Board Term Limits (2D) STANDARD: No elected member of the governing board serves for more than five years without standing for re-election.
Limits on board terms help to ensure that the board is accountable. Changes in board membership also allow for greater participation by the community being served.
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