1. INK 25: 10 Things to Know About Being a NFP Board Member

2. {01} Not For Profit Organizations
Most Rotary clubs are incorporated as “Not for Profit” (NFP) organizations
This status has some legal advantages, but also involves responsibilities to the law
These responsibilities sit alongside our Rotary Obligations

3. {02} Role of the NFP Board
Makes decisions about strategic directions, goals and activities of the organization
Monitors the performance of the organization in relation to its goals
Oversees Risk Management
Oversees the financial sustainability of the club
Makes decisions about disciplinary actions
Reports to members
Ensures the organization operates within the law

4. {03} Role of Each NFP Board Member
Understand the business of the club
Attend Board meetings
Be active in the organization e.g. attend events
Attend the Annual General Meeting
Provide advice to inform Board decisions
Declare actual or perceived conflict of interest
Govern & oversee the club’s operations

5. {04} Board Role C/F Other Roles
Board member role is strategic
Has to do with Governing the Club
NOT the management or operations
Projects and activities are run by committees, chairs and co-ordinators - NOT the Board
Board NOT involved in day to day running of the club – but it delegates authority to Chairs

6. {05} 4 Legal Obligations of NFP Board Members - Obligation 1
1. Duty to Act in Good Faith and For Proper Purposes
Act honestly, fairly and loyally
Put interests of club first – above self interest
Only act for proper purposes i.e. to benefit the organization
Be familiar with the Club Constitution

7. {06} 4 Legal Obligations of NFP Board Members – Obligation 2
2. Duty to Act with Care, Skill and Diligence
Monitor and make decisions about strategic direction of club
Be serious – give the role sufficient time, thought and energy
Use your specialized skills to assist the Club
Be diligent: keep up to date on developments, ask for more information when required, make your own independent decisions after hearing experts

8. {07} 4 Legal Obligations of NFP Board Members – Obligation 3
3. Duty not to dishonestly use your position or information
Board members have a position of power and trust and access to confidential information
Board members must not use their position to gain advantage for themselves
Every decision must benefit the club
The position cannot be used to benefit yourself or to in any way harm the club.

9. {08} 4 Legal Obligations of NFP Board Members – Obligation 4
4. Duty to avoid conflicts of interest
Conflicts of interest are common – having one is not the problem
The problem arises when the Board member prefers their own interests (or family interests) above the interests of the club
ALL Conflicts of interest must be disclosed as soon as you are aware of them – the Club Board must then decide whether you can continue in the decision making process

10. {09} Liability of Board Members
Board members are typically NOT personally liable (i.e. legally responsible) for the debts or consequences of the organization
Personal liability MAY apply when:
a Board member doesn’t take reasonable care to minimize risk of harm
A member knew or is reckless about and could have prevented contravening of environment laws

11. {10} More Information www.nfplaw.org.au (Not for Profit law resources)
(Australian Charities and Not For profits Commission)
Associations Incorporation Act 1964, 1981, 1985, 1991, 2001, 2009, 2012, 2015,)
A Document with all this information and more will be sent to all Board members

12. Thank You