The Director's Dozen: Prudent Activities for Governing Boards of Nonprofit Corporations


Directors of nonprofit corporations owe fiduciary obligations to the corporation. They are bound by Massachusetts law to perform their duties as directors in good faith, in a manner reasonably believed to be in the best interests of the corporation, and with such care as an ordinarily prudent person in a similar position would exercise under similar circumstances. As stewards of the nonprofit corporation, directors are required (1) to act with care in their oversight and, (2) to keep the interests of the corporation paramount above their own personal interests when acting for, or on behalf of the corporation. These legal duties are known as the duty of care and the duty of loyalty.

The following guidelines describe some actions directors should take to fulfill their legal duties...

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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