Whether you're stepping into board service for the first time or have years of experience, staying focused on these basics ensures you lead with purpose and confidence
In any meaningful endeavor, fundamentals keep us grounded and moving in the right direction. For nonprofit boards, these fundamentals are the guiding principles that ensure your organization stays true to its mission and serves its community with integrity and impact. At the heart of effective board governance are three core fiduciary duties: care, loyalty, and obedience. These duties aren’t just legal obligations—they’re the foundation of responsible, ethical leadership. By understanding and embracing these principles, you help create an environment where your nonprofit can flourish, grow, inspire trust, and make a lasting difference. Whether you’re stepping into board service for the first time or have years of experience, staying focused on these basics ensures you lead with purpose and confidence. Let’s dive into how these essential duties form the backbone of strong, mission-driven governance.
Duty of Care
Board members must act with the care that an ordinarily prudent person would take in a similar position and under similar circumstances. This includes staying informed about the organization’s activities, actively participating in decision-making, and making decisions in good faith for the organization’s benefit.
A board culture that nurtures curiosity, and ongoing engagement, and provides space for questions and respectful disagreement is key to practicing the duty of care. As boards of faith-based nonprofits, it is fitting to consider how faith-inspired values and principles play into what the duty of care looks like for your organization.
From a practical perspective, the duty of care means coming prepared to board meetings, actively engaging in the meeting, speaking up when something doesn’t feel right, and investing time, as needed, to understand items such as financial reports, key performance indicators, and the organization’s mission and vision.
Duty of Loyalty
Board members must prioritize the organization’s interests over personal or other interests. This means avoiding conflicts of interest and ensuring that any decision made serves the organization’s best interest.
The first step is signing a Conflict-of-Interest statement each year, disclosing any conflicts. Transparency is the key both with the organization and in one’s self-reflection. For those who become quite invested in a nonprofit, it can become challenging to distinguish between what is best for the organization and what one’s personal hopes may be. From a practical perspective, this may also include prioritizing the organization when you plan your charitable contributions. It also will likely involve the gift of your time for things like participating in events or meeting residents. While much of board work can be a joy, there can also be times of crisis. The duty of loyalty calls each board member to provide leadership during these times.
Duty of Obedience
Board members must ensure that the organization complies with applicable laws, regulations, and its governing documents (such as bylaws). They are also responsible for ensuring that the organization adheres to its mission and purpose.
Foundational to the fulfillment of this duty is the development of knowledge about the organization and understanding of the applicable laws, regulations, and organizational governing documents. The Governance or Executive Committee can help with this by identifying gaps in understanding and planning training for the entire board or individuals and by creating a robust onboarding plan for each new board member.
In nonprofit leadership, mastering the fundamental duties of care, loyalty, and obedience is essential for success. Just as a strong foundation supports a well-built house, understanding and embracing the core principles of board governance can support your organization to thrive and fulfill its mission. Through these duties, board members can find greater satisfaction and meaning in their service.