All nonprofit board members must meet certain standards of conduct and attention in carrying out their responsibilities to the organization. These standards are usually described as the Duty of Care, the Duty of Loyalty, and the Duty of Obedience. A description of each is below:
- Duty of Care – The Duty of Care describes the level of competency expected of a board member. It is a level of “care that an ordinarily prudent person would exercise in a like position and under similar circumstances.” This means that a board member has a duty to exercise reasonable care when making a decision as a steward of the organization.
- Duty of Loyalty – The duty of loyalty is a standard of faithfulness; a board member must give undivided allegiance when making decisions affecting the organization. This means that a board member can never use information obtained as a member for personal gain, but must act in the best interests of the organization.
- Duty of Obedience – The duty of obedience requires board members to be faithful to the organization’s mission. They are not permitted to act in a way that is inconsistent with the central goals of the organization. A basis for this rule lies in the public’s trust that the organization will manage donated funds to advance the organization’s mission. This duty also requires board members to obey the law and the organization’s internal rules and regulations.