Nonprofit Board Member Checklist
Checklist

Nonprofit Board Member Checklist

by Jennifer Vacha
June 21, 2023

Board service is a wonderful way to get involved in an important cause, but it also comes with a great deal of responsibility. This checklist provides potential and current nonprofit board members with an overview of considerations before and after joining a board, as well as common practical and fiduciary duties.

Before you join a board, consider, and review the following:

  • Articles of incorporation and bylaws
  • Prior year’s Form 990 via www.GuideStar.org
  • Is the most recent Form 990 corroborated by the applicable annual report?
  • Current budget
  • Three years of prior reviewed/audited financial statements
  • Written list of board duties and meeting dates: How many are you expected to attend? Is there a board orientation or training? How many committees are you expected to serve on? How often do committees meet?
  • Conflict of interest policy: How is it used?
  • Why were you asked to join the board? Why do you want to join? Do you have specific expertise, fundraising ability or other talents that make you an attractive board member?
  • List of current board members and their affiliations: Is the board diverse? Contact several — are they actively engaged? Do they have an open, strong working relationship with management?
  • Current staff organizational chart
  • Current strategic plan
  • How does the organization fund operations (e.g., grants, donations, fee for service, membership dues)?
  • How does the organization manage reserves? If there is an endowment, review the recent investment returns and investment policies.
  • Board indemnification policy, D&O policy coverage and limits, and other insurance policies that cover the organization and volunteers
  • Was an annual risk assessment performed? Is there adequate insurance coverage based on the assessment? Are policies in place to ensure timely claims? Was director coverage reviewed and shared with the board?
  • Were there lawsuits or other liabilities incurred during the year? How did the board learn of the issue(s)? Were fundraisers evaluated for effective operation within ethical standards?
  • Is there a strong nominating committee with a process designed to recruit the most effective board members? Did it meet and nominate new directors successfully?

After you join a board, annually consider the board’s involvement:

  • Were internal financial statements available in a timely manner? Were they reviewed and approved?
  • Was an audit or review performed? Did the board review the results? Any exceptions noted on the management letter?
  • Were all tax returns filed with the IRS (Form 990, employment, etc.)? Were copies and other state filings remitted to state agencies as needed?
  • Is the organization operating within its current budget and within the resources available?
  • Has the board reviewed the organization’s financial policies, investment management policies, gift acceptance policies and donor data policies?
  • Were endowment investment returns reviewed and compared to investment policy guidelines?
  • Have all board members signed the conflict of interest policy statement agreeing to put the interests of the organization above personal interests and reveal any conflicts (perceived or actual) in matters put before the board?
  • Is there a current strategic plan? If not, are there plans to engage in the process?
  • Was the CEO’s performance evaluated and documented in writing? If material issues or questions arose were these shared with the board?
  • Is the board satisfied with staff performance? Were executive salaries reviewed and compared to similar nonprofits? Were statistics shared regarding the organization’s performance in serving the public (e.g., the number of individuals served or other measures of programmatic effectiveness)?

Personal annual evaluation — did you:

  • Attend the annual workshop or training session?
  • Attend at least 80% of the scheduled board meetings?
  • Review minutes from meetings you attended to ensure board actions were correctly reflected?
  • Review minutes from meetings you did not attend to learn actions taken in your absence?
  • Participate in key decisions made by the board? (Did you ask questions, listen to the opinion of others, vote only when you had facts and the professional input needed to make a decision, etc.)
  • Review the audited financial statements? Were they timely prepared? Did you review the management letter and address all items raised as a concern?

Common law duties for board members:

  • Duty of care — Participate in governance and provide operational oversight
    • Act in good faith and in a prudent manner, and keeping the best interests of the organization top of mind
  • Duty of loyalty — Participate but only if you can stay true to the organization
    • Avoid acting where there is a conflict of interest and disclose any actual or potential conflicts of interest, protect members’ confidentiality, and act in the interest of the organization rather than your own personal interests
  • Duty of obedience — Participate to ensure the organization’s mission is carried out
    • Provide oversight and guidance and maintain compliance with applicable laws

Practical duties for board members:

  • Establish a mission and purpose
  • Select a CEO and capable management
    • Provide support and evaluation
  • Ensure effective planning
  • Monitor and strengthen programs and services
  • Ensure adequate financial resources via fundraising efforts
  • Manage and protect assets
    • Provide financial oversight
  • Build and perpetuate a competent board
  • Ensure legal and ethical integrity
  • Represent the organization to the public
    • Enhance public opinion of the organization

Looking for Ways to Better Fulfill Your Nonprofit’s Mission?

It’s often the case that nonprofits are bogged down by operational challenges that take time away from serving their communities. Contact our Nonprofit Accounting and Consulting experts today to learn how we can help your organization overcome core challenges — so you can spend more time achieving your mission.

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