We all want to help our community, but before accepting a position on a nonprofit's board of directors, make sure you understand your legal responsibilities and duties. We work alongside nonprofits as legal counsel, but have served on boards ourselves. It can be really confusing when you join a board if you've never been on one (or been educated on how one operates) before.

Here are some things to consider before joining a Louisiana nonprofit board of directors.

Who Do You Represent?

As a Board member, you represent the best interests of the nonprofit. You have what is called a fiduciary duty to the organization. It's your job to act (and vote) in its best interest.

Can A Board Member of a Nonprofit Be Sued?

Yes. Remember that anyone can file a lawsuit. It's a totally different thing than the person winning the lawsuit and getting a judgment against a board member. A person can win a lawsuit against a board member if they can prove:

• The board member did not act in good faith in their vote or actions. This is hard to prove, but it can be done.
• The board member intentionally chose to hurt or harm another person.
• The board member is active in governing an agreement where they have a personal or financial interest in it.
• The board member approved of criminal actions by the nonprofit.

How Can You Protect Yourself from Liability as a Board Member?

The best way to protect yourself if to know what your legal responsibilities are under Louisiana law and what the bylaws say your participation should be.

• Ask for board member onboarding and training (pssstt, we do that!)
• Have a signed Director Agreement, which lays out policies and procedures to go hand-in-hand with the bylaws.
• Make sure the nonprofit has insurance: director and officer, general liability, and professional liability insurance. That way if the organization, or you as a director, are sued, then the policy can pay any judgment.
• Read all the bylaws, minutes, agendas, emails, and resolutions sent to you. The bylaws will govern your behavior and the actions of the nonprofit.
• Make sure the bylaws have an indemnification clause for board members.
• Disclose any and all potential conflicts of interest with the Board in writing AND do not vote on that matter.
• Attend all meetings or read the meeting minutes after so you know what is happening with the group.
• Vote "no" if you do not agree to a "yes" vote on a matter. If you object to a vote or vote "no", once it passes consider having your reason against the vote on the record.
• Do not keep nonprofit funds for yourself. I know that's a no-brainer, but here we are.
• Make sure the organization keeps up to date with their filings- annual reports and IRS forms.

‍

Need Help with a Louisiana or Mississippi Nonprofit?

Need help setting up a nonprofit, scheduling board member onboarding training, getting bylaws, or reviewing your bylaws or Director Agreement? Get started with a paid consultation with Amber & Tubbs.

You can email our assistant Brielle to schedule a paid consultation and start a conversation through text or call at 985-265-7069. You can also contact us with easy online scheduling here.

‍

Want More Amber & Tubbs? Please Follow Us Online:
Amber's FacebookTubbs' Facebook (yes you read that right)Our Instagram

Tubbs’ Instagram

‍

‍

Please note that this entire article, as everything else on this Sheppard Law website, is the intellectual property of Amber Sheppard and Sheppard Law. It should not be reproduced in any fashion without explicit written permission. This article was originally published October 23, 2023.

‍

‍