Nonprofits enjoy the public’s trust, and therefore must comply with a diverse array of legal and regulatory requirements. Organizations should conduct periodic reviews to address regulatory and fiduciary concerns. One of leadership’s fundamental responsibilities is to ensure that the organization governs and operates in an ethical and legal manner. Fostering exemplary conduct is one of the most effective means of developing internal and external trust as well as preventing misconduct. Moreover,[…]

Nonprofits enjoy the public’s trust, and therefore must comply with a diverse array of legal and regulatory requirements. Organizations should conduct periodic reviews to address regulatory and fiduciary concerns. One of leadership’s fundamental responsibilities is to ensure that the organization governs and operates in an ethical and legal manner. Fostering exemplary conduct is one of the most effective means of developing internal and external trust as well as preventing misconduct. Moreover,[…]

Best practices suggest that it is not a good idea to have the Executive Director playing such a role within the organization, whether the position is a voting or non-voting position. Keep in mind the following precautions if the organization decides to place its executive director on the board: While it is not uncommon for executive directors to serve as non-voting members of their organizations' boards, this can lead to a tricky legal situation. Board members are bound by legal and fiduciary[…]

The executive director reports to the board, with the chief liaison being the chair of the board. This is the body that hires the ED, monitors and evaluates that person’s performance, and directs the search for a new chief executive if that becomes necessary. The ED and the board work together as a team to carry out the mission of the organization, but each entity has autonomy in certain areas. Though there are over-lapping areas, in general the board is responsible for mission and vision, sets[…]

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Attorneys, accountants, and other professionals can contribute valuable expertise to a board. In the best-case scenario, it would be nice if their services would be given voluntarily. However, that is not always feasible.The underpinnings of the policy that allows tax exemption for public charities is that the dollars raised are used for "exclusively charitable and educational" purposes. The IRS wants to be sure that none of the tax-exempt dollars raised by the nonprofit inure to the benefit of[…]

It is probably impossible to find a board member who will never have a conflict of interest. An active board member often has numerous professional and personal affiliations and, undoubtedly, some of them cross paths with your organization. He or she may have been chosen as a board member partly because of these associations or the contacts they might provide.However, if these associations develop into a conflict of interest and become a major obstacle to fulfilling the duty of loyalty — one of[…]

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There are many ways to structure the evaluation of an executive director. Often the board delegates the job to a subcommittee of the board (e.g. executive team), although the whole board should have an opportunity for input. To begin the process, the board and executive director should agree on the timing and form of the evaluation prior to the start of the evaluation period. The evaluation should be based on predetermined criteria, including the executive's job description and personal goals,[…]

In Maryland, nonprofits are private entities and generally are not required to hold “open meetings” unless they were created by governmental action or unless the organization has been required to do so by a governmental entity that funds the organization. However, receiving government funding does not normally require “open meetings.”According to the Open Meeting Acts Manual, published by the Maryland Attorney General’s office, the first step for anyone challenging a closed meeting is to[…]