The term ‘duty of care’ is often tossed around during board meetings, but what does it actually mean for your NFP or club?

As a member of the board, you are legally recognised as a director, and that brings many responsibilities, of which the duty of care is an important one. In essence, the duty of care means that you have a responsibility to protect and manage the interests of your members and related groups.

In simple terms, your duty of care covers these responsibilities.

1. Making decisions for the good of the organisation: There will be times when an issue comes up that would offer you a personal advantage or benefit.  Your duty of care requires you to put the good of the group ahead of your own interests.

2. Maintaining honesty and transparency in your decisions and actions: You are responsible for managing the organisation to the best of your ability, and that includes managing the accounts. You take steps to ensure that the NFP is in compliance with all federal and state financial and reporting requirements. You cannot allow the NFP to operate in a manner that threatens its insolvency.

3. Maintaining honesty and transparency in your personal and professional dealings: There is no clear division between your personal and professional life. You are legally and personally responsible for the actions of the board, and that impacts on the way your present yourself at all times. Your duty of care requires you to avoid any actions or behaviours which would reflect badly on the organisation.

You are responsible for the reputation of your organisation. Your duty of care requires you to work actively to protect it at all times.