THE PURPOSE OF THE BOARD
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he role of the board is to act as the rudder of the organisation, directing the course of the ministry and navigating the often complex waters of finance, legislative compliance, workplace health and safety and employment practices to name a few. Boards will be responsible for: • Accountability - by ensuring that the church or charity they represent operates transparently, manages its finances well and meets all its legal obligations • Policy – by clearly setting out the purpose of your organisation, establishing the ministry’s long-term goals and how those goals will be pursued • Resourcing – ensuring that sufficient funds are secured to support and maintain the goals of the organisation • Advocacy – representing your organisation to the public, your members and other key stakeholders • Observing – that your organisation is being run within documented guidelines and the law The duties and responsibilities of a board member
It should be noted that other people who may be considered part of the “governing body” of an organisation even though they are not officially recognised as board members may also include: • Someone who is in position of influence within the organisation (e.g. Pastor) • Someone who participates in the key decisionmaking process for the operation of the organisation • Someone who has the capacity to significantly impact the organisation’s financial standing • Someone whose instructions or opinions board members are used to acting on EXAMPLE: Founding pastor of a church who remains heavily involved The founding pastor of a church, which was established some 20 years ago, has been on the board up until his retirement two years ago. Although no longer an official board member, he still regularly attends board meetings, and board members regularly seek his opinion prior to major decisions being made for the church. In this case, he still may be considered a member of the governing body of the organisation and because board members are used to acting on his instructions or opinions, and as such, he would be expected to comply with the above-mentioned legal duties.
Often there is a misconception that because a board member may be filling the role voluntarily, there is no obligation for them to comply with the legal duties of a board member. This is false. It does not matter how small or informal your organisation may be, how many members you have, how long you have been part of the organisation, or how much experience you may or may not have in the role, all members of the board must comply to the same legal standard. The law states that the relationship between a board member and the organisation they represent is one of trust and therefore the role must be carried out ensuring that you comply with the following four key legal duties: • Duty to act in good faith, and for a proper purpose • Duty to act with reasonable care, skill and diligence (including the duty to prevent insolvent trading) • Duty not to improperly use information or position, and • Duty to disclose and manage conflicts of interest
LEGAL DUTIES 1. Duty to act in good faith This requires you to make decisions that are based on what is best for your organisation. In doing so, you should ensure that you take into consideration what is best for the purpose of the organisation, it’s members, the finances and operations. You must not base your decisions on personal preference, goals or perhaps affiliations you may have with other organisations. In addition, you should not allow other people to dictate how you should vote on certain matters at board meetings. To ensure that you are making your decision based on the ‘right purpose’, your board should familiarise themselves with the mission statement. Are the decisions > being made with these statements or objectives in mind? 23