A Sail Held in Common: six people attend the ropes of an indigo and golden sail, a painted reflection on shared responsibility and an institution's continuity.
How to turn fiduciary duties into sound decisions and prepare a nonprofit board to lead through changes in leadership
By Arbab Naseebullah Kasi, Chief Executive Officer - CEO, Feel Worldwide Foundation Inc..
A useful test of a new nonprofit board is what happens when its founder cannot attend the next meeting.
Can the directors find the governing documents, understand the finances, establish a quorum and make the decisions within their authority? Would someone know which commitments are urgent? Could the meeting proceed without waiting for one person’s explanation of everything?
These questions do not diminish a founder’s contribution. They reveal whether that contribution is becoming an institution capable of carrying its purpose forward. A founder can bring indispensable knowledge and energy while helping other people acquire the authority and information to govern well.
This article concerns US nonprofit corporations pursuing charitable purposes, particularly organizations seeking or holding section 501(c)(3) public-charity status. It offers practical governance recommendations alongside examples of legal requirements. Official sources were checked on November 9, 2026. State law, the corporation’s governing documents and its particular circumstances control. This is general education, not individualized legal or tax advice.
Establish where authority actually comes from
Start with the applicable nonprofit statute, the filed articles or certificate of incorporation, and the bylaws. Identify who elects directors, who can remove them, which powers belong to voting members, and whether another person or body holds reserved powers. A founder’s title alone does not answer these questions.
New York, for example, generally places management with the board but permits its certificate of incorporation to provide otherwise. People who receive management powers under that provision assume corresponding obligations and liabilities. Read the actual arrangement rather than assuming every nonprofit has identical governance. New York Not-for-Profit Corporation Law section 701.
Make a short written list of decisions reserved to the board or members and decisions delegated to officers or staff. Include budgets, major contracts, borrowing, senior leadership appointments and new programs. Specify financial limits and reporting expectations where useful. Have the appropriate governing body approve the arrangement in a legally valid way.
An advisory council can contribute expertise and introductions. Its name should not obscure whether it has any actual governing power. Likewise, an individual director should not assume that a board seat authorizes them to instruct staff, sign agreements or speak for the corporation. Establish those permissions explicitly.
Recruit for judgment and availability
A board needs people who will prepare, attend, question and follow through. Friendship with the founder can coexist with these qualities, but friendship alone is a weak selection method.
Legal minimums vary. New York requires a board of at least three directors. Pennsylvania permits one or more and sets rules for determining the number through the bylaws or articles. Neither example supplies a national rule or proves that the smallest permitted board will serve your organization well. New York section 702 and Pennsylvania section 5723.
For practical recruitment, identify the work the board must understand. A small community charity may need financial literacy, knowledge of its programs, local relationships and experience supervising people. Include people who understand the conditions faced by the intended community. Avoid treating one director as the sole representative of a varied population.
Discuss the expected meeting schedule, preparation, committee work and any fundraising expectations before someone accepts. Give candidates enough information to judge whether they can serve responsibly. A person who declines because they lack time may be protecting the organization from an empty seat in practice.
Seek enough independent judgment to evaluate the founder’s proposals fairly. The IRS encourages informed, active boards with independent members and cautions against domination by employees or family and business relationships. This is governance guidance, not a universal federal requirement that every charity have a particular number of unrelated directors. IRS governance guidance.
Translate fiduciary duties into meeting behavior
The familiar duties of care, loyalty and obedience become useful when directors connect them to concrete decisions. The New York Attorney General describes these duties in its guidance for nonprofit boards. Right from the Start.
Care means giving the work informed attention. Read the financial report, ask why cash is falling and request missing information before approving a substantial obligation. Attendance matters, but attendance without preparation leaves important questions unasked.
Loyalty means acting for the organization’s interests. Disclose relevant personal interests and follow the applicable conflict policy and law when a decision involves them. Conflicts deserve a reliable process, but managing them is only one part of governing.
Obedience means respecting the charitable purpose, governing documents and applicable law. A tempting grant still needs scrutiny if its conditions would pull the organization away from its authorized purpose or obligations.
Directors can use qualified professional advice without pretending to be lawyers or accountants. New York’s statute permits specified good-faith reliance on competent officers, experts and committees, subject to its conditions. That reliance is not a reason to ignore information suggesting a problem. New York section 717.
For each major proposal, ask what information is missing, whose interests are affected and how the decision serves the mission. When the answer is uncertain, a narrower commitment or a request for further work may be wiser than immediate approval.
Separate the board role from the operating role
In a young nonprofit, the same people may govern, organize events and answer emails. That can be practical. Confusion arises when an operational conversation silently becomes a board decision, or when a director’s personal preference is treated as an instruction from the whole board.
Define the roles in plain language. A chair can organize the board’s work and make room for questions. A secretary can maintain the official record and track required notices. A treasurer can coordinate financial reporting and help the board understand it. An executive director or CEO can manage activities within delegated authority. These are suggested working arrangements, to be reconciled with your law and documents.
Officer combinations and eligibility also vary. New York generally permits multiple offices to be held by one person but prohibits combining president and secretary. An employee serving as board chair requires the approval and written documentation specified in that state’s statute. Avoid assuming that a familiar arrangement elsewhere is automatically permitted. New York section 713.
Agree on how the board will evaluate the chief executive, including a founder serving in that role. Use written expectations tied to the actual job and resources available. Arrange for concerns about the chief executive to reach an appropriate board contact without requiring that executive’s permission. Oversight should be predictable enough that an honest question does not feel like a personal confrontation.
Make the bylaws usable during a disagreement
Bylaws should help people determine the next lawful step when they disagree or someone leaves. Review provisions on board size, selection, terms, vacancies, removal, officer roles, meetings, notice, quorum, voting, committees and amendments. Check any member rights carefully.
The IRS describes bylaws as internal operating rules and notes that federal tax law generally does not prescribe specific bylaw language for most organizations. State law may require bylaws. A downloaded document therefore needs state-specific review rather than an assumption that it is an IRS-approved solution. IRS explanation of bylaws.
Keep routine administrative details in policies where appropriate instead of requiring a bylaw amendment every time an ordinary procedure changes. Record the adopted version and amendment history so directors do not operate from conflicting copies.
Quorum deserves particular attention. It is the participation threshold for conducting specified business, distinct from the vote needed to pass a motion. In New York, a majority of the entire board is the default, with permitted alternatives and minimums set by statute. Do not copy that formula into an organization governed by another state’s law without checking it. New York section 707.
Consider a five-director board whose applicable rules require three directors for quorum and a majority of those present to approve an ordinary motion. If three attend, two affirmative votes would meet that voting threshold. This is an illustration with stated assumptions, not a rule for every action. Vacancies, recusals, special decisions and higher voting requirements can change the analysis.
Remote participation and written consent also require care. New York permits qualifying real-time remote participation and, unless restricted, unanimous written or electronic consent for action without a meeting. A majority replying “yes” to an email is not the same procedure. Verify the rules before relying on electronic approval. New York section 708.
Keep minutes that make decisions understandable
Minutes should allow a later reader to understand what the board decided and how it acted. As a practical record, include the date, participants, notice or waiver information, quorum, motions, voting outcomes, relevant recusals and assigned follow-up. Identify the versions of budgets or policies approved. Capture the basis of significant decisions without turning the record into a transcript.
State law can impose recordkeeping obligations. New York requires correct and complete accounting records and minutes of specified governing proceedings. Follow the requirements that apply to your corporation. New York section 621.
For Form 990 Part VI, the IRS asks whether meetings and written actions were documented contemporaneously by a method permitted under state law. Its instructions define that timing as the later of the next meeting or 60 days after the action. That reporting definition does not replace a stricter legal requirement or a sound practice of drafting minutes promptly. Form 990 instructions for Part VI.
Assign preparation, review and storage. Retain approved minutes and consents in an organizational record system with appropriate access and backup. Handle sensitive personnel matters carefully. Never backdate approval or invent a meeting to repair a missing record.
Put financial oversight on the agenda before money is scarce
Ask for a financial report that shows the board actual income and spending against its budget, available cash, material obligations and funds subject to restrictions. Ask who prepares it, who reviews it and what would trigger an urgent warning between meetings.
Agree on spending authority and a second person’s review where feasible. A small team may be unable to separate every task, but it can identify where one person controls too much and arrange an independent check. The treasurer’s involvement should help the whole board understand the finances rather than relieve everyone else of interest in them.
Compensation needs a documented decision. A charitable organization must not operate for private interests or allow prohibited private inurement. Legitimate pay should be evaluated for the services provided and the applicable legal rules, including rules concerning excess benefits to influential insiders. IRS exemption requirements.
For applicable tax-exempt organizations, the IRS describes a rebuttable presumption of reasonable compensation when an authorized body without a conflict approves the arrangement in advance, relies on appropriate comparability data and adequately documents its basis on time. The record should cover the terms, participants, data and handling of conflicts. This presumption can be rebutted and is not a guarantee that any payment is acceptable. Private foundations have separate rules requiring particular care. IRS rebuttable-presumption guidance.
Use an actual job description and consider the total arrangement, not only salary. If suitable comparability evidence is missing, assign someone to obtain it before deciding. Gratitude for years of unpaid work does not substitute for evaluating a proposed compensation package.
Plan continuity while the founder is present
Ask what would stop if the founder became unavailable for a month. The answer often reveals practical dependencies: a contract no one else has seen, a bank relationship known only to one person or a filing deadline in a private calendar.
Build an emergency continuity plan identifying who can convene the board, who can receive temporary operating authority and how essential records and organizational accounts remain accessible through authorized procedures. Use individual access controls and a proper recovery process rather than circulating passwords in minutes.
Then address planned succession. Define how the board will select the next chief executive, how responsibilities will transfer and what any continuing founder role would include. Review employment agreements, governing documents and reserved powers before assuming the board can implement a particular transition.
Board continuity needs attention too. Discuss director terms, recruitment, vacancies and orientation. Consider staggered terms or term limits where suitable and permitted, but do not treat either as a universal requirement. Invite newer directors to lead substantive work before a departure forces them to learn under pressure.
A simple rehearsal can reveal gaps: ask another authorized person to locate the latest budget, explain an upcoming decision and identify the next filing date. Fix what they cannot find. The founder gains colleagues who can carry responsibility, and the organization gains a better chance of continuity.
Use the first governing meeting to establish working habits
Before the meeting, circulate the charter, proposed bylaws, director and officer information, initial budget, draft policies and proposed resolutions. Confirm that the people attending have been appointed or elected through the proper process. Complete any prerequisite incorporator actions. Provide the required notice or valid waivers and enough time for review.
The following two-hour agenda is a suggested structure, not a universal statutory checklist. Adjust it to your state, existing approvals and the decisions actually ready to be made.
Opening and authority, 10 minutes: Record attendance, confirm notice and quorum, identify the chair and minute taker, and collect disclosures relevant to the agenda.
Purpose and priorities, 15 minutes: Discuss whom the organization will serve and approve or confirm an initial mission statement consistent with its charter. Identify what will wait.
Bylaws and board structure, 20 minutes: Resolve questions about selection, terms, vacancies and meetings. Adopt the bylaws if ready and within the body’s authority. Record any further review needed.
Officers and delegation, 15 minutes: Elect or appoint officers as authorized. Set responsibilities, signing authority and matters that must return to the board.
Budget and financial controls, 20 minutes: Examine the cash assumptions, approve an appropriate initial budget and banking resolutions, and assign financial reporting and review.
Policies and compensation process, 15 minutes: Address the conflict policy and other policies appropriate to the organization’s obligations. Establish how any compensation proposal will be evaluated. Defer approval if the required information or decision makers are missing.
Continuity and compliance, 15 minutes: Assign the record system, filing calendar and emergency leadership plan. Identify who will verify requirements still unresolved.
Decisions and next meeting, 10 minutes: Read back the decisions, confirm each action owner and due date, and set the next meeting and reporting expectations.
Do not rush a difficult issue simply to finish the agenda. A clear decision to obtain advice or further evidence is more useful than an approval that no one can explain afterward.
The IRS generally does not require the policies and practices described in Form 990 Part VI merely because it asks about them. Other laws may impose obligations, and the IRS uses governance information in assessing compliance risk. Report what the organization actually does rather than adopting documents solely to answer “yes.” IRS guidance on Part VI information.
Give the mission a future others can carry
Return to the opening test. If the founder missed the next meeting, could the board act lawfully, thoughtfully and with enough information? If the answer is uncertain, choose one gap to close now: clarify authority, recruit an engaged director, approve a usable reporting process or rehearse an emergency handover.
A founder’s work can remain deeply valued as responsibility becomes shared. The goal is a board whose members can explain their decisions and help the organization continue serving its purpose when people and circumstances change.
If you see a practical opportunity for community-focused collaboration, I warmly invite you to explore a partnership with Feel Worldwide Foundation. Share the outcome, location and contribution you have in mind so a possible fit can be considered. An inquiry does not guarantee a partnership or governance advisory services. If you would like to support the Foundation through a gift, you are welcome to visit the donation page and review the available giving options and terms. Thank you for considering how your experience or generosity might contribute.
