MBA Compliance Essentials Diversity and Section 342 Resource Guide
Fiduciary Duties
1. Created by: Kendra Brown, 2015-2016 National Advisory Board President,
2013-2014 National Chair &
Maritza T. Adonis, 2015-2016 National Deputy Chief of Staff, 2014-2015
SRBLSA Pre-Law Director
2. Thoughts become actions, actions become habits, habits
become our character, and our character becomes our
destiny.
James C. Hunter, The Servant
3. From National Student Leader …
NBLSA’s History and Purpose
Survey of NBLSA’s Constituents
4. …to Business Owner
Board Roles and Responsibilities
Fiduciary Duties
Conflict of Interest Policy
Board Member Agreement
9. WHO IS OUR FOUNDER?,
WHAT LAW SCHOOL WAS
NBLSA FOUNDED IN?
WHAT WAS NBLSA’s original
name?
WHEN WAS NBLSA’s name
changed?
Algernon Johnson (“AJ”) Cooper, former
mayor of Prichard, Alabama,
New York University Law School
Black American Law Students
Association (BALSA)
In 1983, BALSA revised its name and the
word “American” was deleted to
encompass all blacks, including those
not of American nationality. Later, the
word “National” was added to reflect th
organization’s national expansion
10. NBLSA is also comprised of chapters or affiliates in six
different countries including The Bahamas, Nigeria, and
South Africa.
The organization has over 200 chapters and is present in all
but a few of the nation’s accredited law schools, as well as
unaccredited law schools.
Assisted in the formation of the
Black Law Students Association of Canada (BLSAC),
The National Latino/Latina Student Association (NLLSA),
National Association of Law Students with Disabilities
(NALSD), and
The National Asian Pacific American Law Student
Association (NAPALSA).
11. WHY DO WE EXIST?
The purpose of NBLSA is to utilize the collective resources of the member
chapters to:
articulate and promote the educational, professional, political, and social
needs and goals of Black law students;
foster and encourage professional competence;
improve the relationship between Black law students, Black attorneys, and the
American legal structure;
instill in the Black attorney and law student a greater awareness and
commitment to the needs of the Black community;
influence the legal community by bringing about meaningful legal and
political change that addresses the needs and concerns of the Black
community;
adopt and implement policies of economic independence;
encourage Black law students to pursue careers in the judiciary; and
do all things necessary and appropriate to accomplish these purposes.
ONE THING THAT WE ARE DOING TO FULFILL OUR PURPOSE
ONE THING WE ARE DOING TO HURT OUR PURPOSE
14. A legal obligation that is owed or due to another and
that needs to be satisfied. (Black’s Law Dictionary)
15. A fiduciary duty requires board members to
stay objective, unselfish, responsible, honest,
trustworthy, and efficient.
act for the good of the organization, rather than for the
benefit of themselves.
exercise reasonable care in all decision making, without
placing the organization under unnecessary risk.
(Boardsource)
16. Every board member needs to be a financial inquisitor.
understand basic terminology,
be able to read financial statements and judge their
soundness, and
have the capacity to recognize warning signs that might
indicate a change in the overall health of the
organization.
IMPORTANT: If a board member does not understand
something, he or she must be willing to find out the
answer.
17. Board members are the fiduciaries who
steer the organization towards a sustainable future by
adopting
sound governance and
financial management policies, and
ensuring adequate resources.
Just as for any corporation, including nonprofit
corporations, the board of directors have three primary
legal duties known as the:
“duty of care,”
“duty of loyalty,” and
“duty of obedience.”
19. This refers to board members’ responsibility to actively
participate in making decisions on behalf of the
organization and to exercise their best judgement
while doing so.
NOTE: In limited circumstances---you can be personally liable for NBLSA’s
nonprofit financial responsibility
21. When acting on behalf of the organization in a
decision-making capacity, board members must set
aside their own personal and professional interests.
The organization’s needs come first. All decisions
must be made in the best interest of the
organization.
22. Examples of where parties exercised a duty of loyalty.
23. Board members bear the legal responsibility of
ensuring that the organization remains true to its
mission and purpose by its compliance with all
applicable federal and state laws.
24. Examples of where the parties exercised a duty of
obedience
25. Finance Decisions (ie. Contracts)
Governance Decisions (ie. Adding and removing
positions; failure to ask questions)
26. Is our financial plan consistent with our strategic plan?
Is our cash flow projected to be adequate?
Do we have sufficient reserves?
Are any specific expense areas rising faster than their sources of
income?
Are we regularly comparing our financial activity with what we have
budgeted?
Are our expenses appropriate?
Do we have the appropriate checks and balances to prevent errors,
fraud, and abuse?
Are we meeting guidelines and requirements set by our
funders/sponsors/laws?
(Questions adapted from The Financial Responsibilities of Nonprofit
Boards by Andrew Lang.)