---
name: "nonprofit_board_governance"
description: "Run nonprofit board governance that holds up: the three fiduciary duties in plain language, board packets and decision-grade minutes, conflict of interest handling with recusal and documentation, committee structure with charters, the policy set Form 990 Part VI asks about, and an annual governance calendar built around the fiscal year. Triggers on 'nonprofit board', 'board packet', 'board minutes', 'conflict of interest policy', 'board committees', 'Form 990 governance', 'board self-assessment', or 'governance calendar'."
---

# Nonprofit Board Governance

## Purpose
Give a nonprofit board a working governance system instead of a binder nobody opens: directors who know what their duties require in practice, meetings that produce a clean legal record, conflicts handled the same way every time, committees with written charters, and a year mapped in advance so the budget, audit, Form 990, executive evaluation, and policy reviews never arrive as surprises. Ships with a packet template, a minutes template, an annual disclosure form, a committee charter set, a policy checklist keyed to Form 990 Part VI, a worked board year, and a checker script that scores a board against the checklist and lists the gaps.

This is governance practice, not legal advice. State nonprofit corporation law sets many of the binding rules, and those rules differ by state. The skill flags every place the agent must check the state act or the organization bylaws before stating a rule as settled.

## Workflow
1. **Start with the duties, in plain language.** Brief every director on the three fiduciary duties that come from state corporation law and are enforced mainly by the state attorney general:
   - Duty of care: show up, prepare, read the financials before voting, ask questions when numbers do not add up, and see that assets, facilities, people, and goodwill are used prudently.
   - Duty of loyalty: the organization interest beats the director's own interest, every time. The working machinery is the conflict of interest policy in step 4.
   - Duty of obedience: the organization follows the law, its own bylaws, and its stated mission, and it spends restricted donations only on what the donor restricted them to.
   Then draw the board and staff line: the board governs, hires the executive director, sets that person's compensation, and evaluates them. Staff run day to day operations. A board that manages programs has stopped governing, and an executive who sets strategy alone has no oversight.
2. **Fix the meeting system.** Set the meeting cadence and dates for the whole year at the annual meeting. Send the packet at least a week ahead using `assets/board-packet-template.md`: agenda with each item marked Inform, Discuss, or Decide and a time box, a consent agenda for routine approvals, the executive director report, financial statements with budget comparison, committee reports, and the exact text of any resolution the board will be asked to pass. Directors cannot meet the duty of care on material they first see in the room.
3. **Write minutes that record decisions, not discussion.** Use `assets/minutes-template.md`. Record the organization name, meeting type, date, start and end times, location, notice given or waived, directors present and absent, quorum, each motion with mover, seconder, and outcome, abstentions, recusals and declared conflicts, one line of context for major decisions, and every action item with one named owner and a due date. Leave out verbatim debate, quotes, tone, speculation, and privileged legal advice. For an executive session, record that it happened, its general subject, times, and any action taken, and keep the detailed record separate and limited to those who attended. Any vote taken in executive session still belongs in the board minutes. Approve the minutes at the next meeting and keep them permanently; committees that can act for the board keep minutes the same way.
4. **Run conflicts through one fixed procedure.** Adopt a written conflict of interest policy, collect a signed disclosure from every director, officer, and key employee once a year using `assets/coi-disclosure-form.md`, and require disclosure again whenever a matter comes up. When a conflict surfaces: the interested person states the interest, leaves the discussion and the vote, the disinterested directors decide, and the minutes record who disclosed, the nature of the interest, the recusal, the data relied on, and the decision. Where pay or a transaction with an interested person is involved, decide from comparability data (salary surveys, competing bids, appraisals) gathered before the decision. That sequence, documented, is what supports the board if the IRS questions the transaction under the intermediate sanctions rules. See `references/policy-checklist.md` for the full procedure and the policy set.
5. **Structure committees so the full board still governs.** Give every standing committee a written charter: purpose, what it may decide on its own (usually nothing beyond what the bylaws or charter delegate), what it recommends, membership, and how it reports. The standard set is in `references/committee-charters.md`: governance (recruiting, orientation, bylaws, self-assessment), finance (budget, financial reports, internal controls), audit where the organization is independently audited (auditor selection, audit review, whistleblower complaints), and executive (acts between meetings only within limits the bylaws set). Keep committees small, commonly three to five members. An audit committee should be independent of management and include at least one member with real financial expertise. Advisory committees and task forces can include non-directors and community members, but they recommend only; they hold no board authority.
6. **Close the policy gaps Form 990 asks about.** Run `bin/governance_check.py` against a filled answers file (format in the script header and in `references/policy-checklist.md`). Part VI of Form 990 asks whether the organization has a conflict of interest policy with annual disclosure and enforcement, a whistleblower policy, and a document retention and destruction policy. It also asks how many voting members are independent, whether family or business relationships exist among board leaders, whether the board got the Form 990 before filing and how it reviewed it, and whether minutes are kept. The IRS does not require most of these policies under the tax code, and the skill says so plainly. It also treats a row of "no" answers on a public form as a real cost, because funders and regulators read it that way.
7. **Build the annual calendar around the fiscal year.** Use `assets/annual-governance-calendar.md` and `references/worked-board-year.md`. Anchor dates to the fiscal year end rather than fixed calendar dates: approve the budget before the fiscal year starts, accept the audit or financial review when it lands, review the Form 990 before it is filed, evaluate the executive director and set compensation once a year, collect conflict disclosures, elect officers, review the core policies, and run a board self-assessment every year. Put all of it on one page, assign each item an owner, and review the calendar at the annual meeting.
8. **Assess and recruit against the gaps.** Run the self-assessment, bring the results to a full board discussion, and turn the two or three weakest areas into named actions with owners. Keep a simple skills and perspective matrix of current directors, and recruit to fill the holes the matrix shows instead of recruiting whoever is available. Track term limits from the bylaws and stagger terms so the board never turns over all at once.

## Output Contract
- A governance setup or review delivered as: duties brief in plain language, meeting and packet system, minutes practice, conflict procedure, committee structure with charters, policy checklist results, and a one-page annual calendar.
- Filled templates from `assets/` when the user wants documents: packet, minutes, disclosure form, calendar.
- The checker output: a score per section, every gap listed with the fix, and a clear split between items state law or the bylaws decide and items that are board practice.
- Every state-specific rule (minimum board size, notice periods, quorum defaults, committee authority, open meeting duties) is either verified against the state act and the bylaws or labeled unverified. No invented deadlines: filing dates are expressed relative to the organization fiscal year unless the user supplies its actual dates.

## Operating Rules
- Decisions belong in the minutes, discussion does not. When in doubt about a line, ask whether the board would be fine with an auditor, a funder, or a reporter reading it years later.
- One owner per action item, one due date, carried into the next packet until it closes. Action items owned by "the board" or "staff" in general do not get done.
- A conflict handled off the record was not handled. Disclosure, recusal, a decision by disinterested directors, and a minute entry are one package; skipping the paperwork voids the protection the process exists to create.
- Committees recommend, the board decides, unless the bylaws or a charter clearly delegate authority. Never let an executive committee quietly become the real board; the rest of the directors disengage and the duty of care thins out.
- Compensation for the executive director and any interested person gets decided by disinterested directors, from comparability data obtained in advance, documented at the time. Reconstructing the reasoning afterward does not count.
- Keep the Form 990 review real: the full board receives the draft before filing, questions get asked, and the review process is described accurately on the return. Rubber stamp review is visible and it teaches directors the wrong habit.
- Bylaws beat habit. When practice and the bylaws disagree, fix one of them at the next meeting and record which one changed.
- Say plainly that this is practice guidance, not legal advice, and point the board to counsel or its state association of nonprofits for state law questions, contested matters, or anything involving a director's personal liability.