Agreement to Serve on Board of Directors: What You Need to Know

Serving on a board of directors is not only an honor, but it also comes with great responsibility. Board members are entrusted with overseeing the management and direction of an organization. They play a vital role in making important decisions that will impact the organization`s future. If you have been asked to serve on a board of directors, it is important to understand the agreement you will be entering into.

An agreement to serve on a board of directors is a legal contract between the organization and the individual board member. It outlines the expectations, duties, and responsibilities of each party. Before you sign the agreement, it is important to review it carefully.

Here are some key points to consider:

1. Term of Service

The agreement should clearly state the term of your service. This could be a specific number of years, or it may be open-ended. It is important to understand the commitment you are making before you agree to serve.

2. Duties and Responsibilities

The agreement should outline your duties and responsibilities as a board member. This may include attending regular meetings, participating in committee work, and providing advice and guidance to the organization`s leadership team. It is important to understand the level of commitment required before you agree to serve.

3. Liability Protection

Most organizations provide liability protection for their board members. The agreement should outline what type of protection is provided and what circumstances it covers. This is an important consideration as serving on a board can expose you to significant legal and financial risks.

4. Compensation

Board members are typically not compensated for their service. However, some organizations may provide a stipend or reimbursement for expenses. The agreement should outline any compensation that will be provided.

5. Confidentiality and Non-Disclosure

Board members often have access to confidential information about the organization. The agreement may include a confidentiality and non-disclosure clause that prohibits you from sharing this information with others. It is important to understand the scope of this clause before you agree to serve.

In addition to these key points, the agreement may also include other provisions related to your service on the board. It is important to review the agreement carefully and seek legal advice if necessary.

Once you have reviewed and agreed to the terms of the agreement, it is important to fulfill your duties and responsibilities as a board member. Serving on a board of directors can be a rewarding experience, but it requires a significant commitment of time and energy. By understanding the agreement you are entering into, you can ensure that you are prepared to meet the expectations of the organization and fulfill your role as a board member.