Page 53 - Washington Nonprofit Handbook 2018 Edition

y Outside activities involving board, advisory board, or managerial or
consulting services for any outside business, government agency, or
individual that does business or competes with the corporation;

y Specific transactions with the corporation related to the sale,
exchange, or lease of property; lending of money or other extension of
credit; furnishing of goods, services, or facilities; payment of
compensation, or payment/reimbursement of expenses in excess of
$1,000; and the transfer of income or assets; and

y Other activities that might be regarded as a potential or actual conflict
of interest in connection with his or her position with the corporation.

Directors are prohibited from entering into any transaction that involves the
flow or transfer of income or assets through or away from the corporation for the
benefit of anyone associated with the corporation. Additionally, the Act prohibits
the corporation from lending money or extending credit to any of its directors. Any
director engaging in such a transaction and any director participating in the making
of such a loan or extension of credit is liable to the corporation for the amount of
the loan until it is paid.

Confidential matters of the corporation should be respected by all directors.
Questions related to whether or not something is confidential should be discussed
with the board and/or legal counsel.

c. Other Obligations

Directors must act lawfully when conducting business on behalf of the
corporation. Directors must also act within the scope of authority and purpose of
the corporation as specified in the corporation’s governing documents. Finally,
directors should ensure that the corporation is in compliance with laws and other
regulations.

A board of directors functions as a group. A director cannot speak on behalf
of the board or act for the board outside a meeting, unless authorized by the board
as a whole. Any director attempting to act on behalf of the board without explicit
authorization is exceeding his or her authority. However, officers and some
committee chairs may have implicit authority to perform certain routine tasks
associated with their jobs.

WASHINGTON NONPROFIT HANDBOOK -42- 2018