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Can an employee serve on a private nonprofit corporation board of directors?
Yes. This is an issue of state law, but I am not aware of any state nonprofit corporation law that prohibits employees of nonprofit corporations from serving on the Board of their employer. There may be limits on the percentage of the Board that can be employees in a few states, but that is not an outright prohibition.
Unlike business corporations, where Congress and the SEC have been concerned about having more non-employee “independent” directors, nonprofits generally do not have staff on the Board. The full-time CEO may serve in larger organizations or the founder executive director may serve in smaller organizations, but subordinate staff very seldom serve. It can create significant problems in administration if subordinate staff serve on the Board, especially if the CEO is not a member.
Article Archives >> To the Point
Nonprofit Leadership & the Law
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