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May group accept donation for seat on the board?

Your Legal Questions Answered

May group accept donation for seat on the board?

Someone offered me a large donation in exchange for a seat on my board. Can I legally accept? 

Assuming that this is an offer for a donation to the organization and not to you personally, and assuming that your organization is a traditional private nonprofit corporation and not a governmental agency, this seems to be just a reversal of the much more frequent proposition from the organization to its directors: “Give, get, or get off.”
I don’t know any reason why it would be illegal to accept the offer. The real question is whether you want this person on the board. And who makes that decision.
Unless you are the sole member of “your” organization with the right to appoint and remove directors unilaterally (and perhaps even if you are), there ought to be a board-directed process for selecting new directors. Somebody should be vetting the candidates to assure that they will bring appropriate skills and resources to the organization and will come with proper motives of their own. Money is nice, but it isn’t everything. If you follow the process, most people are likely to feel better about the results.
Tuesday, August 26, 2014


I am the Founder and President of a new, nonprofit and can truly say that the need for donations is a great one for us at this point. However, no matter how much your organization is in need of this money, it would NOT be advantageous to have this person on your board as board members should be people who are willing to have the organization's best interest at heart, should be fair and most importantly…one who has morals and ethics. It is obvious that this person lacks all of these, especially the latter and would end up being a problem later on down the line as he or she apparently feels that they can use money as power over others and would feel as though they have “paid” to be the boss and that all of their ideas should be made priority. What would be next? Would they demand to be the chair or that you use his family member or friend as a vendor as opposed to the one that you already have? What would happen if he or she is opposed or challenged?

When he or she “paid” to get on the board (especially when no one else has), they would feel entitled and that is definitely something that you do not want and should avoid at all costs as your board, and it's reputation, is what drives the organization and if there is tension on the board, people start talking and before you know it, you will have a hard time recruiting new board members and getting new donors. Now if he or she is talking about giving you the money for your personal use, now that would definitely be a no no as it is just morally wrong. Besides, it will come back to bite you. Politely tell them that you can't accept the offer and that if he or she wishes, they can apply for board membership (like everyone else) and that it will be reviewed and they will be notified as to whether they would accepted or make it to the next step in the selection process. If you do not have a board yet, you can make the decision then but I wouldn't advise this as it would be awkward since the offer was made to you and he or she make take it too personal. You need to start recruiting, hold an information, accept applications, review and accept the ones you would like to have as your founding board members. I know I was little talkative, but my organization is in its infancy and your question could very well be one that may be an issue for me. I hope this helped.

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