
The importance of understanding the responsibilities of the board in non-profit organisations
Civil Society & NGOs - 2025-01-28
Getting involved in a non-profit association is often rewarding and fulfilling, but it also comes with responsibilities. As a board member of a non-profit association, you play a crucial role in managing the organisation – and you also carry legal responsibilities that can sometimes be difficult to fully grasp.
The board of a non-profit association is responsible for ensuring that the organisation operates in accordance with its bylaws, internal rules, and applicable laws. This responsibility includes, among other things:
Ensuring the organisation’s finances are managed appropriately.
Fulfilling obligations to suppliers and other external parties.
Ensuring taxes and fees are paid on time.
Failure to meet these responsibilities can, in the worst-case scenario, result in liability for damages to the association, or even personal liability for individual board members for the organisation’s debts. This is particularly relevant if the board has acted negligently or recklessly, or made decisions that violate the law or the association’s bylaws, causing harm to the organisation.
The most common cause of personal liability, however, is poor financial management that leaves the organisation unable to pay taxes and fees to the tax authorities when due. In such situations, it is particularly important that all board members understand both their responsibilities and the risks involved, as well as how to act to avoid personal liability.
Five pro tips to protect both the board and the organisation
To minimise the risk of personal liability, while demonstrating swift and responsible action in the organisation’s best interests, it is crucial to:
Maintain clear and up-to-date bylaws and ensure they are adhered to in operations.
Document decisions made at board meetings.
Regularly review the organisation’s finances and any agreements.
Pay taxes and fees on time – and file for bankruptcy before the due date if payment is not possible.
Obtain liability insurance for the board.
Does your organisation need help with liability or other legal issues?
Allocating responsibilities and ensuring compliance within non-profit associations can be complex. At Engström & Hellman Advokatbyrå, we specialise in legal matters for non-profit organisations and foundations.
We are happy to assist you with advice on board responsibilities, bylaws, agreements, and other areas relevant to your organisation. Contact us to ensure that your organisation and its board act in accordance with the law – being informed and taking timely action is the best way to protect both the organisation and yourselves.