How to Develop a Board of Directors for a Nonprofit in Ohio

A board of directors is a requirement for the operation of an Ohio nonprofit entity. This elected group serves as the governance of your organization in everything from finances to the nonprofit’s mission.

Electing the right personalities to your board of directors is essential for your organization’s success. This guide will help you select your first board or grow an established board to better serve your nonprofit.

Check out our other guides for a look at how to form a nonprofit organization or how to select a board of directors in other states.

Recommended: Northwest can help form your nonprofit for you for $29 + state fees.

Star Rating 5 out of 5

Start your business for $29 with Northwest

  • Formation and FREE registered agent services for your first year
  • Best privacy protection and customer service

Form Your Nonprofit

Ohio Board of Directors Requirements

The Ohio Nonprofit Corporation Law, Section 1702.27, defines director requirements in the following way:

(1) The number of directors as fixed by the articles or the regulations shall be not less than three or, if not so fixed, the number shall be three, except that if there are only one or two members of the corporation, the number of directors may be less than three but not less than the number of members.

(2)(a) Subject to division (A)(2)(c) of this section, unless the articles or the regulations fix the number of directors or provide the manner in which that number may be fixed or changed by the voting members, the number may be fixed or changed at a meeting of the voting members called for the purpose of electing directors, if a quorum is present, by the affirmative vote of a majority of the voting members present in person, by the use of authorized communications equipment, by mail, or, if permitted, by proxy.

Putting It Into Practice

An Ohio nonprofit’s board of directors works as a support system for the organization. Its duties include financial management, structural guidance, the hiring of executive directors, and much more. While the board typically isn’t involved in day-to-day operations, it plays an active role in maintaining the well-being of the organization as a whole, its effectiveness, and its financial health.

A 501(c)(3) eligible nonprofit board of directors in Ohio MUST:

  • Have at least three board members that are not related to each other
  • Elect the following members: president, treasurer, and secretary

Recommended: Read our full guide on How to Start a Nonprofit in Ohio.

What Is the Function of the Board of Directors?

The Nonprofit Corporation Law, Section 1702.01 establishes the role of directors in the following manner:

(K) “Directors” means the persons vested with the authority to conduct the affairs of the corporation irrespective of the name, such as trustees, by which they are designated.

Putting It Into Practice

Before forming your Ohio nonprofit’s board of directors, it’s important to understand the role this group plays in the success of your organization. The general responsibilities of a board include:

  1. Enforcing the Organization’s Mission and Purpose: The foundation of any nonprofit is its mission so a board’s chief task involves upholding that mission as well as the organization’s purpose.
  2. Hiring a CEO/Executive Director: While your board of directors plays an instrumental role in the success and effectiveness of your nonprofit, it doesn’t participate in the daily operations. That makes it vital for the board to hire a CEO or executive director who will provide effective, day-to-day leadership.
  3. Incorporating New Members: A board also must source and incorporate new board members capable of effectively upholding the organization’s values.
  4. Assessing the Allocation of Funds: Careful distribution of assets within an organization ensures all areas receive adequate funding and thus supports the success of each aspect of a nonprofit’s mission.
  5. Generating Funds and Ensuring Financial Stability: Alongside verifying the appropriate distribution of funds, the board also has a responsibility to generate more assets to create a solid foundation for the nonprofit’s long-term financial stability.
  6. Supporting and Evaluating the CEO/Executive Director: A nonprofit’s board of directors not only serves as a support system for the CEO/executive director, but also assesses their job performance.
  7. Ensuring the Organization Follows Legal and Ethical Practices: It comes as no surprise that upholding the ethics of a nonprofit is essential to its success in achieving its mission. In this case, the board’s task involves ensuring the organization consistently follows legal and ethical practices across its operations.
  8. Generating a Positive Public Image: Building trust within the community not only attracts private investors, but also develops credibility among community members who may use the services your organization offers.
  9. Acknowledging and Addressing Conflicts of Interest: The Internal Revenue Service (IRS) requires nonprofits to develop a written conflict of interest policy that the organization’s board of directors will enforce. This prevents any board member from using their position in order to serve their personal interests.

Additional Legal Responsibilities

In Ohio, a nonprofit’s board of directors also must fulfill certain legal responsibilities. The two most common legal responsibilities of an Ohio nonprofit include duty of care, duty of loyalty, duty of compliance, and duty to manage accounts.

  • Duty of Care: At a minimum, board members must attend and participate in meetings. In addition to this, read and review reports, record all actions made during meetings, and review the performance of the CEO or Executive Director.
  • Duty of Loyalty: This involves acknowledging and disclosing any conflicts of interest as well as making decisions that benefit the nonprofit as a whole rather than a single board member.
  • Duty of Compliance: Board members should be dedicated to upholding the mission of the organization. They also must ensure the nonprofit adheres to all applicable laws and regulations while operating under the mission and bylaws that form its foundation.
  • Duty to Manage Accounts: In Ohio, this involves making appropriate use of the assets held by the organization. Specifically, board members must ensure the use of such funds promotes the good of the organization and those who benefit from its services.

Developing Your First Board of Directors

If you’re still in the process of developing your Ohio nonprofit entity, choosing the right board members is key to ensuring the effectiveness and stability of your organization. Here are a few tips to help you get started:

  • Solidify Roles. Designating functional roles for individual board members — outside of your elected officer’s roles — can improve the board’s overall effectiveness and functionality.
  • Develop and Commit to Bylaws. Creating a set of bylaws to uphold the mission of your organization creates a strong foundation to guide board members’ decision-making. In addition, state law may require Ohio nonprofits to develop bylaws.
  • Prioritize Your Mission. Another beneficial strategy when choosing board members is to seek candidates with a passion for your organization’s mission and goals.
  • Acknowledge Any Conflicts of Interest. Conflicts of interest will inhibit a board member’s ability to effectively uphold the values and best interests of your organization. That makes it extremely important to assess potential or existing conflicts of interest when evaluating board members for your nonprofit.

Filling Board Vacancies

Vacancies in an Ohio nonprofit’s board of directors can be filled according to Section 1702.29 of the Nonprofit Corporation Law:

(C) Unless the articles or the regulations otherwise provide, the remaining directors, though less than a majority of the whole authorized number of directors, may, by the vote of a majority of their number, fill any vacancy in the board for the unexpired term. Within the meaning of this section, a vacancy exists in case the voting members increase the authorized number of directors but fail at the meeting at which such increase is authorized, or an adjournment thereof, to elect the additional directors provided for, or in case the voting members fail at any time to elect the whole authorized number of directors.

Putting It Into Practice

When electing new members to your Ohio nonprofit’s board of directors, focus on finding individuals dedicated to your organization’s mission. Here are a few tips to consider as you begin your search:

  • Look to Your Volunteers. Volunteers who stand out can make excellent additions to a board of directors. These individuals already dedicate their time and energy to your organization and most likely will bring that same dedication and goodwill to your board.
  • Explore Candidates Among Loyal Donors. Donors represent another group to consider when electing new board members because they create the financial foundation for your organization. That means they have a track record of dedicating time and money to ensuring the success and sustainability of your nonprofit.
  • Expand Your Search. Diversifying your search to include outside groups can prove effective in creating a well-rounded board of directors.

What Are Elected Officers?

Section 1702.34 further outlines the election of officers to the board:

(A) The officers of a corporation shall consist of a president, a secretary, a treasurer, and, if desired, a chairperson of the board, one or more vice-presidents, and such other officers and assistant officers as may be deemed necessary, each of whom may be designated by such other titles as may be provided in the articles, the regulations, the bylaws, or resolutions of the directors. Unless the articles or the regulations otherwise provide, none of the officers need be a director. Any two or more offices may be held by the same person. The officers shall be elected or appointed at such time, in such manner, and for such terms as may be prescribed in the articles or the regulations. In the absence of any such provision, all officers shall be elected annually by the directors.

Putting It Into Practice

Elected officers are members of the board with assigned roles focused on regulating the day-to-day activities of the organization and maintaining its success. Each position should have a clear role defined in the organization’s bylaws.

The board of directors is required to nominate elected officers in Ohio. Elected officer roles can not only prove helpful in ensuring the effectiveness of the board of directors, but also provide a foundation of leadership.

The three elected officers required for nonprofits in Ohio include:

  • President: As the leader of the board, the president commonly has authority over key activities like signing contracts and hiring or firing employees. This role differs from the CEO/executive director position, which the board typically hires after assigning the president role.
  • Treasurer: The treasurer is responsible for evaluating the financial health of the organization by keeping track of receipts and spending.
  • Secretary: This individual serves as the organizer of the board meetings, which may include scheduling the meetings, informing board members of the meeting schedule, planning the meeting agendas, and recording meeting minutes.

Conclusion

Forming a board of directors is an essential part of creating and operating a nonprofit in Ohio. Ideally, this group will advocate for your organization’s best interests in everything from finances to public relations. To form or expand a board of directors that will best represent your nonprofit’s needs, search for members who will uphold your organization’s mission and purpose.

Related Articles