What Are the Duties of a Nonprofit President?

By Michelle Kaminsky, J.D.

What Are the Duties of a Nonprofit President?

By Michelle Kaminsky, J.D.

A nonprofit president may perform various managerial tasks within the company, but federal and state law, along with the organization's creation documents, determine their duties.

Businesspeople talking around conference table

Just as with a corporation, a nonprofit must follow applicable state law regarding its formation, organization, and operation. Additionally, because nonprofits exist to further some form of public good, they must also abide by federal laws and reporting regulations, notably those of the Internal Revenue Service (IRS) and Securities and Exchange Commission (SEC), to continue receiving the tax advantages of a nonprofit organization.

Becoming President of a Nonprofit

The laws of most states require nonprofits to elect at least three officers—president, secretary, and treasurer—and the organization defines their duties in its bylaws. Although the same person may hold two of the three positions, holding the role of president and another office is not the norm. However, it is relatively common for someone to act as both secretary and treasurer.

Most nonprofit bylaws provide that the president act as its primary executive officer as elected by the board of directors. The precise voting method may vary by organization. Usually the board may remove the president for any reason—and even without cause.

In short, the president serves at the will of the board.

Roles According to Bylaws

The bylaws of most nonprofits describe the responsibilities of its president, which generally include the following duties:

  • Supervising all functions of the company
  • Ensuring compliance with all applicable federal and state laws and regulations
  • Signing authority, or signing legal documents on its behalf
  • Reporting to the board of directors and, often, presiding over board meetings

Nonprofits, especially larger ones with many shareholders, may also choose to elect one or more vice presidents to aid the president in carrying out duties. Again, the organization's bylaws should define the precise duties of all officers.

Fiduciary Duty

One duty that is generally not left up to the organization's bylaws is fiduciary duty to the company. Indeed, most states have laws providing that all officers of a nonprofit corporation have a fiduciary duty to the company and its members, or shareholders.

Fiduciary duty is the legal responsibility of an officer to act in the best interests of the company and its shareholders. A corporation's officer generally may not act in self-interest or hold outside interests that conflict with those of the company without risking legal liability.

For example, the president's encouraging the nonprofit to do business with a private company she owns could violate the president's fiduciary duty to the nonprofit.

The nonprofit's bylaws should have provisions in place to both define conflicts of interest and provide a procedure for how to handle them.

Federal Law

One of the most important aspects of a nonprofit is its tax-exempt status, which means compliance with IRS and other federal laws is crucial in the continued functioning of the corporation. Along with those requirements listed in the Internal Revenue Code, the president must also ensure the corporation doesn't run afoul of other laws and jeopardize its tax-exempt status, such as the Johnson Amendment, which prohibits a 501(c)(3) nonprofit corporation from endorsing or opposing political candidates.

In addition to making sure the nonprofit is complying with IRS tax-exemption requirements, the president must also oversee the compliance with all relevant federal laws such as the Sarbanes-Oxley Act of 2002, enacted to protect investors from fraudulent accounting practices.

While a nonprofit president may delegate certain tasks to others, the responsibility to make sure the corporation continues running efficiently, effectively, and legally ultimately rests with its president.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.