D4C Duty of Loyalty Policy

Purpose 

This policy outlines the duty of loyalty owed by the members of the Board of Directors of District 4 Coalition and establishes procedures for addressing conflicts of loyalty. 

Duty of Loyalty 

Every Director serving on a D4C’s Board of Directors owes a duty of loyalty to the organization. This duty is codified in Oregon’s Nonprofit Corporation Act, which provides that directors must discharge their duties “in a manner the director reasonably believes to be in the best interests of the corporation.”  Directors – when voting, making decisions, or otherwise acting on behalf of D4C – must place the interests of the organization above: 

1. Their personal interests; 

2. The interests of relatives, friends, or partners; 

3. Their business or financial interests; and 

4. The interests of other organizations they serve or represent. 

Conflicts of Loyalty 

A conflict of loyalty may arise when a Director owes duties of loyalty to more than one organization, and the best interests of this organization (i.e., D4C) conflict with those of another. Conflicts of loyalty do not involve a Director’s personal financial interest but may involve competing organizational missions, obligations, or expectations. 

Procedure 

When a conflict of loyalty arises, the Director must: 

1. Declare the conflict of loyalty; 

2. Explain its nature; 

3. Refrain from influencing any deliberations and any vote; 

4. Abstain from voting. 

The conflict and related actions must be documented in the meeting minutes. 

Compliance 

Failure to comply with this policy may constitute a breach of fiduciary duty under Oregon’s Nonprofit Corporation Act and may subject the Director to removal from the Board.