The document outlines essential practices for new nonprofit leaders, including maintaining organizational charts and clear contact points for decision-making and crisis response. It emphasizes the importance of regularly reviewing legal documents, insurance coverage, and governance policies to ensure compliance and adequate risk management. Additionally, it advises establishing communication protocols and conflict of interest policies for directors to navigate potential legal challenges effectively.

1. 1.Createandmaintaineasyreferencechecklists/flowchartsfornewleaderstoinherit:
a)Organizaonalchartsarehelpfultonewboardmembers/leadersandrequirestructuralreview.
b)“Who’sonFirst”listsgivestructuretoregulardecision-makingandcrisisresponse.
c)CAUTION:Knowingwhotocallmaybebeerthanhavingapre-plannedresponse.
2.Knowandupdateyourcontactpointsperiodically(annually?withleadershipchanges?):
a)Who(person/enty/service)isyouragenttoreceiveserviceofprocess/officialnocesif
organizaonissubpoenaedorsued,etc.?Filedwiththestateagencies?
b)Determinewhospeaksfortheorganizaonpublicly(andwhoshouldnot)—haveaplan.
c)Alsoconsiderwhatshouldhappenwhenalawenforcementagent/otherofficialvisitorcomes
calling—ithappens!
d)Havedirectorssignaconflictofinterestpolicy,andbesuretheyalsounderstandduesofloyalty
andlimitsofauthoritywhendealingwithemployeesand3rdpares.
3.CarryandperiodicallyreviewyourDirectorsandOfficers(D&O)Insurancewithanexperienced
professionaltodeterminethatcoverageisadequatetocoverknownrisks.
4.Knowwhereyourgoverningdocuments,operaonaldocuments,andelectronicdocumentsand
informaonaremaintained,andwhomaintains/hasaccesstoeach.
5.Takealookat/updateyourgoverningdocumentsperiodically:
a)Areyoufollowingproceduresprescribedbyyourbylaws,etc.?Dotheyworkforyou?
b)Isyourmissionslltheonestatedinyourmissionstatement?
Avoiding/SurvivingLitigation:
BestPracticesforNonprofits
ByLauriE.Cleary|LitigationAttorney
lecleary@lerchearly.com
lerchearly.com