What is a “fiduciary duty” and who has it?

You are a soccer volunteer – you signed up to coach or be a team manager and now you have taken the next step to be a board member with your Club or Association.  You understand that with board member responsibility comes fiduciary responsibility.  The word fiduciary is used a lot when talking about nonprofit boards, but what does it really mean?

In any organization that you work or volunteer with you have a duty to serve the best interests of the organization. We see that as a natural part of our service, but serving on a non-profit board requires this in the form of fiduciary duties, and serving on a board within Washington Youth Soccer carries these duties as well.

Merriam-Webster Dictionary defines fiduciary as:
Fiduciary (noun): one that holds a fiduciary relation or acts in a fiduciary capacity
Fiduciary (adjective): of, relating to or involving a confidence or trust

So, what is a fiduciary? You! You are elected to serve on your Club or Association’s board of directors in order to act in the best interests of your soccer organization.  John Murphy, US Youth Soccer member-at-large, defines fiduciary as: “a person who has a duty to act on behalf of and for the benefit of another with the utmost in good faith, loyalty, candor, and care.”  As soon as you are elected to your Club or Association’s board of directors, you are trusted as a fiduciary of your Club or Association to carry out the business of the organization in the best interest of the organization, above any personal interests.

What does fiduciary duty entail? It means acting in good faith to make decisions that benefit the organization as a whole and not any one person or group. The State of Washington has put together a handy guide for board members of charities and nonprofits in Washington State and has made it available for free on the Secretary of State website as a PDF.  This 10 page resource gives a great overview of nonprofit board responsibilities and practices for being a productive board member.   I recommend sharing it with your fellow board members and anyone else you know involved in nonprofits. 

There are some structures in our organization that fiduciary responsibility is particularly important.  For example, many boards have members elected to represent a specific Club or program; fiduciary duty requires that all board members act for the benefit of the whole, even if they were elected by a specific group.

For instance, your Association is voting a new rule that might negatively impact your Club that elected you to the Association board, but the rule will positively impact the Association as a whole. Your duty is to uphold the best interests of the entire Association and if you believe in good faith that the rule is to the benefit of the whole Association, you should vote for the rule that may negatively affect your Club.

Fiduciary duty also requires the disclosure of any actual, potential, or perceived conflict of interest that may exist for a board member.  Being mindful of fiduciary responsibilities and ensuring all board members are fully briefed on what it entails is an important part of protecting both our organizations and volunteers. 

How have you exercised your fiduciary duty recently on your board? Feel free to submit your stories in the comments section below.

Coming up: We’ll explore how conflicts of interests can occur in youth soccer in our next post.

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About Hillary Beehler

I'm the Organization and Member Services Director for Washington Youth Soccer, the US Youth Soccer charter association for the State of Washington. WA Youth Soccer serves over 125,000 registered players across all levels of play, from Under 5 to Under 19.
This entry was posted in Board Resources, Policy. Bookmark the permalink.

4 Responses to What is a “fiduciary duty” and who has it?

  1. Pingback: Conflict of Interest |

  2. Pingback: How We Can Help You: An Overview of WA Youth Soccer Departments |

  3. Pingback: What Can Your Board of Directors Do to Reduce Financial Risk? |

  4. Pingback: Nonprofit Board Lesson #1: Remember Your Responsibilities |

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