Association board members often struggle with the Duty of Loyalty. Here’s a definition from our association attorney:
- The Duty of Loyalty dictates that officers and directors must act in good faith: A director shall avoid advancing their own personal interests in ways that may injure or take advantage of the Association. A director shall exercise honesty and must not allow his/her personal interests to prevail over the interests of the organization. The duty of loyalty has three key components: (1) the director must not usurp corporate opportunities for personal gain, (2) must avoid engaging in interested transactions without board approval, and (3) must maintain the organization’s confidential information.