Nina J. Crimm (St. John’s) has published a letter to the editor in this week’s Chronicle of Philanthropy, How to Avoid Scandals: Online Training for Trustees:

The Chronicle of Philanthropy and other news organizations repeatedly report stories involving conflicts of interest, financial scandals, and other abuses of fiduciary duties by charities’ board members. …  [A] considerable proportion of these breaches of fiduciary duties are by inexperienced or untrained board members who have admirable intentions.

Because many charities are small, have little money for legal advice, and often have novice, volunteer board members, their board members are particularly susceptible to inadvertently violating their fiduciary responsibilities. More often than not, those board members lack a comprehensive appreciation of their fiduciary duties, relevant state (nontax and tax) and federal (tax) laws, and these laws’ application in the everyday scenarios encountered. … I have a modest proposal.

State attorneys general, knowledgeable charity leaders, academics, and practicing lawyers should join together to develop a Web-based training course providing a comprehensive package of useful lessons that board members of charities need to master to properly fulfill their fiduciary functions throughout charities’ life cycles. (Where state laws differ, a portion of the material could be tailored to account for the variation.) Development of the training course might be underwritten financially by insurance companies that provide director and officer liability policies and that stand to benefit economically in the future if more-knowledgeable board members translate into lower payouts.