Contributed by Zac Parry
April is National Volunteer Month, an excellent time to celebrate the volunteers that help community associations thrive. Fiduciary duty is a critical component of successful volunteer leadership.
As a board member, fiduciary duty represents my responsibility to make sound decisions that allow my community to operate as outlined by our governing documents. An association board must consider their overarching charge, which can essentially be broken down into four tasks: follow and enforce governing documents; protect and maintain the common physical and financial property; collect assessments and ensure long-term planning; and build a sense of community.
How we do those jobs is governed by the concept of fiduciary duty. It governs every decision and every action a board takes. When a board is presented with an issue, I believe its members must ask several questions before making a decision:
❚ Is my decision based on what I want personally or what is best for the community as a whole?
❚ Am I fully informed about this issue?
❚ Have I had my questions satisfactorily answered?
❚ Will my decision allow for or interfere with the ability of the association to fulfill its obligations as set forth in the governing documents?
❚ Will my decision treat all owners equally?
In the beginning, it may be hard to adhere to your fiduciary duty. It can be counter to personal feelings and take diligent practice. There will be owners who will not like that you are attempting to run your community in its best interests. In the end, they will see every individual owner is best served if the board makes decisions based on their fiduciary duty.
Zac Parry is the former president of the Cobblestone Owners Association in Urbandale, Iowa.
>> Read more about fiduciary duty in Common Ground March/April 2025.
