If you are considering accepting an invitation to become a member of board, you are probably wondering what the difference is between being a member of an organization and serving on the board of an organization? This is a similar question to the difference between being a shareholder and being a director of a for profit organization.
Non-profit organizations have members and for-profit organizations have shareholders. If you own shares of Scotiabank you do not have to be involved in the strategic planning at the bank. If Scotiabank had bills they could not pay, no one is going to ask you to pay the banks bills. The shareholders are not liable to pay creditors simply by owning shares in a for-profit organization.
This is not always the case with directors. A director can be held personally liable to pay amounts that are owing to Canada Revenue Agency for source deductions and sales taxes, under certain conditions. The difference between being a member or shareholder of an organization and being a board member is one of responsibility. A director can be held responsible for the actions of the organization and a regular member or shareholder cannot.
If you do decide to become a board member, make sure that you understand your responsibilities.
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