Standard 3: Board Accountability
The land trust board acts responsibly in conducting the affairs of the organization and carries out the board’s legal, financial and other responsibilities in an ethical manner.
Background
Volunteers serve on a board for many reasons, but most often because they enjoy working with others to carry out the mission of the organization. The board has legal and ethical responsibilities to maintain the public’s trust and the land trust’s credibility. Every board member must understand these responsibilities. A board member who does not properly fulfill such duties or responsibilities may incur personal liability. To fulfill their duties, board members must become knowledgeable about their duties and responsibilities and the activities of the organization. A person who is not able to assume the responsibilities of a board member should not be on the board, but could serve the land trust in some other way.
Relevant Law
- Income Tax Act, SC 1985, c. I, s. 149.1 (6.3);
see also Canada Revenue Agency policy interpretations at
- Society Act, RSBC 1996, c. 433, s. 27.
- Canada Corporations Act, RSC 1970, c. C-32.
- Society Act, RSBC 1996, c. 433.
- Canada Corporations Act, RSC 1970, c. C-32.
PRACTICE
F. Board Approval of Land Transactions
The board reviews and approves every land and conservation agreement transaction, and the board is provided with timely and adequate information prior to final approval. However, the board may delegate decision-making authority on transactions if it establishes policies defining the limits to that authority, the criteria for transactions, the procedures for managing conflicts of interest, and the timely notification of the full board of any completed transactions, and if the board periodically evaluates the effectiveness of these policies.
Background
Land transactions are the primary business of a land trust. Because they often represent substantial costs, both in acquisition and in future management, the board should seriously consider its ultimate fiduciary responsibility when considering land projects. As such, the board should be informed about the land trust’s potential land transactions and must have the opportunity to act on all land transactions. In most land trusts, the full board reviews and approves every land transaction. In certain circumstances (mostly for large staffed organizations), after careful consideration and where consistent with applicable provincial law, the board may choose to empower a committee or staff to act on behalf of the board. In such cases, the board should adopt policies that clearly describe the overall objectives of the organization’s land transactions and define the committee or staff’s scope of authority, particularly in situations that may involve a conflict of interest. The board should regularly evaluate the effectiveness of such a process and monitor compliance with all limitations. If approval is delegated, the full board should be notified promptly of each transaction.
Assessment Questions
BC Assessment Questions
- Is every land acquisition and conservation covenant transaction reviewed and approved, prior to finalization, by the board or an empowered committee?
- Is the board, or an empowered committee, provided with sufficient information and advance notice to review and/or approve the above transactions?
- Does the land acquisition and/or covenant committee promptly notify the board and provide necessary information on the above transactions?
- Does the board periodically (e.g., every 1-2 years) evaluate its policy with respect to transactions, land acquisition, committees, and conflict of interest, and make amendments as necessary?
CLTA Assessment Questions
- Describe the procedure the land trust uses to provide information to the board and obtain board approval of transactions.
- Transaction approval authority may be delegated to a committee or staff only after the board has adopted specific policies establishing the parameters of and limitations on that authority.
Has the organization adopted such policies?- If yes, does the full board receive timely notification of every transaction?
- If yes, are these policies evaluated periodically?
