As defined by Oxford Languages, ethics are moral principles that govern a person's behavior or the conducting of an activity.
Myriad courtrooms, board rooms, congressional settings, and online forums what seems like a never-ending string of ethical quandaries. Non-profit common interest communities governed by volunteers are certainly not immune. It's important to remember that requirements established by law (federal, state or local) and/or by an organization's governing documents usually fail to identify strict ethical boundaries and often lack specific consequences for ethical blunders. Furthermore, ethical compliance requires accountability and accountability requires human beings to confront one another about their actions and/or lack of action and execution. A code of ethics is only as good as the people governing your organization. Even clear violations of law must be enforced by someone. Misconduct by volunteer directors is sometimes resolved only by lack of re-election or by a removal vote of the members (owners).
Many volunteer board members seem content to conduct business according to their own flexible ideas of what's right and wrong instead of abiding by statutes, governing documents and ethical codes. That kind of "situational rationalization" often creates serious challenges whereby attempts to to perform due diligence, adhere to statutes, governing documents and ethical standards is gets labeled as "difficult," "meddling" and/or "micro-managing" (view article after article) and flagged as its own behavior to avoid. Taking appropriate action is incredibly challenging when an organization fails to acknowledge, confront and correct unethical behavior. Subscribing to ethics as a volunteer Board member requires rigorous honesty. That means telling the truth even when it's easier to lie or withhold information.
Doing what's right is not always popular and doing what's popular is not always right. - Anonymous
Follow your North Star by Steve Spanier discusses several requirements from CA's Davis-Sterling Act, but delivers a fantastic lens with which to consider ethical conduct. Here's an excerpt:
...a board member's North Star is found in the answer to a simple question: "What is best for the community?"
If board members focus on that, their jobs become relatively straightforward. They don't make decisions based on their own personal interests or the interests of their friends or neighbors. They don't make decisions based on what's least likely to create conflict or controversy. They don't make decisions based on what's expedient or easy...
Leading with reason, empathy, honesty, integrity, and transparency (open meetings, access to records, satisfaction surveys, etc.) proactively builds a healthy community. Ethical behavior also supports inclusion, equality and nondiscrimination. Great leaders find ways to actively include all homeowners in their community.
Ethical business practices and decision-making are distinct, yet related to Board Member duty of care / standards of conduct.
In addition to incorporating a code of ethics into your Bylaws (see example below), Bylaws Words of Wisdom contains several helpful passages relating to ethical behavior. Also view Decision-Making 101.
Only the Board Makes Decisions
Individual Board Members cannot make decisions for the Board. Verbal assurances from individual Board Members are not representations of the Board.
Actions of the Board must be reflected in the approved Board Meeting Minutes, or in other direct written communication from the Board.
The Board of Directors may, from time to time, appoint Directors to act as liaisons to the Managing Agent, committees, special projects and other endeavors of the Association. Any Director who acts as a liaison for the Board shall be appointed to do so by action of the Board and shall perform his or her duties in an impartial manner to convey the decisions and opinions of the Board. Board Liaisons shall not act unilaterally to exercise powers reserved to the Board except where the exercise of those powers conveys the decisions of the Board, or has been specifically delegated to them by Board resolution.
To the extent required by RCW 64.90.410, and subject to all limitations now or hereafter included as part of that statute, in the performance of their duties, members of the Board of Directors must exercise the degree of care and loyalty to the association required of an officer or director of a corporation organized, are subject to the conflict of interest rules governing directors and officers, and are entitled to the immunities from liability available to officers and directors under chapter RCW 24.06. No Director, whether acting alone or in concert with others, shall act to discharge the powers and authority of the Board in any manner inconsistent with the Association’s governing documents and/or any applicable governmental mandates.