§ 27-19.2-4 - Board of directors – Duties and functions of the board of directors.
SECTION 27-19.2-4
§ 27-19.2-4 Board of directors –Duties and functions of the board of directors. – (a) The board of a nonprofit hospital and/or medical service corporation andits individual members are fiduciaries and shall act at all times:
(1) In utmost good faith;
(2) In a manner reasonably believed to be in the bestinterest of fulfilling the corporation's mission or the mission of affiliatesor subsidiaries;
(3) In a manner reflecting undivided loyalty to thefurtherance of the corporation's charitable mission;
(4) At the highest standard of fiduciary care and prudence;
(5) In accordance with a conflict of interest policy adoptedby the board of directors that will be consistent with guidelines recommendedand published by the U.S. Internal Revenue Service for nonprofit entities; and
(6) Physicians who receive compensation from the nonprofithospital and/or medical service corporation, for services rendered in theirprofessional capacity, directly or indirectly, may serve on board committeesthat address compensation matters; provided, however, that no such physicianmember may participate in a vote or deliberate on matters relating to physiciancompensation.
(b) The proper and principal functions of the board shallinclude:
(1) Ensuring that the corporation effectively carries out thecharitable mission for which it was incorporated under § 27-19-2 of thistitle;
(2) Selecting corporate management and evaluating itsperformance in light of the corporation's charitable purpose;
(3) Recognizing that in the event of a conversion as definedin § 27-66-4(3), the reserves and assets with which they are entrusted arecharitable assets, and treating them with according stewardship;
(4) Establishing a system of board governance including anannual evaluation of board performance measured against the charitable purposeof the corporation; and
(5) Holding an annual public meeting with proper notice opento providers and subscribers at which comments shall be heard from the floor.