Bill Text: NY A07039 | 2017-2018 | General Assembly | Introduced


Bill Title: Requires certificates of incorporation of not-for-profit corporations to include certifications that the initial directors of the corporation shall commit to the inclusion in the corporation bylaws of a conflict of interest policy and a requirement that the directors and officers of the corporation comply with education requirements regarding their fiduciary obligations to the corporation.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2018-01-03 - referred to corporations, authorities and commissions [A07039 Detail]

Download: New_York-2017-A07039-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          7039
                               2017-2018 Regular Sessions
                   IN ASSEMBLY
                                     March 29, 2017
                                       ___________
        Introduced by M. of A. TITONE -- read once and referred to the Committee
          on Corporations, Authorities and Commissions
        AN  ACT  to  amend  the  not-for-profit  corporation law, in relation to
          requiring certificates of incorporation of not-for-profit corporations
          to include certifications that the initial  directors  of  the  corpo-
          ration  shall  commit  to the inclusion in the corporation bylaws of a
          conflict of interest policy and shall include in the corporate  bylaws
          a requirement that the directors and officers of the corporation shall
          comply  with  education  requirements  regarding their fiduciary obli-
          gations to the corporation
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  Paragraph (a) of section 402 of the not-for-profit corpo-
     2  ration law is amended by adding two new subparagraphs 9 and 10  to  read
     3  as follows:
     4    (9) A certification that the initial directors of the corporation have
     5  included  in  the  corporate  bylaws,  and  will abide by, a conflict of
     6  interest policy which: (i) prohibits the directors and  executive  offi-
     7  cers  of  the  corporation  from being involved in decisions relating to
     8  business between the corporation and  any  other  not-for-profit  corpo-
     9  ration  of which the officer or director, his or her spouse or any other
    10  disqualified person is a director or officer;  and  (ii)  requires  each
    11  director  and  executive  officer  of  the corporation to certify to the
    12  corporation that he or she is not affiliated with another not-for-profit
    13  corporation which may do business with the corporation or, if he or  she
    14  is or becomes so affiliated, to promptly disclose to the corporation the
    15  existence  of  such  affiliation.  As  used herein "disqualified person"
    16  means the family of a director  or  executive  officer,  including  such
    17  person's  spouse,  parent, sibling, child, grandchild, great-grandchild,
    18  and the spouse of any sibling, child, grandchild or great-grandchild.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09211-01-7

        A. 7039                             2
     1    (10) A certification that the executive officers  of  the  corporation
     2  have  included in the corporate bylaws, and will abide by, a requirement
     3  that:  (i) the executive officers of the corporation shall,  within  six
     4  months  of  the  date  of  incorporation and every two years thereafter,
     5  attend  and complete a course, at least three hours in length, conducted
     6  by an attorney  or  certified  public  accountant,  which  course  shall
     7  instruct  such  officers in their fiduciary responsibilities as officers
     8  of the corporation; and (ii) that the  corporation  shall  maintain,  as
     9  part  of the corporate books and records, a record of the date, location
    10  and length of the courses attended by the executive officers,  including
    11  the  names  of  the  attendees,  the course presenter and the sponsoring
    12  education provider entity,  and  the  signatures  of  the  officers  who
    13  attended the program.
    14    § 2. This act shall take effect January 1, 2018.
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