The rule of prudence is the standard to apply for fiduciary duty of care decisions. The rule of prudence calls upon those invested with this duty to take actions that others in similar or like circumstances would take.
For nonprofit boards, there are decisions, policies if you would, that can certainly change the way the organization has worked for many years but prudence dictates this to be the correct decision. Such is the example of the New York State Dairy Exhibits. Read the article from the Wall Street Journal.
SYRACUSE, N.Y. — The dairy group that has run the popular Milk Bar at the New York State Fair since 1952 says it's pulling out because of funding issues with the Cuomo administration.
The nonprofit New York State Dairy Exhibits, Inc. tells The Post-Standard (http://bit.ly/2nDpgMg ) that it won't run the Dairy Products Building at the fairgrounds in suburban Syracuse.
Group leaders say the move comes after the state only came up with half of the $90,000 subsidy that was supposed to cover expenses for running last year's Milk Bar.
The state kicked in the funding after the group announced before the fair's opening that it planned to double the price of a cup of milk to 50 cents because it was losing money on the operation. The state money prevented the price from being raised for the first time since 1983.
Information from: The Post-Standard, http://www.syracuse.com