Bodies of the family foundation – governance and supervision of the family foundation

GENERAL PROVISIONS

Regardless of the body in question, the Act sets out general provisions for members of each of the aforementioned bodies, in particular concerning:

• the term of office of a member of a body – unless otherwise provided for in the articles of association, a member’s term of office is calculated in full financial years,
• consent to serve as a member of the body – in writing,
• the organisation of the work of a multi-member body – the duty to organise work properly,
• the venue of meetings – unless otherwise provided for in the articles of association, meetings shall be held at the family foundation’s premises,
• convening meetings of the family foundation’s body – as a rule, the chairperson convenes the meeting, either on their own initiative or at the request of a member of the body; furthermore, the date, time and venue of the meeting, as well as the proposed agenda, must be specified,
• adoption of resolutions – a resolution may be adopted if all members of that body have been duly notified of the meeting or the vote.

Furthermore, the general provisions also contain regulations concerning the possibility of remote participation in meetings of a given body and the openness of voting.

THE BOARD

One of the bodies provided for by the regulations on family foundations is the management board. As a body, the management board is, as a rule, appointed for a three-year term, and its members may be appointed for subsequent terms. The management board may consist of one or more members, who must be natural persons with full legal capacity and must not have been convicted by a final judgment for so-called economic offences, i.e. those specified in Articles 228–231 and in the provisions of Chapters XXXIII–XXXVII of the Criminal Code. A person appointed as a member of the Management Board may not simultaneously be a member of the Supervisory Board.

The tasks of the Management Board include:

1. managing the affairs of the family foundation and representing it;

2. implementing the objectives of the family foundation as set out in the Articles of Association;

3. undertaking activities related to ensuring the financial liquidity and solvency of the family foundation;

4. creating, maintaining and updating the list of beneficiaries in accordance with the law and the statutes;

5. informing the beneficiary of the benefit to which they are entitled;

6. fulfilling the benefit to which the beneficiary is entitled.

The provisions of the Family Foundation Act also set out the rights and obligations of a board member. A board member is required to act with due diligence, loyalty and confidentiality (even after the expiry of their term of office) and to manage the foundation’s affairs jointly. The powers of a board member include representing the family foundation in all judicial and extrajudicial proceedings (in the case of a multi-member board, as a rule, two board members jointly) and receiving remuneration.

SUPERVISORY BOARD

The supervisory board, as with the regulations governing limited liability companies, is, as a rule, an optional body. However, the legislator provides for a requirement to establish it when the number of beneficiaries exceeds 25 persons. Like the management board, it may consist of one or more members. The term of office of a member of the Supervisory Board is, as a rule, 5 years, with the possibility of re-election.

It exercises supervisory functions over the management board with regard to compliance with the law and the provisions of the articles of association. Additionally, the articles of association may extend the powers of the supervisory board, in particular by stipulating that the management board is obliged to obtain the consent of the supervisory board before carrying out a specific action.

BENEFICIARIES’ MEETING

The bodies of a family foundation also include the beneficiaries’ meeting. The beneficiaries’ meeting is composed of beneficiaries who have been granted the right to participate in it under the articles of association. The beneficiaries’ meeting is established by the founder in the articles of association and is, as a rule, convened by the management board. Unless the articles of association provide otherwise, the beneficiaries’ meeting is valid regardless of the number of votes represented at it.

The provisions of the Act set out a list of rights and obligations for the beneficiaries’ meeting, which include:

• the right to convene a meeting of beneficiaries in the event of the founder’s death and the absence of a supervisory board, as well as where the founder is not authorised to appoint a management board, if, as a result of the death of a management board member, no seat on the management board would be filled,
• the beneficiary who requested the convening of the beneficiaries’ meeting has the exclusive right to cancel that meeting.
• The beneficiaries’ meeting shall adopt resolutions on the appointment or dismissal of members of the management board or supervisory board, provided that at least half of its members participated in the meeting or vote.
• A beneficiary may attend the beneficiaries’ meeting and exercise their voting rights in person or through a proxy – the power of attorney must be in writing, otherwise it shall be null and void.

Resolutions of the beneficiaries’ meeting require the examination and approval of the foundation’s financial statements for the previous financial year, the granting of discharge to members of the governing bodies for the performance of their duties, the distribution or appropriation of the net financial result, the selection of an audit firm where the financial statements are subject to audit, and other matters specified in the Act or the Articles of Association.

Members of the management board, the supervisory board and the liquidator shall be liable to the family foundation under civil law to the extent that they cause damage through conduct contrary to the law or the statutes.

Author

Martyna Dobkowska

Associate

She specializes in civil, commercial and business law. In the corporate and energy department, her activities are mainly based on providing corporate services to companies, reviewing and preparing commercial contracts, drafting litigation and non-litigation pleadings and preparing analyses and legal opinions, particularly in the sphere of business law and energy law. She also has professional experience in administrative and civil proceedings, which she gained in Warsaw law firms. She supports the Firm's…

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