110TH CONGRESS 
1ST SESSION H. R. 1681
AN ACT 
To amend the Congressional Charter of The American Na-
tional Red Cross to modernize its governance structure, 
to enhance the ability of the board of governors of The 
American National Red Cross to support the critical 
mission of The American National Red Cross in the 
21st century, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘The American Na-
tional Red Cross Governance Modernization Act of 2007’’. 
SEC. 2. FINDINGS; SENSE OF CONGRESS. 
(a) FINDINGS.—Congress makes the following find-
ings: 
(1) Substantive changes to the Congressional 
Charter of The American National Red Cross have 
not been made since 1947. 
(2) In February 2006, the board of governors 
of The American National Red Cross (the ‘‘Board of 
Governors’’) commissioned an independent review 
and analysis of the Board of Governors’ role, com-
position, size, relationship with management, govern-
ance relationship with chartered units of The Amer-
ican National Red Cross, and whistleblower and 
audit functions. 
(3) In an October 2006 report of the Board of 
Governors, entitled ‘‘American Red Cross Govern-
ance for the 21st Century’’ (the ‘‘Governance Re-
port’’), the Board of Governors recommended 
changes to the Congressional Charter, bylaws, and 
other governing documents of The American Na-
tional Red Cross to modernize and enhance the ef-
fectiveness of the Board of Governors and govern-
ance structure of The American National Red Cross. 
(4) It is in the national interest to create a 
more efficient governance structure of The American 
National Red Cross and to enhance the Board of 
Governors’ ability to support the critical mission of 
The American National Red Cross in the 21st cen-
tury. 
(5) It is in the national interest to clarify the 
role of the Board of Governors as a governance and 
strategic oversight board and for The American Na-
tional Red Cross to amend its bylaws, consistent 
with the recommendations described in the Govern-
ance Report, to clarify the role of the Board of Gov-
ernors and to outline the areas of its responsibility, 
including—
(A) reviewing and approving the mission 
statement for The American National Red 
Cross; 
(B) approving and overseeing the corpora-
tion’s strategic plan and maintaining strategic 
oversight of operational matters;
(C) selecting, evaluating, and determining 
the level of compensation of the corporation’s 
chief executive officer; 
(D) evaluating the performance and estab-
lishing the compensation of the senior leader-
ship team and providing for management suc-
cession; 
(E) overseeing the financial reporting and 
audit process, internal controls, and legal com-
pliance; 
(F) holding management accountable for 
performance; 
(G) providing oversight of the financial 
stability of the corporation; 
(H) ensuring the inclusiveness and diver-
sity of the corporation; 
(I) ensuring the chapters of the corpora-
tion are geographically and regionally diverse; 
(J) providing oversight of the protection of 
the brand of the corporation; and 
(K) assisting with fundraising on behalf of 
the corporation. 
(6)(A) The selection of members of the Board 
of Governors is a critical component of effective gov-
ernance for The American National Red Cross, and,
as such, it is in the national interest that The Amer-
ican National Red Cross amend its bylaws to provide 
a method of selection consistent with that described 
in the Governance Report. 
(B) The new method of selection should replace 
the current process by which—
(i) 30 chartered unit-elected members of 
the Board of Governors are selected by a non-
Board committee which includes 2 members of 
the Board of Governors and other individuals 
elected by the chartered units themselves; 
(ii) 12 at-large members of the Board of 
Governors are nominated by a Board committee 
and elected by the Board of Governors; and 
(iii) 8 members of the Board of Governors 
are appointed by the President of the United 
States. 
(C) The new method of selection described in 
the Governance Report reflects the single category of 
members of the Board of Governors that will result 
from the implementation of this Act: 
(i) All Board members (except for the 
chairman of the Board of Governors) would be 
nominated by a single committee of the Board 
of Governors taking into account the criteria
outlined in the Governance Report to assure the 
expertise, skills, and experience of a governing 
board. 
(ii) The nominated members would be con-
sidered for approval by the full Board of Gov-
ernors and then submitted to The American 
National Red Cross annual meeting of delegates 
for election, in keeping with the standard cor-
porate practice whereby shareholders of a cor-
poration elect members of a board of directors 
at its annual meeting. 
(7) The United States Supreme Court held The 
American National Red Cross to be an instrumen-
tality of the United States, and it is in the national 
interest that the Congressional Charter confirm that 
status and that any changes to the Congressional 
Charter do not affect the rights and obligations of 
The American National Red Cross to carry out its 
purposes. 
(8) Given the role of The American National 
Red Cross in carrying out its services, programs, 
and activities, and meeting its various obligations, 
the effectiveness of The American National Red 
Cross will be promoted by the creation of an organi-
zational ombudsman who—
(A) will be a neutral or impartial dispute 
resolution practitioner whose major function 
will be to provide confidential and informal as-
sistance to the many internal and external 
stakeholders of The American National Red 
Cross; 
(B) will report to the chief executive officer 
and the audit committee of the Board of Gov-
ernors; and 
(C) will have access to anyone and any 
documents in The American National Red 
Cross. 
(b) SENSE OF CONGRESS.—It is the sense of Con-
gress that—
(1) charitable organizations are an indispen-
sable part of American society, but these organiza-
tions can only fulfill their important roles by main-
taining the trust of the American public; 
(2) trust is fostered by effective governance and 
transparency, which are the principal goals of the 
recommendations of the Board of Governors in the 
Governance Report and this Act; 
(3) Federal and State action play an important 
role in ensuring effective governance and trans-
parency by setting standards, rooting out violations, 
and informing the public; 
(4) while The American National Red Cross is 
and will remain a Federally chartered instrumen-
tality of the United States, and it has the rights and 
obligations consistent with that status, The Amer-
ican National Red Cross nevertheless should main-
tain appropriate communications with State regu-
lators of charitable organizations and should cooper-
ate with them as appropriate in specific matters as 
they arise from time to time; and 
(5) while The American National Red Cross is 
and will remain a Federally chartered instrumen-
tality of the United States, and it has the rights and 
obligations consistent with that status, The Amer-
ican National Red Cross nevertheless should main-
tain appropriate communications and collaborations 
with local, community, and faith-based non-profit or-
ganizations, including those organizations that work 
within minority communities. 
SEC. 3. ORGANIZATION. 
Section 300101 of title 36, United States Code, is 
amended—
(1) in subsection (a), by inserting ‘‘a Federally 
chartered instrumentality of the United States and’’ 
before ‘‘a body corporate and politic’’; and 
(2) in subsection (b), by inserting at the end 
the following new sentence: ‘‘The corporation may 
conduct its business and affairs, and otherwise hold 
itself out, as the ‘American Red Cross’ in any juris-
diction.’’. 
SEC. 4. PURPOSES. 
Section 300102 of title 36, United States Code, is 
amended—
(1) by striking ‘‘and’’ at the end of paragraph 
(3); 
(2) by striking the period at the end of para-
graph (4) and inserting ‘‘; and’’; and 
(3) by adding at the end the following para-
graph: 
‘‘(5) to conduct other activities consistent with 
the foregoing purposes.’’. 
SEC. 5. MEMBERSHIP AND CHAPTERS. 
Section 300103 of title 36, United States Code, is 
amended—
(1) in subsection (a), by inserting ‘‘, or as oth-
erwise provided,’’ before ‘‘in the bylaws’’; 
(2) in subsection (b)(1)—
(A) by striking ‘‘board of governors’’ and 
inserting ‘‘corporation’’; and 
(B) by inserting ‘‘policies and’’ before 
‘‘regulations related’’; and 
(3) in subsection (b)(2)—
(A) by inserting ‘‘policies and’’ before 
‘‘regulations shall require’’; and 
(B) by striking ‘‘national convention’’ and 
inserting ‘‘annual meeting’’. 
SEC. 6. BOARD OF GOVERNORS. 
Section 300104 of title 36, United States Code, is 
amended to read as follows: 
‘‘§ 300104. Board of governors 
‘‘(a) BOARD OF GOVERNORS.—
‘‘(1) IN GENERAL.—The board of governors is 
the governing body of the corporation with all pow-
ers of governing and directing, and of overseeing the 
management of the business and affairs of, the cor-
poration. 
‘‘(2) NUMBER.—The board of governors shall 
fix by resolution, from time to time, the number of 
members constituting the entire board of governors, 
provided that—