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Q&A #167 – Does the Board of Directors have a responsibility to review staff policies?
The chief executive of a nonprofit organization usually has the primary responsibility for managing staff and human resources issues, including the development and implementation of most employee handbook policies. With some exceptions, nonprofit Boards are not expected to review and approve staff policies, but the Board’s oversight role includes a duty to take reasonable steps to confirm these policies are in place and updated periodically.
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VIDEO Q&A for Subscribers: September 2024 [SUBSCRIBERS-ONLY]
Ben and Mike answer questions from subscribers about whether nonprofit organizations should require employees and Board members to provide receipts for small dollar expense reimbursements, tips for properly using executive sessions in Board of Directors meetings, and issues raised by nonprofits providing capacity building support to other nonprofits.
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TEMPLATE: Code of Ethics [SUBSCRIBERS-ONLY]
A Code of Ethics is one of the fundamental governance policies that all nonprofit organizations should have, and an important complement to your organization’s conflict of interest policy. This Code of Ethics template is intended to help your organization identify and express the core principles and ethical requirements with which all Board members, staff, and other individuals who serve and/or represent the organization are expected to comply.
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VIDEO Q&A for Subscribers: June 2024 [SUBSCRIBERS-ONLY]
Ben and Mike answer questions from subscribers about the responsibility of a Board of Directors to fill vacancies and how vacancy appointments count towards term limits, the Board's responsibilities regarding the use of large unexpected gifts and bequests, whether Board service can be reported as an in-kind contribution, and the distinction between policies and procedures that apply to Board and the staff.
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TEMPLATE: Current Operating and Intermediate Funds Cash Management Guidelines [SUBSCRIBERS-ONLY]
This Cash Management Guidelines template is designed to help your organization set targets the management of both current operating funds and intermediate funds, establish investment guidelines consist with your organization’s cash management needs.
Why Gift Acceptance Policies are Important and Must Be Periodically Reviewed and Updated
A gift acceptance policy fills many important roles for a nonprofit organization, including acting as a set of guidelines for fundraising efforts, a tool for risk management, and a protector of the organization’s good governance practices, mission, ethics, reputation, and culture. These characteristics are naturally sensitive to unexpected change and evolving economic conditions, so regularly reviewing and updating your organization’s gift acceptance policy is essential.
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VIDEO PODCAST: The Downsides of Board “Give or Get” Policies [SUBSCRIBERS-ONLY]
Mike and Ben discuss Board giving policies, including why nonprofit organizations have them, the components of a formal Board giving policy, and the often overlooked complications and negative consequences of Board giving policies with a "give or get" option.
The Case Against Board “Give or Get” Policies for a Nonprofit Organization
For nonprofit organizations, especially public charities, individual Board member giving is almost always a sensitive subject. Board giving is usually an important benchmark for nonprofits and frequently is treated as a “badge of honor” when an organization can report that 100% of its Board members have made an annual contribution. Board “give or get” policies may help some organizations reach Board giving goals, but they are complex and often hard to enforce, quantify, and manage.
Q&A #154 – Are nonprofits required to have a document retention and destruction policy?
Sections 802 and 1102 of the Sarbanes-Oxley Act generally prohibit all persons, including nonprofit organizations, from destroying, falsifying, or otherwise modifying records to obstruct a federal proceeding or investigation. There is no specific requirement under federal law to have a document retention and destruction policy (sometimes called a record retention policy), but having one is a recommended best practice to prevent violations of this law and to demonstrate the organization’s commitment to transparency and accountability.
Q&A #153 – Are nonprofits required to have a whistleblower policy?
Section 1107 of the Sarbanes-Oxley Act prohibits all persons, including nonprofit organizations, from knowingly retaliating against certain whistleblowers. There is no specific requirement under federal law to have a whistleblower policy, but having one is a strongly recommended best practice to prevent violations of this law and to demonstrate the organization’s commitment to transparency and accountability.
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How Intermediate Cash Fund Pools Support Long-Term Investment Portfolios [SUBSCRIBERS-ONLY]
Nonprofit organizations should expand their cash management policies and procedures to include provisions for establishing and maintaining intermediate cash fund pools. This will not only enhance protection and management of operating (short-term) cash funds, but also act as a conservative buffer for long-term investment strategies, allocation targets, and portfolio risk management.
Q&A #125 – Are in-kind contributions by Board members considered conflict of interest transactions?
Nonprofit conflict of interest policies are generally aimed at ensuring the organization’s assets are not used to provide excessive benefit to the people who run the organization. While purely donative arrangements (such as providing free office space to the organization) are not typically considered conflict of interest transactions, it is best to err on the side of full disclosure and review by independent Board members because individuals sometimes benefit from these transactions in ways that are not immediately apparent.
Three Steps to Be Better Prepared for Public Disclosure Requests
How a nonprofit organization responds to public disclosure requests provides a clear window to its commitment to accountability and transparency. However, many organizations are insufficiently prepared to respond to requests for documents. This can lead to compliance failures and/or inadvertently sharing sensitive information that was not required to be disclosed.
VIDEO: Establishing a Cash Management Target Policy | 5-Minute Lessons 4 Nonprofits
SE4N's A. Michael Gellman provides a short lesson on cash management target policies for operating and intermediate cash funds.
The Importance of Operating and Intermediate Cash Management Target Policies
Establishing operating and intermediate cash management target policies will provide many benefits. This simple but often overlooked cash management best practice will augment internal accounting controls, boost cash management awareness, and enhance perceptions that nonprofit organization management systems are significant and robust.