Every nonprofit needs operational guidelines for staff and the board. The purpose of the policies is to serve as a guide for actions and behavior and as a reference for ethical decision making. Policies create parameters and boundaries to ensure consistent processes, to resolve difficult situations, and to eliminate ineffective operations. Policies can paraphrase a law, explain a procedure, clarify a principle, or express a desired goal. Without detailed policies it is difficult to solve conflict situations or deal with them in a fair and unbiased manner. With clear rules and regulations it is easier to avoid risky, detrimental, and hurtful actions.
The board is responsible for overseeing these policies are in place. It drafts its own policies and ensures the staff does the same for itself. The board is also responsible for ensuring all the policies:
- are regularly reviewed
- abide by the law
- promote moral behavior and organizational values
The main board policies are defined in the bylaws but as it is relatively cumbersome to amend this document, the bylaws should not contain very detailed clauses that require frequent fine-tuning. Separate polices should address issues that either clarify main bylaws clauses or are more procedural in nature and would simply clutter the legal document.
The policies must not be in disagreement with the bylaws of the organization, the articles of incorporation, nor state or federal statutes.