Exempt Organizations Advisory - Independent Sector Releases Governance Guide for Nonprofits

By: Catherine W. Wilkinson (cwilkinson@steptoe.com)
Suzanne Ross McDowell (smcdowell@steptoe.com)

On October 18, the Panel on the Nonprofit Sector, convened by Independent Sector, released its Principles for Good Governance and Ethical Practice: A Guide for Charities and Foundations.   The Guide, which was developed by the Advisory Committee on Self-Regulation of the Charitable Sector, outlines 33 principles designed to “support board members and staff leaders of every charitable organization as they work to improve their own operations.”  
The Guide, which summarizes the more comprehensive Reference Edition, organizes the principles into the following four main categories:

1. Legal Compliance and Public Disclosure (principles 1-7): responsibilities and practices, such as implementing conflict of interest and whistleblower policies, that will assist charitable organizations in complying with their legal obligations and providing information to the public;
2. Effective Governance (principles 8-20): policies and procedures a board of directors should implement to fulfill its oversight and governance responsibilities effectively;
3. Strong Financial Oversight (principles 21-26): policies and procedures an organization should follow to ensure wise stewardship of charitable resources; and
4. Responsible Fundraising (principles 27-33): policies and procedures organizations that solicit funds from the public should follow to build donor support and confidence.
   

IRS Issues New Compliance Guides for 501(c)(3) Public Charities and Private Foundations
On October 19, the IRS publicized two specialized publications for public charities and private foundations which provide an overview of activities that could jeopardize exempt status as well as information on recordkeeping, reporting and disclosure compliance requirements.