Principle Statement
A charitable organization should have a formally adopted, written code of ethics with which all of its directors or trustees, staff and volunteers are familiar and to which they adhere.
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Introduction
Adherence to the law provides a minimum standard for an organization’s behavior. Each organization should also have a code of ethics that outlines the practices and behaviors that its staff, board, and volunteers agree to follow. The adoption of such a code, though not required by law, helps demonstrate the organization’s commitment to carry out its responsibilities ethically and effectively. The code should be built on the values that the organization embraces, and should highlight expectations of how those who work with the organization will conduct themselves in a number of areas, such as the confidentiality and respect that should be accorded to clients, consumers, donors, and fellow volunteers and board and staff members.-
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The process by which a code of ethics is adopted and implemented can be just as important as the code itself. The board and staff should be engaged in developing, drafting, adopting, and implementing a code that fits the organization’s characteristics. It should then be complemented by policies and procedures that describe how the principles in the code will be put into practice. Organizations should include a discussion of the code of ethics in orientation sessions for new board and staff members and volunteers, and should regularly address adherence to the code in their ongoing work.
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Core Concepts
- Laws provide minimum requirements for boards and organizations to remain compliant.
- Ethical standards extend legal requirements—not just doing things right but doing the right thing.
- A code of ethics codifies the organization’s beliefs and values to which it aspires.
- A code of ethics provides a code of conduct for all those who work with the organization.
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Legal and Compliance Issues
• IRS Form 990 does not directly ask whether an organization has a code of ethics, but numerous questions relate to ethical standards and existence of policies. -
Legal Background
There is no legal requirement to have a code of ethics.(From The Principles for Good Governance and Ethical Practice: Reference Edition,
Published in 2007) -
Discussion Points
These questions – from the Principles Workbook (PDF) – are intended to prompt discussion about the principle, assess the polices and practices of your organization, and encourage your organization to take steps to identify where improvements should be made.
- Have we articulated and agreed on the values that drive our organization?
- What steps should we take to integrate our code of ethics into the culture of the organization? How have we ensured that directors, staff, and volunteers are familiar with our code of ethics?
- How well is our code of ethics reflected in the organization’s policies and procedures?
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Resources for Principle #2
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Related Principles
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Supplemental Materials
