What are the principles?

The Principles for Good Governance and Ethical Practice outlines 33 principles of sound practice for charitable organizations and foundations related to legal compliance and public disclosure, effective governance, financial oversight, and responsible fundraising. The Principles should be considered by every charitable organization as a guide for strengthening its effectiveness and accountability. The Principles were developed by the Panel on the Nonprofit Sector in 2007 and updated in 2015 to reflect new circumstances in which the charitable sector functions, and new relationships within and between the sectors.

DOWNLOAD A PDF SUMMARY OF THE 33 PRINCIPLES

SEE FUNDERS & MEMBERS OF THE 2014 COMMITTEE WHO MADE THIS UPDATE POSSIBLE



Legal Compliance and Public Disclosure

  1. Laws and Regulations
  2. Code of Ethics
  3. Conflicts of Interest
  4. "Whistleblower" Policy
  5. Document and Data Retention and Destruction
  6. Protection of Assets
  7. Availability of Information to the Public

Effective Governance

  1. Board Responsibilities
  2. Board Meetings
  3. Board Size and Structure
  4. Board Diversity
  5. Board Independence
  6. CEO Evaluation and Compensation
  7. Separation of CEO, Board Chair and Board Treasurer Roles
  8. Board Education and Communication
  9. Evaluation of Board Performance
  10. Board Member Term Limits
  11. Review of Governing Documents
  12. Review of Mission and Goals
  13. Board Compensation

Strong Financial Oversight

  1. Financial Records
  2. Annual Budget, Financial
    Performance and Investments
  3. Loans to Directors, Officers,
    or Trustees
  4. Resource Allocation for Programs
    and Administration
  5. Travel and Other Expense Policies
  6. Expense Reimbursement for
    Nonbusiness Travel Companions

Responsible Fundraising

  1. Accuracy and Truthfulness of Fundraising Materials
  2. Compliance with Donor's Intent
  3. Acknowledgment of Tax-Deductible Contributions
  4. Gift Acceptance Policies
  5. Oversight of Fundraisers
  6. Fundraiser Compensation
  7. Donor Privacy




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    The Books

    Digital Resources

    The Principles Resource Center is the gateway to online tools and resources that support charitable organizations in their implementation of the Principles. The Resource Center includes the full text of each of the 33 Principles, including explanation and rationale, key questions organizations should consider, and legal background information from the Legal Reference Edition of the Principles, as well as a database of more than 300 online resources from across the sector that support organizations in the implementation or adaptation of recommendations made in the Principles.



    Principle #3: Conflicts of Interest
    Screenshot of Resource Database Search
    Refining Search Results




    Co-Signers

    The Principles are broadly accepted by a wide range of organizations from across the nonprofit and philanthropic sector. Below are just a few of the co-signers who agree that the Principles, updated in 2015 by Independent Sector, provide a strong guide for private foundations and public charities that aspire to high standards of governance and ethical practice and who encourage the sector to examine these principles carefully and determine how best they should be applied to their own operations.



        • AARP
        • AMERICANS FOR THE ARTS
        • ASSOCIATION OF AMERICAN MEDICAL COLLEGES
        • ASSOCIATION OF FUNDRAISING PROFESSIONALS
        • BBB WISE GIVING ALLIANCE
        • BOARDSOURCE
        • CAMP FIRE USA
        • CAMPION FOUNDATION
        • COUNCIL ON FOUNDATIONS
        • DETROIT ZOOLOGICAL SOCIETY
      • GUIDESTAR USA, INC.
      • THE WILLIAM AND FLORA HEWLETT FOUNDATION
      • KPMG FOUNDATION
      • NATIONAL HEALTH COUNCIL
      • NONPROFIT ASSOCIATION OF OREGON
      • UNITED CEREBRAL PALSY
      • UNITED WAY WORLDWIDE
      • VIRGINIA TECH INSTITUTE FOR POLICY AND GOVERNANCE
      • THE WALLACE FOUNDATION
      • YMCA OF THE USA

     



    PRINCIPLES ORGANIZATIONAL ASSESSMENT TOOL

    The Principles Organizational Assessment Tool allows organizations to determine their strengths and weaknesses in the application of the Principles, based on its four key content areas (Legal Compliance and Public Disclosure, Effective Governance, Strong Financial Oversight, and Responsible Fundraising). This probing tool asks not just whether an organization has the requisite policies and practices in place, but also enables an organization to determine the efficacy of those practices. After completing the Principles Assessment (by content area or in full), organizations will receive a score report for each of the four content areas and recommendations via email for increasing their alignment with the Principles.



    BEGIN THE ASSESSMENT (ACCESS REQUIRED)





    What's New In the Principles

    In 2014, Independent Sector convened an advisory group of 21 sector leaders to review and update the Principles for Good Governance and Ethical Practice. The impetus for doing so was two-fold. First, seven years, since the publication of the Principles in 2007, the charitable sector has experienced many significant changes in the environment in which it works, and those changes have raised questions about whether the principles adequately addressed some of the emerging issues. Secondly, with such broad-based reliance on these principles, Independent Sector deemed it good practice to revisit the recommendations to be sure that their guidance remains relevant today.

    The advisory group recommended a series of updates that are reflected in this 2015 edition of the Principles. Some reflect changes in the law since the 2007 Principles were issued. Others reflect new circumstances in which the sector functions, and new relationships within and between the sectors.

    READ AN EXECUTIVE SUMMARY HIGHLIGHTING CHANGES IN THE 2015 EDITION

    SEE A PRESS RELEASE ON THE LAUNCH OF THE 2015 PRINCIPLES


    Key changes to the Principles can be found in the following areas:

        • CODE OF ETHICS AND "WHISTLEBLOWER" POLICIES
        • RISK TOLERANCE AND MITIGATION IN RESPONSE TO TECHNOLOGY ADVANCES
        • NONPROFITS TAKING UP NEW BUSINESS OR EARNED INCOME OPPORTUNITIES
      • THE TENSION BETWEEN INCREASING
        TRANSPARENCY AND PROTECTING PRIVACY
      • EXECUTIVE COMPENSATION
      • OVERHEAD COSTS
      • FUNDRAISING IN THE DIGITAL WORLD

     

    GET YOUR ACCESS NOW

    You can purchase print and digital copies of the Principles for Good Governance and Ethical Practice now, and pre-order access to the Principles Resource Center and the Principles Organizational Assessment Tool, available in early March. Select a product or bundle below and save on the latest edition of the key ethics and governance document for nonprofits and charities downloaded more than a quarter of a million times.



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