Principles for Good Governance and Ethical Practice

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.

33 Principles

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

Digital Resources

Principles digital resources support your organization’s efforts to understand and implement recommendations made in┬áthe 33 Principles.

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Partners

Publication and dissemination of the Principles was made possible through the generous support of:

  • The Andrew W. Mellon Foundation
  • Hogan Lovells
  • The James Irvine Foundation
  • Lilly Endowment, Inc.
  • Patterson Belknap Webb & Tyler LLP
  • Open Society Foundations
  • Otto Bremmer Foundation
  • The Wallace Foundation

Independent Sector works in collaboration with state nonprofit and philanthropic organizations to distribute co-branded versions of Principles across the country. Current co-branding partners include:

  • Florida Philanthropic Network
  • Hawaii Alliance of Nonprofit Organizations
  • Idaho Nonprofit Center
  • Michigan Nonprofit Association
  • Nonprofit Association of Oregon