Our guest blogger Jim Stoynoff is a strategic advisor, consultant and business mentor as well as the President and Founder of Synthesis Solutions. He helps business and non-profit teams excel at their mission and grow, focusing on Strategic Direction, Leadership Alignment, Operational Efficiencies, Solution Design, Program Implementation, and Social Enterprise. Learn more about best practices in non-profit management on the Synergies Blog or follow him on LinkedIn.
Read the first four posts on Hallmark #1: Mission and Program; Hallmark #2: Leadership and Governance; Hallmark #3: Strategy and Innovation; Hallmark #4: Human Resources; and Hallmark #5: Financial Strength and Performance; and Hallmark #6: Resource Generation and External Relations. These posts also appear over at www.synthesis.biz/synergies.
This post–the final in the seven part series–addresses Accountability and Integrity and provides insights and resources to help your organization excel in these important areas.
For each Hallmark, the award review committee uses a set of underlying performance criteria to identify exemplary management. For Accountability and Integrity the criteria are:
- Organization provides the public with information about its mission, program activities, and finances and is accessible and responsive to members of the public who express interest in its affairs.
- Organization has policies in place and routinely and systematically implements these policies to prevent actual, potential, or perceived conflicts of interest.
- Organization is moving to increase its understanding of risk (i.e. appropriate insurance coverage, financial internal controls, managing employee and volunteer liabilities, etc.).
- Organization periodically conducts an internal review of its compliance with existing legal, regulatory, and financial reporting requirements.
Here are some insights and actionable steps for addressing points 1-4 above:
1. Transparency is key to earning the confidence and respect of donors and other stakeholders. See how Chicago Community Loan Fund, 2014 winner of the Alford-Axelson Award for Nonprofit Managerial Excellence in the Large Category) andThe Cara Program both share information publicly on mission, program impacts and financial performance. Also visit Charity Navigator to see the financial, accountability and transparency scores on thousands of nonprofits, as well as GuideStar , a source of similar information.
2. According to the National Council of Nonprofits, a policy governing conflicts of interest is perhaps the most important one a nonprofit board can adopt. Often people are unaware that their activities or personal interests may be in conflict with the best interests of the nonprofit so it’s important to raise awareness, encourage disclosure and discussion of anything that might be a conflict. See more information and a sample statement here: Conflict of Interest Statement. Implementing, documenting and periodically reviewing your conflict of interest policy should include board input and be reviewed by an individual who has legal experience (preferably a board member).
3. Establishing risk management controls encompasses several operational areas such as nonprofit financial management, insurance and human resources as well as others. Failure to fully address these risks can prove fatal for a nonprofit of any size. For detailed information and resources to address nonprofit risks visit these sites:
- Nonprofit Risk Management Center: www.nonprofitrisk.org
- National Council of Nonprofits: Nonprofit Financial Management
- Nonprofit Resource Center: www.nprcenter.org/risk-management
Be sure to have qualified board members assist in addressing your organization’s potential risks!
4. Simply establishing policies to address points 2 and 3 above is not enough. These important areas require periodic review by staff and the board to ensure that policies are being followed as prescribed and that they are still valid relative to changes in legal, regulatory and financial reporting requirements. It is essential therefore that your board includes members with experience in legal, accounting, human resources and insurance matters. Both staff and the board can also benefit from the resources and regulatory updates published by the Donors Forum.
Thank you all for following this 7-part series! I hope that you found value in the content, and please forward it to others in your nonprofit network. Let me know your suggestions for other topics to cover in this blog and feel free to call/e-mail me anytime for a free chat about any questions you may have.
All the best in 2015!
jstoynoff@Synthesis.Biz or (312) 920-1700
Tags: accountability, board of directors, Charity Navigator, Chicago Community Loan Fund, governing board, GuideStar, hallmarks, integrity, jim stoynoff, managerial excellence, National Council of Nonprofits, nonprofit, policies, resources, risk management, strategy, The Cara Program, transparency