September 5, 2013

Do You Have These 6 Essential Policies?

BoardSource, a national organization focused exclusively on good governance practices, has four e-books with policy samples in 48 topic areas. You could, if motivated, keep your board busy writing policies for years. Does your nonprofit need forty-eight policies to operate? Most likely not. Here is my list of six areas where policies or written documents are must-dos.

1. Strategy and Plan

While these two are often linked, a strategy and a plan are different. A strategy is a conceptual framework for reaching your goals, the infrastructure you will build upon, how you will win. The concept originated with the military. Generals designed strategies to win battles and, eventually, the war. Your strategy will build on your skills, gifts and reduce your shortcomings.

In contrast, your plan is a specific list of sequenced activities, based on your strategy, to complete this month, quarter, or year. It focuses on what’s next.

2. Fundraising Plan

Does your budget include donated funds? If yes, you need a fundraising plan. Why do you need this plan in addition to an organization plan? Like an abridged version of an essay, most organizations’ plans lack the details you need to form or grow relationships with individuals, foundations, and corporations and set priorities for fundraising.  A fundraising plan fleshes out a clear road map to these donations. Your fundraising plan can call for the development of a board contribution policy if you don’t have one.

3. Needs List

From the point of view of the community impact, what are your three top-five needs this year? Since you might choose from many possibilities, this list reflects your priorities. When adopted by your stakeholders, you encourage everyone to focus on fulfilling these critical goals. While this is not a long-term policy, your board could wisely decide to generate a policy to create a top needs list each year that is shared with all stakeholders.

4. Conflict of Interest

Is it okay for a board member to sell their pottery or photographs in your gallery? Is it acceptable for you to invest your endowment funds at a board member’s firm? A conflict of interest policy helps you to sort out potential conflicts before they happen. You establish clear expectations, and a conflict of interest policy is a tool that builds board and donor trust.

 5. and 6. Leadership Policies

You need two documents here: a board selection criteria policy and a CEO succession plan. The board selection criteria identify the leadership skills your nonprofit seeks. The criteria downplay personalities from the discussion. A CEO succession plan requires you to hold awkward conversations with your board to create contingency plans. Just like planning for your estate, it’s planning done to help those left behind.

There you have it—six key policies and documents instead of forty-eight. To get started, seek out examples of each online. Then adapt them. Don’t just copy others.  Seventy-five percent of the benefit of developing any policy or written documents arises from the discussions your board and others have as they create them. Developing policies demand that you ask and discuss essential questions, and the remaining value comes from using them.

For more answers, check out this Nonprofit  CEO Library.

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Karen Eber Davis

Karen Eber Davis provides customized advising and coaching around nonprofit strategy and board development. People leaders hire her to bring clarity to sticky situations, break through barriers that seem insurmountable, and align people for better futures. She is the author of 7 Nonprofit Income Streams and Let's Raise Nonprofit Millions Together.


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