BYLAWS VS POLICY & PROCEDURE GOVERNANCE VS MANAGEMENT

OUR MANTRA BYLAWS = GOVERNANCE POLICY & PROCEDURE = MANAGEMENT

WHERE’S THE BEEF? BYLAWS DESCRIBE THE ORGANIZATION DETERMINE TOP LEVEL OF CORPORATE AUTHORITY (and RESPONSIBILITY) Articles of Incorporation (State Law) List of all immediately necessary corporate information Basic outline for constructing Bylaws DEFINE THE GOVERNANCE ROAD Who are we Why are we in business What is our governance structure

GOVERNANCE STRUCTURE Board of Directors Officers How many, how elected, terms of office, filling vacancies Qualifiers and Duties Meeting requirements Officers Titles, how elected, terms of office, filling vacancies Duties of each

MEMBERSHIP WHO MAY BE A MEMBER OF THE ORGANIZATION? Qualifiers Age is usually the only qualifier More an organizational descriptor than qualifier Member duties Keep current on your fees Don’t be disruptive Member privileges Opportunities to attend events Elect Board and (in most cases) Officers Approve Bylaws and amendments (?) Volunteer for roles from ad hoc duties to leadership

THE IMPLIED CONTRACT GOVERNING BODY SAYS TO THE MEMBERSHIP, WE WILL PROVIDE YOU WITH A SET OF BENEFITS MEMBERSHIP (TACITLY) SAYS TO THE GOVERNING BODY WE WILL TRUST YOU TO OPERATE IN OUR FAVOR

POINTS TO CONSIDER (and Remember) Bylaws are legally binding documents – know them Review your Bylaws at least annually Also, when systemic change happens or is desired Keep Bylaws to high-level matters Watch out for creep into Procedure Keep your Bylaws current, however, be alert for changes that may restrict future Boards

BOARD COMMITTEES Committees are the management arm of the Board Manage the operations of the organization’s intent Board’s information conduit to and from the membership Seek and enable volunteers At a minimum, consider Nominating Committee Finance Committee Curriculum Committee (production) Allow for ad hoc committees COMMITTEES GIVE THE BOARD THE INFORMATION AND TOOLS WITH WHICH TO MAKE GOVERNANCE DECISIONS

THAT’S THE REVIEW OF THE BYLAWS BASICS BYLAWS = GOVERNANCE IDENTIFY THE ORGANIZATION DEFINE ITS PURPOSE AND STRUCTURE CREATE AVENUES FOR COMPLETION OF ORGANIZATIONAL PURPOSE Bylaws define, construct, and enable governance to get the organization’s job done.

POLICY & PROCEDURE Board sets Policy, thereby helps define Procedure SO – NOW WE HAVE THREE TOOLS BYLAWS POLICY PROCEDURE

POLICY POLICY SETS THE FRAMEWORK FOR OPERATIONS GOVERNANCE LEVEL i.e. BOARD MEMBERS SHALL NOT PORFIT FROM THE ORGANIZATION’S BUSINESS TRANSACTIONS OR FROM INFORMATION OBTAINED DURING THE CONDUCT OF ORGANIZATION BUSINESS. OPERATIONAL LEVEL i.e. “PRESENTERS MAY NOT, DURING THEIR PRESENTATIONS, PROMOTE OR SELL PRODUCTS OR SERVICES FROM WHICH THEY BENEFIT”

POLICY GUIDELINES Mission oriented Purposeful Flexible Defines operational inclusions and limits for mission completion Purposeful Written with a definite purpose in mind, and in plain language Flexible Change happens everywhere Well communicated All stakeholders, all stakeholders, need access to Policy

IRS FORM 990 The “information return” required of tax exempt organizations Tax Exempt/Government Entities Commissioner (TE/GE) Head of the IRS division responsible for nonprofit oversight The 990 has become a very complex document and is still very much a work in progress Lists policies “suggested” for nonprofits, which do nicely as a policy checklist for service organizations

MINIMUM GOOD PRACTICE POLICIES A Mission Statement A Conflict of Interest Policy Code of Ethics Meetings documentation and document retention policy An expense reimbursement policy Gift acceptance policy A fundraising policy An investment policy

MORE on GOOD PRACTICE POLICIES Which Policies do you need A Whistleblower Policy – International grant-making policy – Debt collection – likely no Executive compensation policy

MORE POLICIES FROM IRS FORM 990 Or how about: Joint venture policy Affiliate policy Conservation easements policy The 990 speaks to many more… Use it as a guide References for information besides IRS publications The Panel on the Nonprofit Sector Evangelical Council for Financial Accountability (ECFA)

PROCEDURE General, or maybe in depth, ways to to do what the Bylaws and Policy want done. Purely operational Task specific Serve at least two ways: Offer ways to accomplish given tasks Serve to offer continuity for new members and leadership Must be fluid so as to accommodate better ways Allow changes at operational level – no Board action needed

POLICY vs PROCEDURE Policy defines the framework for operational activity Procedure serves to offer Policy-guided ways to actually do the tasks that the organization wants done Policy – The organization shall seek supplementary funding through appropriate fund development activities. Procedure – Contributors to the Annual Fund will use the prescribed form. Policy – Board and committee volunteers will not have to pay for parking in pursuit of their duties. Procedure – Parking tags will be supplied to volunteers for parking at our main building.

BYLAWS vs POLICY We have discussed that Bylaws define the structure and set the tasks for Governance And, Policy describes the framework for managing operations And, Policies may be general or more detailed, depending on the task How about some examples of Bylaws-to-Policy-to- Procedure

BYLAWS vs POLICY (cont.) A Bylaws provision at its minimum OLLI@UGA Standing Committees Bylaws list only the essentials The President appoints the chairs, with Board approval Certain documents are named for guidance Committee names are listed Everything else is found in committee Policy, and in Procedure

BYLAWS vs POLICY (cont.) Here’s a Bylaws article moving well into procedure OLLI@UGA wanted increased transparency in the officer/director nominating process Nominating Committee Bylaws article doubled in size Article split into two sections 1) Nominating Committee nomination and election 2) Nominating Committee general procedures Duties, time lines, report inclusions The Process description is complete in concept

BYLAWS = GOVERNANCE Bylaws constitute the prime document that describes and enables the organization The highest level of organizational documents Contain all the elements of governance structure A legal document, and an implied contract Bylaws should not speak to operational matters, either in process or in procedure Bylaws should offer to the entire organization freedom and opportunity to carry out the mission in the most efficient and effective manner

POLICY & PROCEDURE = MANAGEMENT Policy serves the Bylaws by setting the framework for accomplishing the organizational mission Policy can open up the mission We will accept for membership any one who wants to share in our mission Policy can define limits Presenters shall not sell their wares during class Procedure describes, in greater or lesser detail, the operational process for task accomplishment Purely operational, and specific to the task

SO, HERE’S THE BEEF Our Bylaws tell the world, and particularly our members, Who we are and what we intend to do, and How our governance process is established and organized in order to oversee accomplishment of our mission. Policy & Procedure define the ways and means AND, Governance and Management inform each other at many points along the way, and either can be changed by the necessities of the other.

Governance and Management must be a continuous loop In reality the equation is Governance & Management = Success Thank you, and Good Luck