Panel on the Nonprofit Sector Releases
Report on Good Governance and Ethical Practice

(Washington, D.C., October 18, 2007) -- The Panel on the Nonprofit Sector, a national panel to improve accountability and ethical practice in charitable organizations, today released its Principles for Good Governance and Ethical Practice: A Guide for Charities and Foundations. The Guide represents the first time that charities and foundations reflecting a broad cross-section of the American nonprofit community have come together to develop principles of ethical conduct, accountability and transparency that they aspire to and encourage all organizations to follow.

The Guide is the result of 18 months of work by expert and practitioners from across the nonprofit community. In 2006, the Panel formed the Advisory Committee on Self-Regulation of the Charitable Sector, comprised of 34 leaders from charities, foundations, and academic institutions. Chaired by Joel L. Fleishman, professor at Duke University, and Rebecca W. Rimel, president and CEO of The Pew Charitable Trusts, the Advisory Committee studied more than 50 existing self-regulation systems to develop principles that could benefit all nonprofit organizations. The Panel drew on these recommendations, as well as hundreds of comments on draft versions of these ideas, to develop the Guide.

“The Panel on the Nonprofit Sector worked with an outstanding advisory committee and hundreds of foundations and charitable organizations to develop these Principles, which we hope all organizations will adopt and promote,” said Diana Aviv, executive director of the Panel and president and CEO of Independent Sector, which convened the Panel. “This document can serve as a both catalyst and a guide for boards of directors across the country to engage in meaningful conversations about their existing operations.”

The Guide is a practical tool for charitable organizations to examine their operations and evaluate where they can improve. Some organizations may find that all principles do not apply to their operations. The Guide is designed to help the nonprofit community to continue to reach for the high standards of governance and ethical practice that it -- as well as the communities it serves -- deserves.

“In addition to laying out the elements of good governance, the Guide will help strengthen the commitment to responsible conduct, for individual nonprofits and for the sector as a whole,” said Lorie Slutsky, president of The New York Community Trust.

The Panel on the Nonprofit Sector has been dedicated to finding ways to strengthen governance, transparency, and ethical standards within the nonprofit community since it was convened by Independent Sector in October 2004 at the encouragement of the leaders of the Senate Finance Committee, Charles Grassley (R-IA) and Max Baucus (D-MT). The Panel’s Final and Supplemental Reports, issued in 2005 and 2006 respectively, offered close to 90 recommendations for improving government oversight, including new rules to prevent unscrupulous individuals from abusing charitable organizations for personal gain. The Pension Protection Act of 2006 enacted many of these recommendations into law.

“The Guide continues the work of the Panel to ensure that charities and foundations maintain the trust of the public by meeting the highest standards of ethical practice,” said M. Cass Wheeler, CEO of the American Heart Association and co-convener of the Panel.

The Principles for Good Governance and Ethical Practice are organized into four categories:

• Legal Compliance and Public Disclosure -- responsibilities and practices, such as implementing conflict of interest and whistleblower policies, that will assist charitable organizations in complying with their legal obligations and providing information to the public.
• Effective Governance -- policies and procedures a board of directors should implement to fulfill its oversight and governance responsibilities effectively.
• Strong Financial Oversight -- policies and procedures an organization should follow to ensure wise stewardship of charitable resources.
• Responsible Fundraising -- policies and procedures organizations that solicit funds from the public should follow to build donor support and confidence

The principles are available on the Panel website. Those who are interested in receiving a hard copy of the Guide should visit the Panel website to order. Up to 25 copies of the report may be ordered free of charge. Also available are the Panel’s 2005 Final Report and 2006 Supplemental Report.

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The Panel on the Nonprofit Sector is an independent panel of 24 leaders from a wide range of the country’s public charities and private foundations. Convened by Independent Sector in October 2004 at the encouragement of the leadership of the U.S. Senate Finance Committee, the Panel has brought together thousands of people from across the country to develop recommendations to improve the governance, ethical conduct, and oversight of nonprofit organizations. The Panel released a major report in June 2005 and a supplemental report in April 2006. To learn more about the Panel on the Nonprofit Sector, please visit: www.nonprofitpanel.org.

Independent Sector is a nonprofit, nonpartisan coalition of approximately 600 charities, foundations, and corporate philanthropy programs, collectively representing tens of thousands of charitable groups in every state across the nation. Its mission is to advance the common good by leading, strengthening, and mobilizing the nonprofit community.