Principles for Good Governance

In response to calls by some for government oversight of sector organizations, Senators Grassley (R-IA) and Baucus (D-MT) encouraged Independent Sector to convene an independent panel to develop and recommend actions every charitable organization should consider to strengthen good governance, ethical conduct, and effective practice. In response, Independent Sector convened the Panel on the Nonprofit Sector, comprised of 24 nonprofit and philanthropic leaders whose organizations encompassed diversity in location, mission, perspective, and scope of work.

The Panel issued their “Strengthening the Transparency, Governance, and Accountability of Charitable Organizations” report to Congress in June 2005.

A supplemental report was issued in 2006. The reports offered more than 100 recommendations to improve government oversight, including new rules to prevent unscrupulous abuse of charitable organizations for personal gain. Many of the recommendations were enacted in the Pension Protection Act of 2006.

Equally committed to developing effective, broadly applicable methods of self-regulation, in October 2007 the Panel issued the Principles for Good Governance and Ethical Practice, A Guide for Charities and Foundations — premised on the belief that the best bulwark against misconduct is always well-informed vigilance by nonprofit community members themselves, including a set of principles they could adopt or adapt, promote sector-wide, and improve over time.

The Principles were updated in 2015 to reflect new circumstances in which the charitable sector functions, and new relationships within and between the sectors.