The Center for Social Responsibility and Accountability (CESRA) acknowledges that defining a universal set of “best practices for charities” applicable to all nonprofit organizations is challenging. However, there are widely accepted legal, ethical, and accountability standards that are anticipated of well-managed and responsible charitable nonprofits.
Embracing these recognized practices not only brings advantages to charitable nonprofits but also extends benefits to donors and, ultimately, the individuals and communities served by these organizations.
We encourage you to familiarize yourself with our recommended 15 standards of charity accountability. By adopting these standards, your organization can cultivate trust among donors, thereby attracting numerous benefits for its growth and sustainability.
CESRA’s 15 Standards of Charity Accountability
- Registration and Address (Standard 1):
- Ensure official registration with relevant bodies and provide a certificate upon request.
- Maintain a physical address for charitable activities during normal business hours.
- Constitution and Effectiveness (Standard 2):
- Develop and uphold a constitution outlining organizational operations and governance.
- Include provisions for the constitution’s enforcement and amendment if necessary.
- Mission and Vision Statement (Standard 3):
- Craft a concise mission statement communicating the organization’s purpose within its specific sector.
- Charity Activities (Standard 4):
- Document past year’s program service accomplishments and outline long-term and short-term organizational needs.
- Bank Accounts (Standard 5):
- Establish a nonprofit bank account for all donations and fundraising proceeds, separate from individual accounts.
- Governance (Standard 6):
- Govern the organization with a responsible board of at least five individuals, a majority of whom are independent.
- Ensure semiannual board meetings to establish policy and review accomplishments.
- Leadership and Operational Management (Standard 7):
- Appoint an executive staff committed to the organization’s mission and equipped for effective management.
- Oversee day-to-day operations, managing both paid and volunteer talent and financial resources.
- Accreditation (Standard 8):
- Seek accreditation to demonstrate commitment to industry standards and adhere to CESRA’s quality standards.
- Submit yearly accreditation renewal reviews and showcase accreditation status on CESRA’s website.
- Complaints (Standard 9):
- Implement policies for effective complaint procedures, ensuring prompt responses to and actions on complaints.
- Finance and Compensation (Standard 10):
- Limit compensated persons serving as voting board members to 10% or one person (whichever is greater).
- Allocate at least 65% of total expenses to program activities.
- Provide complete annual financial statements upon request.
- Nonprofit’s Obligation for Gifts from Donors (Standard 11):
- Adhere to terms and conditions of managing gifts as intended by donors.
- Regularly update donors on the progress and impact of their contributions.
- Board Meetings (Standard 12):
- Conduct a minimum of three evenly spaced full governing body meetings per year with a majority in attendance.
- Accept alternative modes of participation for those with physical disabilities.
- Annual Report (Standard 13):
- Submit annual returns three months after the financial year ends, using the provided annual report form.
- Conflicts of Interest (Standard 14):
- Establish a written conflict of interest policy identifying concerning conduct or transactions.
- Provide space for disclosure of any known interests by board members, employees, or volunteers.
- Privacy Policy (Standard 15):
- Maintain and communicate a privacy policy to reassure donors that their information is protected both online and offline.