Nonprofit Quick Tip: Code of Ethics

CPAs & Advisors

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An organization’s code of ethics establishes the integrity and ethical values that provide a framework for decision-making. It guides behavior to be in support of the mission, for staff, board members, volunteers and others who work with the organization. The code of ethics is also an important step in creating a control environment where internal controls throughout the organization are effectively carried out.

Key elements to include in a code of ethics are: responsibilities of the board; expectation of personal and professional integrity; commitment to prudent financial management; requirement for compliance with applicable laws and regulations; and declaration of inclusiveness and diversity. As your organization establishes a code of ethics, it’s also important to consider how deviations will be identified and remedied in a timely and consistent manner.

Once established, the code of ethics will promote appropriate and consistent decision-making and behavior that is in alignment with your organization’s mission. Set your organization up for success by establishing the right tone at the top.

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