Big Brothers Big Sisters
Standards Of Practice For Independent Agencies

Board / Governance

Preamble

Standards 1 through 5 of the Standards of Practice (“Standards”) establish minimum governance standards for each Big Brothers Big Sisters (“BBBS”) agency’s board of directors (the “board”). Board members are fiduciaries who have a legal responsibility to represent the best interests of the organization and those it serves by ensuring that the agency’s mission is executed through ethical and legal governance and management policies, and ensuring the agency has adequate resources to advance its mission. An effective, decision-making board can strengthen an agency in many ways.

These Standards address some of the governance roles and responsibilities of these mission-critical leaders, as well as of agency leaders. These include, but are not limited to:

• Carrying out the agency’s mission, vision, and accountability statement;

• Governance, which includes adopting and enforcing agency bylaws; ensuring compliance with local, state, and federal laws as well as with performance expectations, the Standards, and the Membership Affiliation Agreement; overseeing the Chief Executive Officer/Executive Director; and ongoing board member recruitment and retention, engagement, and development;

• Strategic planning and fund development;

• Governance and financial policies; and

• Finance procedures.

In addition to complying with these Standards, agencies must ensure that they remain familiar with and are following state and local laws and requirements, developments in federal laws, and any provisions required by grants.

• Skip Ahead
• Standard 1 | Vision Mission and Accountability
• Standard 2 | Board of Directors Roles and Responsibilities
• Standard 3 | Strategic and Annual Planning
• Standard 4 | Board-Approved Governance and Finance Policies
• Standard 5 | Finance Procedures

Required Documents

The Standards provide more detail and guidance on the required policies and procedures. Sample documents are available on BBBS Connect. In summary, Standards 1-5 require the following plans, policies, and procedures:

• Bylaws (S.2.2)
• Board development (S.2.5)
• Board-approved strategy with accompanying written annual plan to achieve programmatic, financial, and fund development goals (S.3)
• Board-approved governance and finance policies (S.4):
  • Governance policies, including succession plan and code of conduct (S.4.1)
  • Executive limitations policies (S.4.2)
  • Finance policies (S.4.3)
  • Risk management policies (S.4.4)
• Finance committee-approved (and/or board-approved) finance procedures (S.5)

1. Each agency must have the same mission, vision, and accountability statement as that set by the Nationwide Leadership Council (“NLC”) and the Big Brothers Big Sisters of America (“BBBSA”) board.

• Mission: Create and support one-to-one mentoring relationships that ignite the power and promise of youth.

• Vision: All youth achieve their full potential.

• Accountability: By partnering with parents/guardians, volunteers, and others in the community we are accountable for each child in our program achieving:

  • Higher aspirations, greater confidence, and better relationships

  • Avoidance of risky behaviors

  • Educational success

1. Governance: Each agency must have a board that is charged with governance of the agency
2. Bylaws: Each board must develop, approve, and operate in accordance with written bylaws that comply with state nonprofit corporate laws. Bylaws should include, at a minimum:
   
   [Sample Bylaws Document]

1. Purpose, BBBSA-approved name, and agency service area

2. Governing authority of the board

   • Function, roles, and responsibilities
   • Definition of fiduciary duties
   • Authority to manage corporation and its finances
   • Process for oversight of the Chief Executive Officer (CEO) / Executive Director (ED) and provisions for delegated powers
     

3. Meetings

   • Number per year
   • Attendance expectations for members (including whether members may participate electronically or telephonically)
   • Provision to call an emergency board meeting
   • Parliamentary procedure (rules to govern meetings)
     

4. Board membership

   • Qualifications
   • Number (minimum-maximum range) of board members
   • Terms and term limits (if any)
   • Process for board member election
   • Procedure for resignation or removal of a board member or officer
   • Procedure for filling vacancies
     

5. Non-discrimination provision

6. Provisions for the existence of other advisory boards, if applicable (e.g., honorary trustees, satellite advisory boards), and what requirements/ authority these ancillary groups have

7. Voting

   • Define quorum
   • Whether ex-officio members are permitted, and any authority
   • Electronic voting provision (whether votes may be conducted electronically)
   • Hung board decisions
     

8. Officers

   • Officer titles, qualifications, and description of roles
   • Terms of office and number of consecutive terms permitted (term limits)
   • Process for selecting officers
     

9. Committees

   • Standing committees—description of authority and roles
   • Ad hoc committees—how they are determined and a provision for them to exist, if desired
   • How a committee may be created or dissolved
     

10. Indemnification

11. Process for amending bylaws

12. Books and records

    • Requirement that books, records, and minutes are kept, and where
      

13. Procedure for corporate dissolution and distribution of assets

14. Finances

    • Fiscal year
    • Contractual and loan authority
3. Compliance: Each board must certify, in writing through the self-assessment verification letter, to BBBSA on an annual basis that the agency is:

1. Incorporated and in good standing as a not-for-profit entity in the state in which the agency’s corporate office is located and (if applicable) qualified to do business as a foreign corporation in any other state(s) within its service community area;

2. Operating in compliance with applicable federal, state, and local laws, including those of the municipalities, counties, or states in which the agency’s operations exist, including operating in compliance with applicable federal, state, and local charitable registration requirements and fundraising ordinances;

3. Retaining its not-for-profit tax-exempt status with the Internal Revenue Service (IRS) as a 501(c)(3) entity;

4. Developing, reviewing, and updating (as necessary) all written plans, policies, and procedures that require board approval, including, but not limited to, those required in these Standards; and

5. Operating in compliance with the terms of the Membership Affiliation Agreement with BBBSA and the Standards.

4. Chief Executive Officer/Executive Director oversight: The board is responsible for CEO/ED oversight and executive leadership succession, as specified in the agency’s bylaws. This includes, at a minimum:

1. Maintaining an up-to-date, written job description for the CEO/ED that clearly defines the CEO/ED’s authority, role, and responsibilities

   • Effective with the implementation of this Standard, the job description must include the requirement that the CEO/ED have, at least, a bachelor’s degree from an accredited college or university

     • The Board must ensure that the CEO/ED has, at least, a bachelor’s degree as set forth above. Under extenuating circumstances, the board may submit a candidate who does not have a bachelor’s degree to BBBSA for an exemption approval; in those rare situations, however, the CEO/ED candidate must have at least 10 years of relevant work experience.

   • The CEO/ED must be a full-time employee of the agency, based on the number of hours identified by the agency as constituting full-time status. Other than in the case of an interim CEO/ED, the CEO/ED cannot be an independent contractor.

     • Pursuant to Standard 2.4.3, an interim CEO/ED cannot serve for more than 90 days without BBBSA’s approval

2. Evaluating the CEO/ED’s compensation (per S.6.3.3) and the CEO/ED’s job performance through a regularly scheduled, annual, written performance review process against agreed-upon performance goals that include, at a minimum:

   • Compliance with the Membership Affiliation Agreement and the Standards

   • Metrics based on the agency’s written, board-approved strategy and annual plan required in Standard 3

3. Implementing the following in the event of a change of executive leadership:

   • Notifying BBBSA in writing within 10 business days of a vacancy in executive leadership, the naming of an interim CEO/ED, or the hiring of a new CEO/ED;

   • Ensuring the CEO/ED position is not vacant for more than 90 days without notification being provided to BBBSA;

   • Confirming that the new CEO/ED completes BBBSA’s online orientation curriculum for new CEOs/EDs within the first 90 days of employment.

5. Board development: Each agency must have a board-approved, multi-year, written board development plan that is implemented by the board and designated agency staff and that addresses, at a minimum:

1. Clarity of roles and responsibilities relative to the implementation of the board development plan;

2. Practices for the identification and recruitment of potential new board members that include using sources and strategies that yield qualified, diverse board candidates in the selection pool;

3. Orientation process for new board members;

4. Board training plan including BBBSA’s cultural humility and youth protection courses or equivalent as outlined in Standard 9.3

5. Succession plan for rotation or resignation of officers; and

6. Annual written evaluation of individual and collective board performance, with summary results presented to the board.

1. Each agency must have a written, board-approved strategy (which may take the form of a strategic plan, framework, or other similar structure) and a written annual plan to achieve programmatic, financial, and fund development goals. Strategies may be localized, but should not contradict with national BBBSA strategies and direction. The fund development component of the annual plan must identify board and agency staff roles and responsibilities and include measurable fundraising goals that are applied to multiple revenue sources to sustain a diversified funding base.

Each agency must have board-approved, written policies that are reviewed by the board at least every three years, or as policies are revised. The policies must include the following components, at minimum:

1. Governance policies

1. Written succession plan

   • Set forth a plan in the event of CEO/ED resignation, termination, or leave of absence

2. Code of ethics/Code of conduct [Sample Code of Ethics/Code of Conduct]

3. Code of ethics may encompass other policies noted below in S.4.3 to S.4.8.

4. Whistleblower and disposition of complaints

   • Purpose: Form 990 & Sarbanes-Oxley

   • May be two separate policies. Whistleblower policy must include nonretaliation provisions and/or a reference to the retaliation policy in the employee handbook

5. Conflict of interest

   • Purpose: Form 990 and state nonprofit statutes

6. Record integrity, retention, and destruction

   • Purpose: Form 990 & Sarbanes-Oxley

   • Must include record retention and destruction schedules in accordance with all applicable federal, state, and local laws

   • Must include document litigation hold procedure and employees’obligation to abide by such a request

7. Lobbying and political activity

   • Purpose: Form 990 & IRS Code 501(c)(3)

   • Policy must include prohibition of campaign activities (e.g., candidate support, electioneering)

8. Board members and agency staff serving as volunteer Bigs (See Standard 9.9)

9. Fund development

   • Must include guidelines concerning solicitations and use of funds
2. Executive limitations policies

1. Expenditure approval authority

   • Must include thresholds for multiple signatures and board approval

2. Lending and lines of credit

   • Must address who has the authority to commit the agency to loans or take out lines of credit on behalf of the agency
3. Finance policies

1. Role of the board and/or board finance or finance related committees

   • Must include the role of an appropriate board committee (e.g., finance or audit) or the board where such committee is not practical, and a high-level process regarding the committee’s (or board’s) review of agency financials, auditor selection and audit review, and Form 990 review. The policy must provide that the Form 990 be approved by the full board.

2. Audit

   • All BBBSA agencies (of which the minimum operating threshold is an annual budget of $200,000) are required to have an annual financial statement audit complete and submitted to BBBSA within nine months of the agency’s close of corporate fiscal year. The policy should address that a minimum of every five years some form of rotation (personnel or firm) should be considered.

3. Liquidity policy

   • Must include reserves policy, line of credit policy (if applicable), approach to cash flow management, etc.

4. Gift acceptance/donations policy

   • Must include:

     • Types of gifts the organization will and will not accept

     • Process for valuing and recognizing in-kind donations in accounting records

     • Requirement that contributions comply with donor intent

     • Acknowledgement of contributions per applicable tax code requirements

     • Decision-making process when acceptance of a gift is not otherwise covered in the policy

5. Investment policy

   • Must be in alignment with state Uniform Prudent Management of Institutional Funds Act (UPMIFA) laws. Should also address endowed funds, if applicable.

6. Capital expenditure policy

   • Must include threshold for capitalization

7. Procurement policy

   • Must include process for purchasing at various thresholds. If the organization receives federal funding, this should align with the Uniform Guidance procurement rules (Uniform Guidance 2 CFR 200)

8. Notification to BBBSA regarding financial standing

   • Policy addressing who within the organization is responsible for notifying BBBSA in the event of insolvency, intent to file bankruptcy, etc.

9. Credit card policy

   • Must outline which levels of staff have corporate cards, receipt policy, and review of CEO/ED expenses

10. Board expense reimbursement policy

    • Must indicate the types of expenses eligible for reimbursement and the process/required documentation
4. Risk management policies

1. Technology security policies and workplace practices on data privacy, confidentiality, and security

   • Confidentiality and privacy/security (including cyber security) of personnel, donor, financial, and program participant data

2. Insurance coverage

   • Insurance plan specifies all insurance coverage secured, including accident, agency auto, directors and officers, errors and omissions, sexual abuse and molestation, general liability, property, and worker’s compensation

   • There may be other insurance policies that are appropriate for the board to consider. At a minimum, agencies must have $1,000,000 of sexual abuse and molestation coverage, which may be included in the agency’s errors and omissions form. This may not be sufficient for some agencies, however, and boards are strongly encouraged to consult with insurance brokers on appropriate coverage levels. Boards are also strongly encouraged to consider umbrella insurance policies.

3. Crisis management policy

   • Must include practices to address likely situations based on BBBS operations. Must include crisis communication procedures.

4. Child protection policies and procedures

   • Must include local child protection policies and procedures that reflect the Standards, including immediate reporting of any critical child safety incident, as required in S.9.8. The document may be the agency’s program manual.

5. Continuity of operations plan

   • Must include resources, actions, and procedures for use in the event of a major disruption of services

Each agency should have a financial procedures manual that is reviewed by the board finance committee, or if no such committee exists, by an appropriate board committee or by the full board annually. At a minimum, the manual should encompass the topics below.

1. Practice for maintaining compliance with Generally Accepted Accounting Principles (GAAP)


2. Note: the organization may operate on a cash or modified accrual basis throughout the year, but year-end audited financial statements must be on an accrual basis in alignment with GAAP
3. Practices for separation of duties for internal controls


4. Must outline how separation/segregation of duties is addressed and indicate mitigating controls where segregation of duties is not available
5. Practice for budget development and approval


6. Must note the timing and roles of the budget process, and indicate that the budget should be approved before the start of the fiscal year
7. Practice for monthly review of financial statements

• Must include review of month-end financials by management monthly and by member(s) of governance at least quarterly

• Suggested month-end financials include a statement of activities with budget to actual, statement of financial position, and a cash management tool or report

8. Processes for key finance functions (optional)


9. May include processes for recording and managing revenues, expenses, cash management, fixed assets, and month-end close