Accountability

The Issue
As entities that serve the public, nonprofits have an ethical obligation to conduct their activities in a way that is accountable and transparent to their constituents. Since a nonprofit's reputation is its greatest asset, ethics and accountability are of the utmost importance to the sector.

Draft Principles for Effective Practice
The Draft Principles for Effective Practice was created by the Advisory Council of the Panel on the Nonprofit Sector to strengthen the transparency, governance and accountability of charitable organizations. They are intended to instigate action by Congress, the Internal Revenue Service, and the charitable community.

Status: Currently under review and comment period. A final report will be issued in late Spring 2007.

Panel on the Nonprofit Sector
The Panel on the Nonprofit Sector was convened in October 2004 at the encouragement of the leaders of the Senate Finance Committee to consider and recommend actions to strengthen good governance and ethical conduct within public charities and private foundations. They issued a final report in June 2005 and a supplement to the final report in April 2006, which, together, contain nearly 150 recommendations. A few of these reforms were included in the Pension Protection Act of 2006.

The Pension Protection Act 2006
On August 17, President Bush signed into law the Pension Protection Act that includes a package of charitable giving incentives and safeguard measures as well as changes to exempt organization tax rules. The law does not include non-itemizer deduction , but does include IRA Charitable Rollover provision and increases contribution deductions for food, book, and certain conservation property. The IRA Charitable Roller expires December 31, 2007 unless this Congress is successful in making it permanent.

Maine: LD 1770
MANP members were well represented during the formation of this legislation, which made several changes to Maine's Nonprofit Corporation Act . Members of the working committee worked through the Fall of 2001 and the Winter & Spring of 2002 to create legislation that addressed the needs of many constituents to better regulate nonprofit conversions while not putting undue burden on Maine's nonprofit organizations.

MANP’s Position
Nonprofits serve the community and as a result should function with integrity and efficiency and should address violations within the sector.

• MANP supports an appropriate level of government regulation and enforcement to protect the public’s interest while upholding the integrity of the nonprofit sector.
  
  
• MANP promotes vigilance in maintaining excellence in the sector, speaks out against abuses of trust within the sector, and promotes the highest level of accountability within the sector.
  
  
• MANP encourages policies that strengthen the management capacity of nonprofits.