The What and Wherefore of Nonprofit Bylaws

One thing I've learned from working in nonprofits is how easy it can be to put a low premium on institutional memory. At least, we tend to think about it less in the moment than five years later when trying to figure out why we (or they) took a particular action. The governance function is especially susceptible to this considering how often the players (i.e. board members) tend to turn over every three to - however many years. As much as I advocate for term limits, I admit that a downside to frequent turnover is that as people shuffle off a board (or committee), the ability to decode some of the “whats” and “wherefores” of how things are done usually goes with them. 

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The common board duty to periodically review and update bylaws tends to illustrate this difficulty. On more than one occasion I have looked at a nonprofit's bylaws only to find myself wondering: why on earth are they written like this? Clearly, something prompted a board to insert detailed provisions about fiscal management or extensive procedures on conflicts of interest or even specify the names of standing committees. While best practices suggest that provisions like those are more functional in board policies or resolutions, at one time nonprofit leaders felt compelled to stuff them into the bylaws.

Why, you may ask? Because the bylaws are just as much a reflection of the times in which they are written (or revised) as they are a series of finite rules and structures. Whether we care to admit it or not, bylaws are often informed by the current issues and power dynamics of their day. When it comes to reviewing bylaws, there will always be a plethora of historical questions to wade through - some of which may be easy to answer and others that may reveal organizational anxieties and political landmines.

Examining the historical underpinnings of uniquely-written governing documents can lead a board toward one of two extremes: either to completely disregard the past and do a complete overhaul OR to be overly reverential to the way things were and use it as a rationale for avoiding change. Clearly, this is indicative of a "Goldilocks Problem." What then is the middle path to ensuring that bylaws are both functional and reflective of the organization's unique identity?

To start, it's important to work with legal counsel to ensure that any legal and technical factors are incorporated into a draft or revision of the bylaws. These will likely include: 
  • Corporate Statutes: These are the laws nonprofits are subject to when they are incorporated in a particular state or jurisdiction. In addition to ensuring that the bylaws are compliant with standards that are explicit in those laws, it also helps to have awareness of those statutes that defer to an organization's bylaws to set its own standards and requirements.
  • Parliamentary Authority: Nonprofits that name a parliamentary authority (e.g. Roberts Rules of Order Newly Revised (RONR)) should ensure there is alignment between the contents of the bylaws and parliamentary rules and guidelines. It does not mean the bylaws won't include additional provisions and articles but structuring them in accordance with the parliamentary authority will set the organization up to better comply with the rules.
  • Other Laws & Regulations: There can be any number of legal or regulatory factors that might influence the rules that an organization adopts for itself. These might be informed by any number of unique circumstances such as grants, public contracts or regulations on specific services the organization provides. 
Once the legal considerations are taken into account, what remains can be any number of rules, processes and structures that reflect the organization's history, culture and even customs. This is where how things could be done might come into conflict with "how we've always done it". In some cases, recommending changes to existing processes can trigger political, cultural or operational hot buttons. Having strong institutional memory, in the form of records or witnesses to prior decisions, is a useful when trying to identify and mitigate potential roadblocks as well as communicate the rationale for recommended change.

When such institutional memory is not readily available, (and even if it is) it can be helpful to open up the bylaws review process for member or stakeholder review and comment. Some organizations may already require a lengthy notice and comment period as a requisite for amending the bylaws. Those that don't may benefit implementing one, either formally or informally, to ensure that recommended changes do not have unintended consequences.

Above all, it is important for any governance process, bylaws being only one of them, to be developed with a degree of intentionality that bridges the experiences of the past with the needs of the present and future. There need not be much controversy or uncertainty in the process so long as there is a balanced approach involving multiple voices and perspectives.

What role has institutional memory played in the development of your organization’s governance? How do your governing documents reflect the past, present and future of your nonprofit?

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Rachel Miller-Bleich, MA, CAE is a nonprofit governance consultant and owner of MillerBleich Consulting, LLC. To learn more, visit www.millerbleichconsulting.com.

© 2020 Rachel Miller-Bleich. All rights reserved. 

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