You can do everything right programmatically—great vision, good people, meaningful work—but if your NGO’s internal structure is shaky, it can all fall apart. Governance and internal controls are the scaffolding that hold everything together.
Let’s be honest: for many nonprofits, these are the less exciting parts of the work. But they’re the most essential.
What Does Good Governance Look Like?
It’s not about having the biggest board or the most impressive titles. It’s about having a group of people who are deeply committed to the mission, understand their legal responsibilities, and are willing to ask tough questions.
Good governance means:
- Your board members know what fiduciary duty means—and they live it.
- You have clear bylaws that actually reflect how your organization runs.
- Your board evaluates itself regularly, as much for accountability as for improvement.
Tools like the “Boards in Gear” guide from the Nonprofit Association of Washington help boards self-assess and stay on track.
Also, let’s not forget about mission alignment. Every major decision should point back to your mission. If the shiny new opportunity doesn’t align—let it go.
Internal Controls Aren’t Just for Big NGOs
If you think you’re too small to worry about internal controls, think again. Fraud, mismanagement, and burnout don’t care about your size. Internal controls protect your reputation, your staff, and your beneficiaries.
Here’s what they might look like:
- Segregation of duties: The person approving the expense shouldn’t be the one cutting the check.
- Dual authorization: For anything involving money, two sets of eyes are better than one.
- Monthly reviews: Look at your bank statements and match them to your records—yes, every month.
- Document everything: Policies, procedures, receipts, meeting minutes. It might seem tedious, but you’ll be grateful when an auditor comes calling.
Risk Isn’t the Enemy—Ignorance Is
Don’t wait for a crisis to learn about risk. Use the “Boards in Gear” risk matrix or resources from the Nonprofit Risk Management Center to evaluate your biggest vulnerabilities. What could go wrong? What will you do if it does?
Have a crisis communication plan. Have a data breach plan. Have a “what if the ED quits tomorrow” plan. These aren’t signs of paranoia—they’re signs of maturity.
Leadership Isn’t About Control
Good governance builds a culture of openness. That means:
- Encouraging board dissent
- Setting ethical standards that go beyond legal minimums
- Welcoming feedback from staff and beneficiaries
- Compensating leaders fairly and transparently
And yes, equity matters. Make sure your board isn’t just diverse on paper but empowered to make decisions.
Finally, strong governance and internal controls don’t make headlines—but they do make a difference. They build the foundation for real, sustained impact. As one seasoned executive director put it: “Our programs change lives—but our structure keeps us alive.”
References
- Nonprofit Association of Washington (2022). Boards in Gear Toolkit. https://nonprofitwa.org
- Nonprofit Risk Management Center (2023). Internal Control Self-Assessment.
- Communities Rise (2023). Sample Governance Policies and Procedures.
- IRS (2024). Governance and Related Topics for Tax-Exempt Organizations.
