June 2015
  501 Consult 34KB
Non-Profit Notes
-insight for non-profit organizations

Articles and Bylaws 

When was the last time you reviewed your organization's bylaws or articles of incorporation? Do you know where they are? Is your organization guilty of letting dust gather on these crucial documents? Often, mention of either one is associated with a negative situation like noncompliance or inappropriate behavior.

 

Perhaps as a Board or staff member, you could view your articles and bylaws in a more positive light. Each one has an important purpose, can aid decision-making, and improve operations for your organization. Your articles and bylaws are invaluable tools!

 

Articles of incorporation are a nonprofit's organizing document. They create the organization under state law. Startup nonprofits must file their articles with the state where they seek incorporation. Any changes or revisions must also be filed. Articles serve the purpose of defining the basic parameters of the organization: name, purpose, number of Board members, and whether the organization has members. They can also offer Board members some protection against liability.

 

Bylaws on the other hand are an organization's operating manual. They are the rules by which a nonprofit is governed. Bylaws outline the duties and powers of the Board members and officers. They provide procedures for governance issues including the election, appointment, and removal of Board members and officers; filling vacant Board positions; creating committees; determining notice, time, and location of the annual meeting; changing the bylaws; and dissolving the organization. Bylaws outline Board member terms and term limits as well as establish the number required for quorum in official decision-making. If an organization has members, the bylaws also outline whether they have voting rights and provide for procedures in establishing member dues.

 

A quick review of your articles and bylaws eliminates procedural guesswork when electing new Board members. New Board members should be introduced to the basics by providing them a current copy of both the articles and the bylaws. "Mission-drift" can be minimized by referencing articles before deciding to launch a major new initiative. Overly assertive or non-participatory Board members can be kept in check with adherence to your bylaws.

 

But, what if your articles or bylaws are convoluted, confusing, or outdated? There are two choices:

  1. Change the structure of your organization to comply with your guiding documents.
  2. Change your guiding documents.

If you opt to make changes to your articles and bylaws remember these key points:

  • Decide if the issue could be addressed by Board operating policy
  • Adhere to procedures established in the current document to make changes
  • Adhere to procedures established in the current document to make changes
  • Adhere to procedures established in the current document to make changes
  • Adhere to procedures established in the current document to make changes

Articles and bylaws are essential to building and maintaining a strong foundation for your organization. The Board should review your articles and bylaws, as well as your guiding documents, every couple of years to determine whether changes are needed and as a helpful reminder of your organization's original purpose and operating procedures.

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"Out of difficulties grow miracles."

 

--Jean de La Bruyere, philosopher 

 

About Us

501 Consultants, Inc. specializes in nonprofits. Established in 1994, the firm has been shaped by decades of experience working with board members, committees, associations, organizations and government agencies, to achieve their unique and identified goals efficiently and effectively. We have worked with over 50 clients with some being clients for decades. Currently, 501 provides full association management services to clients as well as specific services utilizing a team of full-time and part-time staff, as needed, for client needs.

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501 Consultants, Inc.

509-782-1200

203 Mission Ave, Suite 107

PO Box 745

Cashmere, WA 98815

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