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Charity accountability standards revised

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In an effort to strengthen Minnesota’s nonprofit sector and create informed donors, the Charities Review Council is proposing new Accountability Standards for nonprofits.

The standards, which are used to conduct charity reviews, were last updated in 1998.

The primary change would increase the share of funds charities can spend on fundraising and administration to 40 percent from 30 percent, although groups spending more than 30 percent would be asked to provide an explanation to donors.

The change reflects the need for nonprofits to invest in their infrastructure, including strategic planning, technology and board development, to further their missions.

The revised standards also ask nonprofits to pay more attention to executive compensation, place greater importance on donor privacy and security, and require charities to hold at least four board meetings a year.

And the standards require nonprofit to increase their maximum unrestricted assets to three times their yearly expenses.

The council is seeking input on the recommendations through a series of town-hall meetings to be held throughout the state over the next few months.

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