Glossary
Compliance & Tax

Whistleblower Policy

By: Alec Hollingsworth
Updated:  
June 2, 2025

DEFINITION:

A Whistleblower Policy safeguards those who report suspected wrongdoing within a nonprofit organization from retaliation.
A Whistleblower Policy is a set of procedures and guidelines established by a nonprofit organization to encourage staff, volunteers, or other stakeholders to report suspected illegal, unethical, or fraudulent activities without fear of retaliation. This policy typically outlines how concerns can be reported, who will investigate the claims, and the protections in place for the whistleblower. Nonprofits are encouraged to have such a policy in place to foster transparency, accountability, and trust within the organization. A well-structured Whistleblower Policy helps to ensure that issues are addressed internally before escalating to external authorities or damaging the organization's reputation.

Key Takeaways

  • Encourages reporting of unethical or illegal activity
  • Protects whistleblowers from retaliation
  • Required for good governance and Form 990 compliance

Why It Matters

It protects individuals who report wrongdoing and helps nonprofits maintain integrity and comply with regulations.

Real World Example

A national nonprofit implemented a Whistleblower Policy after a staff member raised concerns about financial irregularities. The policy outlined a confidential process for reporting suspicions and provided assurance that the whistleblower would not face negative consequences for coming forward. As a result, the issue was investigated internally, corrective actions were taken, and the organization avoided potential legal and reputational harm. The clear communication of the policy to all staff and volunteers increased trust in leadership and fostered a culture of accountability.

How Aplos Helps

Aplos provides tools for tracking compliance documents, including policies like Whistleblower Policies, to help nonprofits uphold best practices for governance and transparency. Storing and managing compliance policies in Aplos ensures board members and staff have access to critical governance documents when needed.
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Frequently Asked Questions

What is a Whistleblower Policy?

A Whistleblower Policy is a set of procedures that allows nonprofit staff, volunteers, or stakeholders to report suspected misconduct without fear of retaliation.

Why should nonprofits have a Whistleblower Policy?

It fosters a culture of transparency, protects those who report wrongdoing, and is often recommended or required for regulatory compliance.

Is a Whistleblower Policy required for IRS Form 990?

While not legally required, the IRS asks if a nonprofit has such a policy on Form 990, and having one demonstrates a commitment to good governance.