Douglas OFlaherty, IOM
Chief Operating Officer, South Carolina Restaurant and Lodging Association
Published
September 24, 2025
Nonprofit bylaws are the foundational rules that govern an organization’s operations, from board structure to meeting protocols. However, many associations and chambers of commerce forget that these aren't set-it-and-forget-it documents.
Regularly reviewing your bylaws is crucial for legal compliance, operational efficiency, and good governance. Over time, an organization's needs, state and federal regulations, and best practices in governance can change. Failing to update bylaws can lead to several problems:
- Legal and Financial Risks: Outdated bylaws might not comply with current state or federal laws, potentially jeopardizing your nonprofit's tax-exempt status or opening the door to legal challenges. For example, laws regarding conflict-of-interest policies or board member term limits may have changed.
- Operational Inefficiency: Bylaws that don't reflect current operations can create confusion and hinder decision-making. If the bylaws specify a board size that's no longer practical or a meeting schedule that doesn't work for your members, it can slow down the organization.
- Poor Governance: Bylaws that aren't reviewed can fail to address modern governance challenges, such as the use of virtual meetings or electronic voting, which are common practices today. This can make it difficult to run the organization effectively and transparently.
About IOM
This article is brought to you by Institute for Organization Management, the U.S. Chamber of Commerce’s professional development program for nonprofit executives.
Tips for Reviewing and Updating Bylaws
Updating your bylaws doesn't have to be a daunting task. Here’s a simple process to follow:
- Form a Review Committee or Task Force: Create a small group with a mix of board members, staff, and a legal expert. This ensures a comprehensive review from various perspectives.
- Conduct a Thorough Review:
Go through the bylaws section by section. Ask questions like:
- Do these rules reflect our current operations?
- Are they clear and easy to follow?
- Do they align with our mission?
- Consult Legal Counsel: Always have a lawyer specializing in nonprofit law review your proposed changes. The lawyer can ensure that your bylaws comply with all current laws, protecting your organization from future risks.
- Follow Proper Procedure: Your current bylaws will outline the steps for making amendments. This typically involves a vote by the board of directors. Be sure to follow these rules precisely to make the changes legally valid.
Best Practices for Bylaws
When updating your bylaws, consider these best practices to create a document that is both legally sound and highly functional:
- Keep it Simple: Avoid making the bylaws overly complex. They should be easy to understand and follow. Place detailed procedures in a separate policy and procedures manual rather than in the bylaws.
- Be Forward-Thinking: Consider how your organization might grow or change in the future.
- Create a Regular Review Schedule: Don't just update them once and forget about them. Set a regular schedule—perhaps every 3-5 years—to ensure your organization's governance remains strong and effective.
By regularly reviewing and updating your bylaws, your nonprofit can build a stronger, more resilient foundation, ensuring it can continue to serve its mission effectively for years to come.
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