In this topic, we explore policies and procedures. We look at what they are, why they’re important and how they relate to one another. We show you the steps to develop your own policies and procedures, and templates to get you started.

Defining policies and procedures

An organisation, community or nation needs clear policies and procedures to govern effectively and get things done. Many groups develop policies and procedures that suit their unique circumstances. These policies and procedures reflect cultural principles and values while also being practical.

Organisations, communities or nations develop policies and procedures for a wide range of reasons. These may include:

• achieving and maintaining accreditation or incorporation status
• complying with new funding requirements
• providing instructions on how to perform new or complex tasks.

Some groups also have processes. Processes are the series of actions or steps to achieve an outcome. Your policies may refer to processes or procedures. For example, your recruitment policy may outline a process on how to onboard new staff.

Policies feed into processes. Processes then feed into procedures.

Policies, Processes & Procedures Pyramid

For the purposes of this Toolkit, we focus on policies and procedures.

Policies and procedures can have a big impact on your governing culture. Give careful thought to them and how to put them in place.

“Good governance on an operational level also means we have comprehensive policies and procedures that are kept up to date. Nyamba Buru Yawuru Limited (NBY) employs around 100 people, including casual staff and so managing those staff includes ensuring everyone understands our operational procedures. While our policies and procedures are informed by regulatory and statutory regimes, we also try to make them relevant to our staff on a cultural level. Our annual performance review process is referred to as ‘junyba’ (sharing) which is intended to influence the process to be an open and constructive dialogue for both managers and staff that will encourage better performance and communication.”
– Nyamba Buru Yawuru Limited (NBY)¹Australian Indigenous Governance Institute, Our People, Our Way: Stories of Indigenous Governance Success (Australian Indigenous Governance Institute, 2020), 57.

Policies

Policies are more than a list of rules. They’re the big-picture guidelines that set out what an organisation wants to achieve. Processes and procedures are then designed to get those big-picture things done.

Policies include:

• long-term vision and goals
• performance standards
• outcomes expected.

Policies are set by the board or governing body. Final approval lies with the board. Decisions made by the board in relation to policies are binding (legally enforceable).

Good policies influence culture, communicate expectations and guide operations.²“Buyer’s guide to the top 6 policy management tools,” PowerDMS, published March 2022, [link]

Good policies also:

• define who can make decisions
• encourage efficient decision making
• clarify expectations
• increase understanding of how to do things
• ensure accountability
• put strategy into action
• help achieve effective governance.

Good policies

Procedures

Procedures explain the actions needed to implement policies and processes. Procedures focus on the details. They guide how to respond in specific situations using step-by-step instructions. Well-written procedures are clear, factual and to the point.

Procedures (and processes) are usually drafted by the CEO and management, and approved by the board.

Together, they:

• set the standard
• keep everyone accountable (those making the policies as well as those who follow them)
• act as frameworks for future direction and strategy implementation
• set boundaries, constraints and limits on action
• reward and sanction behaviour
• specify what staff can expect
• reduce the chance of inconsistent, unfair or erratic decision-making
• enable reliable delegation of powers to management and staff.

Types of policies and procedures

There are 2 broad types of policies and procedures – governance and operational.

Governance

Governance policies are about the bigger picture of governance (as opposed to day-to-day activities). They set out how the group will conduct its business and oversee the proper operation.

Your governance policies should cover these areas:

Planning

• Vision, purpose and goals
• Guidelines for making policies
• Guidelines for planning
• Governance values

Leadership

• Making decisions
• Representation, rules and responsibilities
• Codes of conduct
• Conflict of interest
• Relationships with members and community
• Succession planning and mentoring

Organisation

• Organisational standards
• Meetings and committees
• Board’s duties and its ethics (for example, a board charter)
• Separation of power between board and CEO
• Relationship between board and CEO
• Relationship with staff
• Board self-evaluation and how it develops governance
• Professional development and training
• Dispute resolution and appeals

Manage

• Corporate governance
• Risk management
• Managing finances
• Accountability
• Performance appraisal of CEO

These policy areas are adapted from the First Nations Governance Handbook by Neil Sterritt.³Neil Sterritt, First Nations governance handbook: a resource guide for effective councils (Ottawa: Indian and Northern Affairs Canada, 2001), 29.

The CEO or management may develop the processes and procedures that relate to governance policies. The board reviews and approves them.

Operational

The CEO and management may be involved in drafting operational policies but the board still has responsibility for them.

Operational policies apply to the administration and daily management of the group. They may include:

• complaints procedures
• diversity
• bullying and harassment
• employment, human resources and managing staff.

The CEO develops and oversees operational policies and procedures. The board reviews and approves them.

Develop your policies and procedures

Policies and procedures need to be workable, fair and easy to understand.

To gain support for your policies and procedures, it’s important that:

• community and staff understand them
• community and staff have been consulted and had the chance to contribute to them
• they reflect widely-held values.

Write down your policies and procedures, and make sure copies are always accessible. It may be useful to translate them into language and visual formats. For example, the Walpiri Education and Training Trust (WETT) use visual representations to tell their story.

Develop your policies

Each organisation, community and nation has their own way of developing policies, focusing on issues that matter most to them. But there are some common steps you can follow:

1. Understand the problem to be addressed

Describe the issue the policy needs to address. Make sure to keep it simple.

2. Identify the overall policy objective

Consider the principles that will underlie your policy. These principles should link to the vision and values of your organisation. Keep these principles in mind when developing your policy.

3. Collect information and consult widely

Consider who the policy or issue will affect, and see what they have to say. Don’t just consult the experts. Talk to your Elders, leaders and networks to see what they think and the solutions they may have tried.

4. Identify the risks

Risks may relate to unintended impacts on people. They may be cultural, economic or political. When developing your policy, consider whether it will resolve or increase tensions and conflicts.

5. Be realistic

Set yourself up for success by developing a policy that’s easy to implement and enforce.

6. Identify the cultural factors involved

Describe the cultural issues, values, customs and relationships that the policy may need to take into account. Consider what cultural factors might strengthen or undermine its success.

7. Identify the scope of policy options and choices

Keep the scope practical. The policy should also make sense, be fair and workable, and address immediate problems and issues.

8. Consider the internal and external environment

This includes your vision statement, the community and government rules. Consider, for example, your members’ and community’s expectations and needs.

You should also consider the legal and financial requirements. Think about how you will communicate the new policy to members, the wider community, agencies and stakeholders.

9. Draft the policy in writing

• Use clear and simple language.
• Align with your vision and strategy.
• Include a cultural values statement.
• Include ideas about how to enforce the policy in the wider community and cultural context.
• Identify skills, knowledge or professional capacities that may need to be developed to support the policy.
• Have a set format for your policies.

10. Present the policy to the board for formal approval

Follow the approval process as per your decision-making processes. The board is responsible for both developing and approving policies – they aren’t just a ‘rubber stamp’ for policies written by a manager.

11. Set up systems to apply and review the policy

Policy development is an ongoing process. It needs periodic review to adapt to the changing governance environment. Set a realistic timetable for reviewing the policy. This includes considering legislative or compliance changes that affect your organisation.

It’s management’s responsibility to make sure procedures are in place so that the policy is communicated, understood and followed. Make sure that management agrees to provide updates to the board and members (where appropriate) about how the policy implementation and procedures are going.

Have an up-to-date policies and procedures (governance) manual accessible to all staff. You should also include policies in your induction training for new staff, members of your governing body and management.

Remember, policy-making is a learnable skill.

Groups should provide board directors with training on how to make policies. This should cover how to work with their CEO to make sure the organisation follows the policies.

CEOs and managers should receive training about how to create practical processes and procedures that support the policies for staff to follow.

You may engage external consultants to help draft, implement and communicate a policy (in some cases, processes and procedures too). Consultants bring expertise, for example, in law, human resources or policy development.

Develop your procedures

Once you have a clear policy, you can develop your procedure.

Organisations often have procedures in place without realising it. This is because they’re not formalised or in writing.

Develop a procedure in writing when:

• the procedure is lengthy or complex
• it’s important that everyone follows the same procedure or set of rules to get something done
• there are negative impacts if done incorrectly
• people seem confused about how to do something.

Some tips to develop your procedures:

• Write the actions out in the order in which they happen.
• Use the active voice.
• Use lists and bullet points.
• Avoid using jargon or slang where possible.
• Write at an appropriate reading level.
• Make use of design elements (for example, flowcharts).
• Consider whether users have enough information to complete the action. Is the level of detail appropriate for the subject and the readers?

Create a governance manual

When a footy player breaks a rule, there are referees and coaches to pull them up. They might be disciplined before the tribunal. They can’t plead ignorance. All the policies for the game are written down in the game’s rule book and in club policies.

In the same way, it can be useful to have your group’s policies written down and pulled together in one place. We call this a ‘governance manual’.

Your governance manual should be simple. Write it in plain language so that people on the board – and in the organisation, community and nation– can understand it.

A simple list of contents for a governance manual is provided below. It will give you some ideas of the kinds of policy areas to include in your governance manual.

Review your policies and procedures

Organisations are subject to constant change and evolution in the wider environment. It’s important to assess and update policies and procedures regularly to stay current and adapt to change.

You may consider developing a policy or guide about how, and how often, policies should be reviewed. For example, how they’re drafted, reviewed, approved and implemented. Different policies may have different review periods.

Boards should:

• discuss the policy implications of decisions at their meetings
• periodically review their written policies and procedures.

For major reviews or changes, consult widely. Include members and anyone affected by the policy to give them a chance to provide feedback.