The Nonprofit Revitalization Act of 2013 mandates best practices and governance controls to be implemented in New York State-based nonprofits; the law takes effect next month.

Of particular note is the good faith effort of nonprofit leadership to declare potential conflicts of interest. This concept is by no means new to the nonprofit sector. However, as many nonprofits are grass-roots they are naturally built on locally-based relationships, bonds, networks and connections.

These networks are an asset but can hinder growth if nonprofits do not follow the now required New York State policy of disclosure and recording of potential conflicts of interest. Such policies hedge against the “appearance” of conflict even if none is actually present. Often times, the appearance can be just as damaging to donor confidence than actual foul play.

The good news is that the new policy does not seem to add undue burden on the nonprofit sector and in fact increases the sector’s credibility.