Who Is Allowed to Approve This? Clarifying Decision Authority Across a Nonprofit

Many nonprofit delays begin with a basic question:

Who has authority to approve this?

The issue may involve:

• A purchase
• A new vendor
• A staff hire
• A grant expense
• A contract
• A policy exception
• A public statement
• A program change
• A technology request
• An employee expense
• A partnership agreement
• Access to confidential information

The organization may have an approval process, but employees often cannot find it.

One manager believes the executive director must approve the request. Another sends it to finance. A department director assumes they have authority because they approved a similar request last year.

The result is delay, duplicated work and inconsistent decisions.

Maisy can help nonprofit employees find approved decision responsibilities, escalation paths and authorization limits without making the decision itself.

Approval Confusion Is Usually a Documentation Problem

Employees do not normally bypass approval procedures because they want to ignore organizational controls.

They often bypass them because the procedure is unclear.

The nonprofit may have:

• A financial policy that lists purchasing limits
• A job description that assigns general responsibility
• A board policy describing executive authority
• A grant agreement imposing additional restrictions
• A department procedure created several years ago
• An informal practice known only by experienced employees

Each source may provide part of the answer.

An employee trying to purchase new equipment may need to know:

1. Whether the purchase is included in the approved budget
2. Whether the expense is allowed under the grant
3. Which manager must approve it
4. Whether competitive quotes are required
5. Whether finance must review it
6. Whether a contract must be signed
7. Who has authority to sign that contract

When these answers are scattered, employees either ask several people or send the request to the highest-ranking person they know.

That turns senior leadership into a bottleneck.

A Realistic Nonprofit Example

Consider a nonprofit with 60 employees operating several programs across three locations.

A program manager wants to purchase $4,500 in equipment.

The manager believes the program director can approve it. The program director sends it to finance. Finance asks whether the expense is grant-funded. The grants manager says the purchase is allowable but may require funder approval because it was not listed in the original budget.

Operations then asks whether three vendor quotes are required.

Finally, the executive director is copied because no one is certain who has final authority.

The request sits unresolved for ten days.

Nothing about the purchase is unusually complicated. The nonprofit simply has not provided one clear explanation of the approval path.

This same problem appears repeatedly:

• Hiring requests are submitted without budget confirmation.
• Contracts reach leadership before legal or operational review.
• Expense reports are approved by the wrong manager.
• Staff members request system access without the data owner’s approval.
• Program exceptions are handled differently by each location.
• Board members become involved in routine operating decisions.

The organization has people with authority. Employees just cannot see how that authority is structured.

Why Approval Responsibilities Become Unclear

Titles are used instead of defined authority

A job title does not always explain what someone can approve.

A program director may control program operations but have no authority to sign contracts. A finance director may review a purchase without being the final approver. An executive director may delegate some responsibilities while retaining others.

The organization must document the authority attached to the role.

Policies describe rules but not workflow

A policy may state that large purchases require approval.

It may not explain:

• Who starts the request
• Who confirms the budget
• Who reviews grant restrictions
• Who approves the purchase
• Who signs the agreement
• Where the records are stored

Employees need the complete path, not just the rule.

Delegation happens informally

An executive director may tell a manager they can approve certain expenses while the executive director is away.

If that delegation is not documented, finance and other employees may not know whether it is valid or how long it lasts.

Authority changes as the organization grows

A small nonprofit may initially require the executive director to approve nearly everything.

As the organization grows, that structure becomes inefficient.

Authority may be delegated to department leaders, but the documentation does not always catch up.

Grants and contracts create exceptions

The normal purchasing policy may allow a department director to approve an expense.

A specific grant may require additional review or prior funder approval.

Employees must be able to see both the general rule and the applicable exception.

Board and staff roles become blurred

The board has ultimate governance responsibility, while staff leadership generally manages daily operations.

BoardSource explains that a nonprofit board retains ultimate responsibility while still being able to delegate appropriate operational authority.

When the boundary is unclear, board members may become involved in routine approvals, or staff may make decisions that properly belong to the board.

Decision Authority Should Be Written Down

Approval authority should not depend on memory.

The nonprofit should maintain an approved authority structure that explains:

• What type of decision is involved
• Who initiates it
• Who reviews it
• Who approves it
• Which limits apply
• Who signs any resulting agreement
• What documentation is required
• When escalation is necessary
• Who acts when the regular approver is unavailable

This may be called:

• An authority matrix
• A delegation-of-authority policy
• An approval matrix
• A responsibility matrix
• A decision-rights framework

The name matters less than the clarity.

Separate Review, Approval and Signature Authority

These responsibilities are often treated as the same thing, but they are different.

Review

A reviewer checks whether the request is complete, appropriate or compliant.

Finance may confirm that money is available. HR may confirm that a hiring request follows policy. Technology may review security requirements.

Review does not necessarily equal approval.

Approval

The approver authorizes the organization to proceed.

Approval may depend on the type and value of the request.

Signature

Signature authority allows someone to formally bind the organization through a contract, agreement or other legal commitment.

A manager may be authorized to approve a purchase without being authorized to sign the vendor contract.

This distinction should be clear in the nonprofit’s written guidance.

Approval Controls Protect the Organization

Clear authorization is part of a sound internal-control structure.

The National Council of Nonprofits explains that internal controls are generally documented through written policies describing the procedures an organization follows and who is responsible. It also recommends separating key financial responsibilities when possible.

For example, one employee should not ideally:

• Request a payment
• Approve the payment
• Record the payment
• Reconcile the bank account

Separating those responsibilities reduces the risk of mistakes, misuse and undetected fraud.

Smaller nonprofits may not have enough employees to divide every responsibility perfectly. In those cases, compensating controls may include:

• Additional management review
• Board treasurer review
• Regular transaction reports
• Dual authorization
• Independent bank reconciliation
• Documented exception review

Maisy can explain the approved control. It cannot replace the control itself.

How Maisy Helps Employees Navigate Approvals

Maisy gives employees a conversational way to find approved organizational guidance.

An employee might ask:

“Who approves a $4,500 equipment purchase?”

Maisy could retrieve the approved authority matrix and explain:

1. The program manager initiates the request.
2. Finance confirms budget availability.
3. The grants manager reviews any funding restrictions.
4. The program director approves purchases up to the documented limit.
5. Purchases above that limit require executive approval.
6. Contracts must be signed by an authorized signatory.
7. Grant-funded equipment may require additional funder approval.

The employee receives a practical path rather than a vague instruction to “ask finance.”

Another employee might ask:

“Can my supervisor approve a policy exception?”

Maisy may explain that supervisors can approve routine scheduling changes but that policy exceptions require HR and executive review.

The answer must come from approved organizational sources.

Maisy should not infer authority based only on someone’s title or previous behavior.

What Maisy Should Not Do

Maisy should not:

• Approve purchases
• Sign agreements
• Determine whether an expense is legally allowable
• Waive a policy
• Grant someone additional authority
• Interpret unclear bylaws
• Decide whether a conflict of interest exists
• Authorize access to restricted records
• Replace board, executive, legal or financial judgment

Maisy can explain the approved process.

For example:

“This request exceeds the program director’s documented approval limit and must be submitted to the executive director after finance review.”

That is different from independently deciding that the request should be approved.

Build an Approval Matrix Employees Can Use

A useful authority matrix should be specific enough to answer real questions.

Possible columns include:

This matrix is only an example.

Each nonprofit must define authority based on its bylaws, policies, staffing, contracts, grants and applicable legal requirements.

Use Roles Rather Than Only Names

Approval documentation should generally refer to roles:

• Executive director
• Finance director
• Program director
• Board treasurer
• HR manager
• System owner

This prevents the procedure from becoming obsolete every time an employee leaves.

The organization may still maintain a current directory showing who holds each role.

Maisy could answer:

“The finance director must review this request. The current finance director is listed in the staff directory.”

The authority belongs to the role, not permanently to one individual.

Temporary and Emergency Delegation

The nonprofit should document what happens when the regular approver is unavailable.

Questions to address include:

• Who serves as the alternate approver?
• Which responsibilities may be delegated?
• Which responsibilities cannot be delegated?
• How is temporary authority documented?
• When does it expire?
• Who must be notified?
• Are spending limits reduced during temporary delegation?
• Which decisions must wait?

Emergency delegation should not become a permanent undocumented workaround.

Maisy may help staff retrieve the approved temporary arrangement, provided that information has been documented and appropriately secured.

Board Authority and Operational Authority

The board is responsible for governance and ultimate oversight.

BoardSource describes the board as the governing body with ultimate decision-making and oversight responsibility, while recognizing that appropriate authority may be delegated for operational management.

The nonprofit should clearly define decisions reserved for the board, which may include:

• Approval of the annual budget
• Selection and evaluation of the executive director
• Major strategic decisions
• Changes to bylaws
• Major borrowing
• Mergers or dissolution
• Certain real-estate transactions
• Policies reserved by the bylaws
• Executive compensation

Daily operating decisions are usually delegated to the executive director and staff.

Maisy can help board and staff members find the approved boundary.

It should not interpret an unresolved conflict between the bylaws, board policy and current practice.

Permissions and Security

Approval guidance may contain information that is appropriate for broad employee access.

Other material may be restricted.

For example:

• General purchasing limits may be available to all staff.
• Executive signature authority may be available to managers.
• Banking authorization procedures may be limited to finance.
• Personnel approval guidance may be restricted to HR and leadership.
• Board-reserved matters may be available only to board members and executives.

SharePoint should serve as the primary organized knowledge source.

Microsoft states that Copilot Studio can use SharePoint sites and lists as knowledge sources and authenticate users using their SharePoint credentials. The agent should only surface content the user is permitted to access.

Permissions must still be reviewed before launch.

A knowledge hub should not expose restricted financial or governance procedures simply because they were stored in the wrong library.

Approval Status Is Not the Same as Transaction Status

Maisy can explain how approvals work.

It should not automatically claim that a specific transaction has been approved unless that information comes from an approved, current system connection.

The accounting, purchasing, HR or contract-management system remains authoritative for actual transaction status.

For example:

• SharePoint may contain the purchasing procedure.
• The accounting system may show whether funds are available.
• The procurement system may show whether the request was approved.
• The contract repository may contain the signed agreement.

Maisy can guide the employee to the right system.

Selected status information may sometimes be supported through a read-only connector, approved report, API or scheduled export.

That requires separate discovery, licensing, permissions, security review and testing.

Do not assume every approval system can be connected automatically.

AI Cannot Fix Undefined Authority

A nonprofit may discover that no one knows who should approve a particular decision.

The bylaws may be silent. The policy may be outdated. Two leaders may believe they hold the same authority.

Maisy cannot safely choose between them.

Leadership or the board must resolve the question.

The approved decision should then be documented with:

• Decision type
• Responsible role
• Approval limit
• Effective date
• Source of authority
• Review date
• Applicable exceptions

AI can retrieve a decision. It cannot create legitimate organizational authority.

A Practical Starting Process

1. Collect repeated approval questions

Ask managers, finance, HR, operations and program staff which requests are commonly delayed.

2. Review governing sources

Examine:

• Bylaws
• Board policies
• Financial policies
• Job descriptions
• Grant requirements
• Contract procedures
• HR policies
• Existing approval matrices

3. Map the current process

Document what actually happens, not merely what the policy says.

4. Identify conflicts and gaps

Look for:

• Overlapping authority
• Missing limits
• Former employee names
• Undocumented delegation
• Board involvement in routine operations
• Approval without review
• Signature authority confusion

5. Approve the authority matrix

The appropriate leadership or board body must formally establish the structure.

6. Organize the guidance in SharePoint

Use clear ownership, effective dates, review schedules and permissions.

7. Configure Maisy

Connect the approved sources and define how Maisy should respond when:

• Authority is unclear
• A request exceeds a limit
• Multiple approvals are required
• A question requires professional review
• A source is unavailable

8. Test realistic questions

Test purchase amounts, exceptions, absences, grant-funded requests and board-reserved matters.

Expected Organizational Benefits

Clear decision authority can help a nonprofit:

• Reduce approval delays
• Prevent requests from being sent to the wrong person
• Protect internal controls
• Reduce executive bottlenecks
• Clarify board and staff roles
• Improve grant compliance
• Make delegation more consistent
• Support employee onboarding
• Reduce undocumented exceptions
• Improve accountability
• Strengthen audit readiness
• Make operational decisions easier to trace

The goal is not to add unnecessary approval layers.

It is to ensure that the right person reviews and approves the right decision at the right time.

Make Authority Easier to Find

Maisy helps nonprofit employees find approved responsibilities, authorization limits and escalation procedures without independently making sensitive decisions.

Pixeldust works with nonprofits to identify unclear approval paths, organize authority documentation in SharePoint, review permissions and configure Maisy around the questions employees actually ask.

The process begins with discovery: understanding where decisions stall, who currently approves them, which authority is formally documented and which gaps the organization must resolve before Maisy can provide a trusted answer.