What Are Policies? Definition, Examples and Why They Matter

Policies are the written rules that tell people what an organization expects of them. They sit behind almost everything a business does, from how employees handle customer data to how they report a safety incident. Yet many organizations still struggle with the basics: policies that are too long to read, too vague to act on, stored in the wrong place, or sent out with no way of knowing who has read them.

This guide explains what policies are, how they differ from procedures, what a good policy should include and the most common types. It also covers how to create, publish, review and track policies so they actually shape how people work. It is written for compliance officers, HR managers and IT administrators who own or enforce policies.

What is a policy?

A workplace policy is a documented rule or guiding principle that helps an organization make consistent decisions and sets out what it expects from employees. In simple terms, a policy tells people what is required, what is allowed or not allowed, and why.

A policy can apply to the whole organization, such as a code of conduct, or to a specific department, role, location or system, such as an acceptable use policy for IT equipment. Policies are usually approved by senior management, and they reflect the organization’s values, its goals and the laws and regulations it must meet.

A policy does not explain every step of how to carry out a task. That detail belongs in procedures, which sit underneath the policy and put it into practice.

Policy vs procedure: what is the difference?

Policies and procedures work together, but they answer different questions.

	Policy	Procedure
Answers	What is required, and why does it matter?	How should this be done?
Level of detail	High level and principle based	Detailed, step by step
How often it changes	Less often, usually after a change in law, regulation, risk or strategy	More often, whenever a system, tool or task changes
Example	Employees must report data security incidents immediately.	The steps to report an incident: who to contact, which form to use and what information to include.

Keeping the two separate means policies stay short and stable, while procedures can be updated as often as the work changes. For a fuller comparison that also covers processes, see our guide to how policies, processes and procedures differ. For the procedure side in detail, read our complete guide to standard operating procedures.

Why are policies important?

Well-written policies give employees a consistent framework for making decisions and understanding what is acceptable, required or prohibited at work. Specifically, they:

• Set clear expectations for employees
• Encourage consistent decisions across teams and locations
• Clarify who is responsible for what
• Provide the foundation for related procedures and training
• Help the organization meet its legal and regulatory obligations
• Reduce confusion when the same situation comes up again and again
• Provide a documented reference for audits, investigations and disputes
• Connect everyday behavior to the organization’s values

In some US industries, written policies are a formal requirement rather than good practice. For example, the HIPAA Privacy Rule requires covered healthcare entities to implement written privacy policies and procedures. Check which regulations apply to your organization and what they expect you to document.

What should a good policy include?

Most effective policies follow the same basic structure. Using it consistently makes policies easier to read, easier to find information in and easier to maintain.

Section	What it covers
Purpose	Why the policy exists and what it is meant to achieve
Scope	Which employees, departments, locations, systems and activities it applies to
Policy statement	The core requirements, written in plain language
Roles and responsibilities	Who owns the policy, who must follow it and who enforces it
Related procedures and documents	Links to the procedures, forms and guidance that support it
Exceptions and escalation	How exceptions are approved and how breaches are reported
Review and version information	Owner, approval date, effective date, version number and next review date

If you want a ready-made layout to start from, download our free Microsoft Word policy template.

Common types of workplace policies

The policies an organization needs depend on its size, industry, location and risks. These are some of the most common:

Policy type	What it typically covers	Usually owned by
Code of conduct and ethics	Expected behavior, conflicts of interest, gifts and hospitality	HR, legal or compliance
Anti-harassment and equal employment opportunity	Prohibited behavior, fair treatment, how to raise a complaint	HR
Information security and acceptable use	Passwords, device use, access to systems and data	IT or information security
Data privacy and records management	How personal and business data is collected, stored, shared and retained	Legal, compliance or a privacy lead
Health and safety	Workplace hazards, safe working practices, incident reporting	Health and safety or operations
Remote and flexible work	Eligibility, working hours, equipment and security at home	HR and IT
Leave, attendance and time off	Types of leave, how to request it, absence reporting	HR
Social media and communications	What employees may say publicly about the organization	Communications or HR
Procurement and third parties	Buying goods and services, vetting suppliers	Finance or procurement
Business continuity and emergencies	What happens during an outage, disaster or emergency	Operations or IT

For a longer list, see these essential policies every organization should have. If information security is your starting point, our beginner’s guide to information security policies walks through what to include.

Policy examples in plain language

A policy statement should be short enough to remember and clear enough to act on. Here is how three common requirements might read:

• Acceptable use: Company devices and accounts are provided for business use. Employees must not install unapproved software or share their login details with anyone.
• Anti-harassment: Harassment of any kind is not tolerated. Anyone who experiences or witnesses harassment should report it to their manager or HR, and reports will be handled confidentially and without retaliation.
• Incident reporting: All health and safety incidents and near misses must be reported by the end of the working day on which they happen.

Each statement says what is required. The detail of how to do it, such as which form to use or who to call, goes in the supporting procedure.

How to create an effective policy

1. Start with the purpose and the risk. Be clear about the business need, risk or compliance requirement the policy addresses.
2. Identify the audience. Decide who needs to follow the policy and write in language they will understand.
3. Assign an owner. Name one person or role responsible for drafting, approval, review and updates.
4. Write for action and understanding. Use short sections and clear requirements. Leave step-by-step detail to procedures.
5. Review and approve. Check accuracy and compliance with the relevant stakeholders, then approve it through your governance process.
6. Publish a controlled version. Store the approved policy in one central location, such as SharePoint, so everyone opens the same version.
7. Distribute it to the right people. Target the policy by role, department or location rather than sending everything to everyone.
8. Track acknowledgement where required. Record who has received and acknowledged the policy, rather than relying on email alone.
9. Review and update. Reassess the policy on a set schedule and whenever a law, regulation, system or role changes.

For more ideas on keeping this manageable, read our practical tips for policy management.

How policy management fits into the policy lifecycle

Writing a policy is only the first stage. A complete policy lifecycle covers creation, review, approval, publication, distribution, acknowledgement where needed, monitoring, scheduled review, revision and retirement.

Gaps usually appear between the stages: an updated policy is approved but the old version stays live, or a new policy is published but never reaches the people it applies to. Version control and a clear approval route help close those gaps. Our article on managing policy changes and versions in SharePoint covers this in detail, and larger organizations with many policy owners may find these governance frameworks for policy management at scale useful.

Standardizing policies across the organization

When every department writes policies in its own format, employees waste time looking for the information they need and policy owners find it harder to keep documents current. A standard structure, consistent naming, a single storage location and a shared review calendar make policies easier to read and easier to govern. They also make it simpler to show an auditor which version of a policy was in force on a given date.

How to make sure employees read required policies

Publishing a policy is not the same as communicating it. If a regulator, auditor or court asks whether an employee knew about a rule, a link in an old email is weak evidence. An effective process should:

• Assign each policy to the employees or groups it applies to
• Notify people when a policy is published or updated
• Set a deadline for completion where appropriate
• Record each person’s acknowledgement
• Follow up on acknowledgements that are overdue
• Keep records that show who read what, and when

This is the job Collaboris built DocRead to do. DocRead for Microsoft 365 works with your existing SharePoint Online libraries to target policies by role, department, location or group membership, ask employees to read and acknowledge them, send automated reminders and escalations, and report on completion by policy or by user. You can learn more about our policy management software for SharePoint, how it supports regulatory compliance tracking, and how it helps when onboarding new hires who need to read key policies in their first weeks.

Policy review checklist

Use this checklist each time a policy comes up for review:

• The purpose is still valid
• The scope still reflects who and what the policy covers
• The requirements are still practical and achievable
• Roles and responsibilities are current
• The procedures and systems it refers to still exist
• Employees can only open the approved, current version
• Material changes have been communicated to the people affected
• Acknowledgements are tracked where required
• Owner, approval and next review dates are up to date
• Superseded versions are retained or retired according to your records process

Frequently asked questions about policies

What is a policy in simple terms?

A policy is a documented rule or guiding principle that tells people what an organization expects of them and why.

What is the main purpose of a policy?

A policy sets expectations and boundaries that support the organization’s goals, governance, risk management and compliance. It helps people make consistent decisions without having to ask every time.

What is the difference between a policy and a procedure?

A policy explains what is required and why. A procedure explains how to carry out a task or meet the policy’s requirements, usually step by step.

What are examples of workplace policies?

Common examples include a code of conduct, an anti-harassment and equal employment opportunity policy, an information security and acceptable use policy, a data privacy policy, a health and safety policy, a remote work policy and a leave and attendance policy.

Who should own a company policy?

Every policy should have one clearly named owner who is responsible for keeping it accurate and coordinating reviews. The owner usually sits in the function closest to the subject, such as HR for leave policies or IT for acceptable use.

How often should policies be reviewed?

Review intervals depend on your governance requirements, the level of risk and any regulations that apply. Many organizations set a fixed review cycle and also review a policy sooner whenever there is a material change in law, regulation, operations or structure.

How can an organization prove employees received a policy?

By assigning the policy to the right people, notifying them, and recording each acknowledgement with a date and time. Tools such as DocRead track assignments, notifications, acknowledgements and completion status so you can produce this evidence when it is needed.