To set the configuration folder, you need to set the variable com.aia_itp.itpols.config to the full path to the configuration folder that was created in section Creating the Configuration Folder.
To do this, start the WebSphere web admin and go to Servers > Application Servers and click on the server name. Then click on in the Java and Process Management section:

Then choose Java Virtual Machine > Custom Properties (under additional properties):

Click and create a property with the variable com.aia_itp.itpols.config. As the value, enter the full path to the configuration folder:

Which results in:

Hereafter, you may have to save your master configuration and you will have to restart the server for the changes to take effect.