Of course it is. But there's no point trying to put policies into a directory in a tree which doesn't exist and by extension which Firefox won't be reading.
In Linux (and in any sane system) there is no need for elevated privileges just to alter your browser settings.
Firefox will read it if it exists[1]. You could use the /usr/lib/firefox/distribution directory (or whatever the installation directory may be), but that may be overwritten by an update.
There doesn't seem to be any way to set per-user group policies, so unless you're installing firefox in a user-controlled directory, it will require elevated privileges.