In 2012, the Commonwealth Government established the Australian Charities and Not-for-Profits Commission (ACNC), with a remit to remove complex regulations and repetitive reporting burdens, to clarify the legal definition of charity, and to provide greater transparency for funders and the public.
To achieve this, the ACNC was to support organisations with tools and standards that set minimum standards and encouraged better business practices.
Working with the Australian Institute of Company Directors, the ACNC created ten guiding principles of good governance for NFP organisations above and beyond those legislative duties of Management Committees and its members under the Associations Incorporation Acts (Qld).
- There should be clarity regarding individual director responsibilities, organisational expectations of directors and the role of board.
- A board needs to have the right group of people, having particular regard to each individual’s background, skills and experience, and how the addition of an individual adds to the collective capability and effective functioning of the board.
- The board sets the vision; mission and strategies of the organisation, helping the organisation understand these, and adapting the direction or plans as appropriate.
- By putting in place an appropriate system of risk oversight and internal controls, boards can help increase the likelihood that their organisation will deliver on its mission.
- The degree to which an organisation is delivering on its mission can be difficult to assess, but, this can be aided by the board determining appropriate performance categories and indicators for the organisation.
- A board’s effectiveness may be greatly enhanced through: careful forward planning of board-related activities; board meetings being run in an efficient manner; regular assessments of board performance; having a board succession plan; and the effective use of sub-committees, where appropriate.
- It is important that the board have in place a system whereby: there is a flow of information to the board that aids decision-making; there is transparency and accountability to external stakeholders; and the integrity of financial statements and other key information is safeguarded.
- The board has a role to play in enhancing the capabilities of the organisation they serve.
- The board sets the tone for ethical and responsible decision-making throughout an NFP.
- The board helps an NFP to engage effectively with its stakeholders.
How many of these principles are effectively embedded in your governance structure?
Other governance and leadership resources on Community Door
The Organisational Development Toolkit: particularly section two (governance and leadership)
Professional development resources developed through the sector readiness initiative
Organisational development modules (Module two: collaboration and planning; and Module four: leadership)
A recording of the organisational health check-up webinar held in August 2015, and associated resources
About Corporate Synergies Australia (CSA) and Linda Hayes
With over 20 years experience in business development, strategy and marketing, Linda has worked across a vast range of industry sectors to assist organisations deliver business growth and sustainability through tactical solutions and strategies.
Linda has worked with over one hundred not-for-profit organisations throughout Australia, and was an orginal contributor to the Workforce Council’s Sector Development tools for Costing, Pricing and Budgeting, and Financial Viability and Sustainability available through QCOSS’s, Community Door website.
CSA is currently a panelled service supplier to the Commonwealth Department of Social Services (Aged Care), the NSW Office of Communities (Aboriginal Affairs) for administration management, a preferred trainer and mentor to Bendigo Bank Community Branch Boards, preferred trainer and business adviser for National Disability Services (Qld) members.
Linda is a Certified Practitioner in Governance and Risk Management, Graduate of the Australian Institute of Company Directors, and holds a Bachelor in International Business as well as certifications in training and project management.
Connect with Linda Hayes via LinkedIn