Governance issues in not-for-profit organisations

Wednesday, 01 January 2020

Not-for-profit (NFP) organisations have distinct and important differences to their for profit or commercial counterparts. Their governance attributes need to be respectful of these differences if optimal performance within an effectively managed acceptable risk profile is to be achieved.

The basic precepts of good governance are fundamental to all organisations – having clarity of roles and responsibilities, a focus on strategic objectives and prudential risk management, appropriate financial management and disciplined accountability and transparency to members and stakeholders.

As part of the AICD’s commitment to the NFP sector and its directors, it has developed the Not-for-Profit Governance Principles. 1 This publication is designed to assist boards in determining what constitutes good governance practice for their organisations and to better deliver the mission outcomes of those organisations through good governance. 

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