Bushfires pose challenges for NFPs

Tuesday, 07 April 2020

Phil Butler GAICD photo
Phil Butler GAICD
NFP Sector Leader, Australian Institute of Company Directors

    The catastrophic bushfires that Australia has witnessed this season started months earlier than usual, the ferocity of which has been described as unprecedented by experts. Horrific scenes were broadcast worldwide and conditions continue to be challenging across the country.

    The recovery process, as always, will include lessons learned on how we deal with such emergencies. It will also see many directors of NFP organisations responsible for the oversight of programs aimed at supporting the most vulnerable in our community.

    Already we are seeing negative media commentary and social media activity questioning the efforts of some NFP organisations tasked with providing services and distributing funds to those impacted. Questions about how donations are being distributed and at what speed are likely to gain further attention over the coming weeks.

    Lessons from previous disasters

    Directors of NFP organisations may wish to consider some of the lessons learned from previous disasters.

    In the wake of Hurricane Katrina and the 9/11 attacks in the USA, a report produced by the Urban Institute and Hauser Center for Nonprofit Organizations, looked at NFP responses to the tragedy. It reflected upon a range of issues confronting recovery efforts.

    According to the report, “the public expectations, including those of most editors and reporters, are unrealistic because there is little concrete understanding of charities’ basic nature and what they do.” While this was referring to an overseas disaster more than a decade ago, it’s unlikely that the Australian community has a higher level of understanding and the public’s desire for immediate results is only strengthening.

    Another issue explored in the Hauser Report was the comparative advantage that organisations of all sectors brought to such disasters. Different sectors have both skills and limitations and understanding what these are, and their implications, is critically important. It has long been recognised that the NFP sector is very good at collaboration, and crises such as the bushfires will put that collaboration to the test.

    What can organisations do?

    While some of the criticism about recovery efforts may seem unwarranted, community expectations necessitate that boards are well prepared to deal with the influx of donations and requests for services.

    It is apparent that some organisations are quickly establishing committees (often separate from the board) to oversee the collection and disbursement of monies.

    The AICD’s Good Governance Principles and Guidance for Not-for-Profit Organisations provides a helpful framework and tips for organisations may wish to assess the oversight of the recovery efforts they are responsible for.

    Principle 6 – Performance

    A critical role of the board is providing overseeing appropriate oversight of the organisation’s resources.

    Organisations will be tasked with striking the right balance between process and systems that negate the misuse of funds, while also enabling flexibility so funds can be delivered to those needed in a timely and efficient manner.

    Principle 8 - Stakeholder engagement

    Given the sensitivity involved with recovery efforts, the board is well advised to oversee a framework that delivers meaningful engagement of all stakeholders. Understanding and managing expectation is critical to this process.

    Board committees are a good way of assisting in this oversight role and can quickly provide advice to the board of what is and isn’t working effectively.

    The Urban Institute and Hauser Center report also looked at the challenge that many NFPs had in getting resources to areas affected by the disaster and similar issues no doubt will occur with Australia’s bushfires. The infrastructure of many communities has been destroyed and this of course means it is even more expensive to get services on the ground where they are required. There is also a likelihood that the traditional pool of volunteers has been displaced which reduces local knowledge. This puts an enormous logistical and financial strain on some organisations.

    The NFP sector will continue to provide a critical role in the aftermath of our disasters. No doubt mistakes will be made, and lessons learned for future challenges. However, we must acknowledge the importance of all parts of the sector including volunteers, directors, executives and staff who are providing vital services at a critical time.

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