Research is underway for the 2017 NFP Governance and Performance Study and new tools for NFP directors are in the pipeline, writes NFP Sector Leader Phil Butler.

    At the Australian Institute of Company Directors (AICD), we recognise the critical contribution that not-for-profit (NFP) organisations make to our society. Without a well-governed NFP sector, our community would not function properly.

    We also recognise the evolving nature of governance in the sector, the annual NFP Governance and Performance Study (the Governance Study) has been of vital importance in shining a spotlight on the changing challenges and opportunities facing the sector.

    2017 NFP Governance and Performance Study

    In 2016, the Governance Study explored a range of themes including the need for NFP’s to build financial strength and for many this means making or increasing their profit. We also found that while many directors recognised the need to spend more time on strategy, the reality in a fast-changing environment was that they were more focused on short-term issues.

    This year, the Governance Study will explore the role of culture in an NFP context and its relationship to organisational performance. It will also consider how NFP boards identify and manage risk, and the attitudes that NFP directors take towards risk in their roles.

    The Governance Study will also hone in on two sub-sectors, focusing on disability services and also into NFPs operating on the international stage, providing greater detail and insight into these areas.

    New NFP director tools

    Following on from the 2016 Governance Study, we understand that many directors were seeking practical tools to assist their boards in achieving good governance.

    In endeavouring to meet this need, we released a range of tools – in particular many with a more financial focus which our members told us would be of the greatest use.

    At the end of this month, we will be releasing a new tranche of refreshed NFP tools including:

    • Governance of NFP organisations;
    • Role of the chair;
    • Role of the board;
    • Role of the CEO and MD; and
    • Corporate governance.

    We will also be releasing several new NFP tools including:

    • Related party transactions;
    • Conflicts of interest;
    • Mergers and collaborations;
    • Role of the treasurer; and
    • Position description for a treasurer.

    These tools will be added to the range of resources that are already available on the NFP Resource Centre. More tools will be announced in the next edition of this newsletter.

    Blueprint for NFP Reform

    In March this year, we released Governance of the Nation: A Blueprint for Growth 2017. A specific component of the Blueprint addressed the need to change the relationship with the NFP sector to one of a partnership approach. Included in our recommendations was the need to provide an improved funding environment for NFPs and develop a fit-for-purpose regulatory regime. As a key component of this, we have been heavily involved in the #fixfundraising campaign.

    In early May, the Director Sentiment Index was released and this again showed the level of engagement of our NFP members. Approximately one third of the respondents to this bi-annual study were from the NFP sector and they echoed the need for governments to undertake real reform in the NFP regulatory space.

    NFP Forums in Melbourne and Perth this May

    Building on the successful NFP sessions held at the Australian Governance Summit in March, the AICD is holding NFP Forums in Melbourne on 23 May and Perth on 25 May.

    We are delighted to have Anne Skipper AM FAICD as keynote speaker at both of these forums. Anne is a highly experienced NFP director and a wonderful communicator, who amongst other roles is Chair of Silver Chain.

    Speakers at the Perth forum are directors and CEOs from a range of diverse NFP organisations, and include Penny Knight, director of Nulsen Disability Services and Therapy Focus.

    At the Melbourne NFP Forum we are especially pleased to welcome Dr Susan Alberti AC FAICD, who has been a trailblazer of women’s AFL and instrumental in the success of the Western Bulldogs.

    We trust you find the NFP newsletter of continued interest and welcome any comments or suggestions for future editions. We also invite NFP members to contribute articles of their own.

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