Annual NFP governance and performance study reveals directors spending more time on NFP role

Wednesday, 31 July 2019

The Australian Institute of Company Directors (AICD) has today released its annual not-for-profit (NFP) governance and performance study, which revealed that directors are spending more time on their governance role.

The AICD’s NFP Governance and Performance Study is in its 10th year and is the world’s largest study in NFP governance.

Over its 10 years the NFP study has helped raise awareness of the contribution of directors.

This year the study found that 55 per cent of directors surveyed spend one to five days a month on their NFP role and 23 per cent spend more than five days a month on a single NFP.

The latest report identifies the factors that contribute to NFP board workloads which include rising governance expectations, community trust challenges for NFPs, the introduction of the NDIS, growing financial pressures, and changes in organisation complexity and regulation.

In addition to investigating the time directors spend on NFP board, this year’s study explored directors’ remuneration, succession planning, the sports sector, the slowdown in mergers, and financial performance.

AICD CEO and Managing Director, Angus Armour, thanked the tens of thousands of NFP directors who have contributed to the study over the last ten years.

“The annual NFP governance and performance study supports our mission to strengthen society through world-class governance.

“Our long-term tracking shows us that there has been strong and continuous improvement in NFP governance, which is being increasingly scrutinised.

“As governance workloads rise in the NFP sector, it’s important to monitor whether the current model of NFP governance is sustainable and what can or should be done to innovate it.

“The AICD remains committed to the NFP sector and we are proud that we were again able to offer 140 scholarships to small NFPs to attend training programs this financial year.”

Key findings of the 2019 NFP Governance and Performance Study:

  • Directors are devoting more time to each NFP board role with 23 per cent of survey respondents spending more than 5 days per month on a single NFP (compared to 13 per cent in 2013).
  • NFP boards continue to comprise of mostly older directors with 77 per cent over 50 and only five per cent under 40 years old.
  • The percentage of directors being remunerated hasn’t fluctuated, with 19 per cent remunerated this year.
  • NFP directors are optimistic about their organisation’s future but financial challenges persist with some inconsistency between profit expectations and actual profit.
  • Fewer organisations are engaged in or are considering merging with another NFP.
  • Directors are generally satisfied with the performance of their board.
  • Key challenges for sports organisations are growth in revenue and membership, and facility improvements.
A graph of stats pertaining to nfp study showing increased time spent by directors on their not-for-profit roles

Media Contact: Maegen Sykes 0439 167 567

Latest news

This is of of your complimentary pieces of content

This is exclusive content.

You have reached your limit for guest contents. The content you are trying to access is exclusive for AICD members. Please become a member for unlimited access.