Governance for Not for Profit Organisations
Governance is the underlying framework in accordance with which a group of people makes and takes action for a shared purpose. Good governance is primarily aimed at ensuring good outcomes in terms of the purposes for which the association was created.
Governance Standards 8000-2003 were developed to provide ‘a blueprint for the development and implementation of a generic system of governance suitable for a wide range of entities’ including not for profit organisations.
Governance addresses issues such as how the organisation communicates, is directed and makes decisions. It is important that organisations operate in a legal and ethical manner. Decisions need to be made in the interests of eligible stakeholders and the organisation must behave as a good corporate citizen.
Good governance ensures clarity of roles and responsibilities; accountability through appropriate systems; and
effective and open decision-making and management processes.
In the not-for-profit sector many organisations are now delivering social services that were previously delivered by government. As a result, governance issues are more important than ever.
Your organisation’s governance requirements are set out in a number of places including your organisation’s
Constitution, Rules and legislation.
In addition, good governance requires:
- participation of members, staff and other stakeholders;
- the Board to create/maintain a positive culture that promotes openness and honesty;
- the Board to develop a vision and strategic plan in consultation with relevant stakeholders;
- that all Board members are duly elected or constitutionally co-opted;
- that the Board makes valid decisions in the best interests of the organisation taking into account members and other stakeholders;
- policies and activities be consistent with and further the constitution;
- processes for dealing with complaints by members, staff, or clients which cannot be resolved by staff and management;
- a management structure which facilitates open communication between all parts of the organisation; and co-operation with other organisations in the sector.