Governance, Mission and Not-for-profit Organisations: Old Thinking can be New Thinking Professor David Gilchrist School of Business, Fremantle University of Notre Dame Australia 12 May 2010

Our agenda 1.The regulatory environment and a push toward a national regulator 2.What’s new in this? 3.Where do voluntary board members and executives fit in?

What is the current state of play re Accounting Standards & NFPs? 1.Environment: Economic Audit Committee Henry Review Productivity Commission Review into the Contribution of NFPs A-IFRS AASB - Australia / New Zealand Convergence Associations Incorporation Bill ATO

The Henry Review B3 – Tax Concession for Not-for-profits: 41 – Establish a Charities Commission 42 – Apply Tax Concessions to Commercial Activities 43 – FBT Concessions to be phased out over 10 years 44 – Efficient tax regime for clubs should be developed (say one rate of tax over all income)

Some Definitions: Social Enterprise Mission driven organisations that apply market-based strategies to achieve social purpose May be profit generation for social investment or utilisation of market functions to achieve objective

Some Definitions: Social Enterprise High Risk Cultural Homogeneity Crucial Require A Social Entrepreneur

Some Definitions: Social Entrepreneur: Individual Pursue pattern breaking change A high level of autonomy required Often a risk taker

Some Reasoning: Individuality Cultural Dependency Risk Taking Mission Governance Sustainability

Another Model? Build on capacity Build on Commonalities Focus on Mission Outcomes Veer Toward Co-operation …Strength in knowing our organisation

Strength in Knowing Why: Financial viability Ongoing sustainability Work within the paradigm Leverage the strengths of professional staff and service providers

Strength in Knowing Financial viability: Understand the financial drivers of your organisation Drive for management accounting competence at all levels of the organisation Building budgeting strength

Strength in Knowing Ongoing sustainability Funder management – rates, outputs Stakeholder management - expectations Mission Centricity

Strength in Knowing Executives and Boards: Peak body engagement Governance framework inclusive of strategic planning and development Work within the skills and capacity of the organisation

Strength in Knowing Leverage the strengths of professional staff and service providers: Accountants Auditors Consultants Colleagues Peak Bodies

Concluding Remarks Don’t look for models but rather to use tools Spend time articulating the mission for clarity of goals Fully utilise the resources at hand Know your strengths and weaknesses Seek flexibility through capacity Work within the capacity of the organisation

Concluding Remarks …There are new horizons in coming to understand your organisation better and looking to use the tools rather than the models…