Introduction of Governance Standards ConNEXTions 2013 Introduction of Governance Standards

Governance Standards Refer ACNC Act Regulations passed in June 2013 Apply from 1 July 2013 5 Standards A ‘base-line’ not best practice

Governance Standards Apply from 1 July 2013 2 Exceptions If Constitution / Rules prevents compliance you have until 1 July 2017 to make changes to address, If an incorporated association will be taken to meet the governance standards until 1 July 2017 if Appropriate incorporated assoc. legislation (state) sets out duties for responsible persons, and Your charity & responsible persons) comply with this

Governance Standard 1 Purposes and not-for-profit nature of a registered entity Must be not-for-profit Work towards charitable purpose Able to demonstrate it Provide information about their purpose to the public

Governance Standard 1 What? Demonstrate your charity is established as a NFP entity with a charitable purpose Actually run as a NFP entity & work towards your charitable purpose Provide information about your charitable purpose to the public

Governance Standard 1 How? Clauses in your governing documents setting out your charitable purpose & not-for-profit nature Run your organisation as a charity Provide governing documents to ACNC for uploading to the ACNC Register, make available on your website

Governance Standard 2 Accountability to members If you have members, be accountable to them Provide adequate opportunity to raise concerns abut governance of the organisation

Governance Standard 2 What? Take reasonable steps to be accountable to your members, Allow members adequate opportunities to raise concerns about how your charity is run.

Governance Standard 2 Only applies if you have members, How? Meetings at least annually with opportunities to ask questions & vote on resolutions, Give information to members, Have clear processes for appointing responsible persons (board members, committee members).

Governance Standard 3 Compliance with Australian Laws Must not commit a serious offence (i.e. fraud) under Australian Law No breach of laws where penalty 60 penalty units or more ($10,200)

Governance Standard 3 What? Must not act in a way that under commonwealth or state / territory law could be dealt with as, An indictable offence (serious crime), Breach of a law with a civil penalty of 60 penalty units Applies to the Charity not generally to individuals but may apply to governing body members acting on behalf of the charity

Governance Standard 3 Not a new obligation, you should be doing this now!, Some obligations for charities regulated by state & territory legislation, Be aware of major regulatory issues relating to your charity, Some basic financial controls, Process to ensure you meet legal obligations

Governance Standard 4 Suitability of responsible persons Must check that responsible persons are; not disqualified from managing a corporation (Corporations Act), or Disqualified from being a responsible person of a registered charity by the ACNC Commissioner Charities must take reasonable steps to remove responsible persons that do not meet these requirements

Governance Standard 4 What? Take reasonable steps to be satisfied that each responsible person if not disqualified from: Managing a corporation under Corporations Act Being a responsible person by the ACNC Commissioner within the previous 12 months If not satisfied, do not appoint, if already appointed, take steps to remove

Governance Standard 4 How? Search ASIC Disqualified persons register, Search ACNC register of disqualified persons (none as yet!) Require all responsible persons to sign declaration relating to disqualifying offences (ACNC has a suggested format Take these steps for existing responsible persons May be other state requirements i.e. Working with Children checks

Governance Standard 5 Duties of Responsible persons Charities must take reasonable steps to ensure responsible persons: Understand, and Carry out The duties set out in this standard

Governance Standard 5 What? Act with reasonable care and diligence, Act honestly in the best interests of the charity, Not misuse their position as a responsible person Not to misuse information gained in the role as a responsible person, Disclose conflicts of interest, Ensure the financial affairs of the charity are managed responsibly Not to allow the charity to operate while insolvent

Governance Standard 5 How? Bring these to attention of responsible persons Outline in latters of appointment Provide information to responsible persons on duties to refresh their knowledge, Encourage responsible persons to attend, prepare for & participate at meetings Have processes in place to manage conflicts of interest, Take reasonable action if a responsible person is not carrying out their duties

Governance Standards Common-sense Minimum standards Good practice not best practice Detailed booklet at www.acnc.gov.au