A Comprehensive Overview: the strengths and weaknesses of the current model and the range of options in Australia and internationally Keynote Speaker Associate Professor Jo Barraket Australian Centre of Philanthropy & Non profit Studies Queensland University of Technology

Community Sector Governance: Strengths, Weaknesses, & Alternatives Jo Barraket, The Australian Centre for Philanthropy and Nonprofit Studies

What we know about nonprofit governance Board effectiveness → organisational effectiveness No single ‘best model’ of governance Operating environment significantly influences governance choices and evolution Emphasis has been on organisational governance rather than NFP contributions to governance more widely

Different perspectives on governance Functional – focus on instrumental functions of board, management and other stakeholders Interpretive – focus on board as ‘sense makers’ of organisation Political – focus on relations of power within boards and between boards and other stakeholders

Australian Nonprofit Board Composition – the available evidence Predominately volunteers Predominately non-executive Predominately women (dependent on form of incorporation) Predominately years old Over-representation of professionals Larger on average than for-profit boards

Importance and Competence in Board Functions Source: Nicholson et al 2008

Current Approaches to Governance Common characteristicsDifferences Board has fiduciary responsibilitiesNature of constituent engagement/representation Funder compliance – upward accountabilities Relationship between board and CEO/staff Board typically elected by membership or constituents Roles of board/CEO in relation to strategic and operational development Distribution of decision-making power Presumed function of boards

Strengths & Opportunities of Current Approaches Connectedness to citizenry (sometimes!) Diversity and adaptation to context Access to embedded network resources Relatively strong knowledge of management and legal responsibilities (mostly self- reported) Giving voice to collective human aspirations

Weaknesses & Challenges of Current Approaches Relatively high board turnover Impacts of market models of governing Growth in compliance culture Lack of incentives for participation (?) Demographic and technological changes Limited engagement with parts of the citizenry

Alternative Models of Governance ModelFeaturesStrengths/Weaknesses Policy governanceEmphasis on board responsibility for strategy Clear role definition/lack of connectedness of board to operations, lack of innovation Constituent boardEmphasis on board members as representatives of constituency Constituent control/lack of strategic focus & role clarity Entrepreneurial boardEmphasis on output efficiency through innovation/market orientation Focus on organisational business/mission drift & emphasis on short-term gain Emergent cellular modelEmphasis on distributed networks and continuous evolution Highly adaptive/requires high engagement & coordination Source: Bradshaw et al, no date

Conclusions ‘Strengths’ & ‘weaknesses’ are relative and contingent on what we think community sector organisations are for Operating context and organisational purpose matter No ideal model, but core functions Governance considerations need to include questions about: – Composition – Function – Role and purpose

Resources for Board Self-Assessment ACPNS Developing Your Board Wiki

References Bradshaw, P., Hayday, B., Armstrong, R., Levesque, J., Rykert, L. (no date) Nonprofit Governance Models: Problems and Prospects accessed 17/11/10 Hough, A., McGregor Lowndes, M. & Ryan, C. (2006) ‘The Training Grounds of Democracy? Social Trends and Nonprofit Governance’ Working Paper No. CPNS31, Centre of Philanthropy and Nonprofit Studies, Queensland University of Technology, Brisbane. Nicholson, G., Newton, C. & McGregor Lowndes, M. (2008) Governance training needs in Community Organisations, Just Policy 49, December 2008: Steane, P. And Christie, M. (2001) ‘Nonprofit Boards in Australia: a distinctive governance approach’, Corporate Governance 9 (1): Woodward, S. And Marshall, P. (2004) A better framework: reforming not-for-profit regulations Centre for Corporate Law and Securities Regulation, University of Melbourne, Melbourne

Morning Tea will be served in the lounge area directly behind the auditorium The next conference session will begin at 11:00am Morning Tea