The Treasurer’s Challenge Social Outcomes and Financial Responsibility Glenn Poole Executive in Residence The Australian Centre for Philanthropy and Nonprofit Studies 7 th Australasian Better Boards Conference – Melbourne 5 July 2013

Advice to the first Governor of Queensland “Let your thoughts never be distracted from the paramount object of finance. All states thrive in proportion to the administration of revenue……” Sir Edward Lytton British Secretary to the Colonies

The Treasurer’s Challenge Social Outcomes and Financial Responsibility For reflection ……….. –Does a good treasurer need more than good accounting and financial management skills? …. And.. –What value can a treasurer add to the organisation in achieving its mission, apart from a focus on the numbers?

An outline Identifying changes that have occurred in the operating environment for NGOs, Discussing the impacts of these changes particularly on the treasurer’s role, Suggesting new areas and activities where the treasurer can add value, Looking at emerging challenges that will change and shape the expectations of treasurers.

Changes to the NFP world 1980s –Government funded basic services –NFP identified service gaps 1990s –“Gaps” became mainstream – government funding & reporting increases 2000s –Government outsourcing – $25.5bn in government funding to NFPs

Impact of change on NFPs & treasurers Interest from professional & community bodies Academic research Government agency advice Increase in NFP organisations relying on a high proportion of funding from government Increased accountability expectations Broader accountability expectations Measurement & reporting of outcomes Measurement & reporting of social impact

Impact of change on NFPs & treasurers For-profit vs Nonprofit governance –NFPs 'mission' driven, not 'profit' driven. No one way to measure achievement of mission. –NFPs have multiple, critically important stakeholders with conflicting primary interests –Many NFPs are small but face accountability standards drawn from large 'for profit' regimes –NFP boards / committees are generally voluntary –NFP boards / management committees are generally under-resourced.

Recent academic research on boards Nonprofit Management & Leadership journal [2012] –Intra-board dynamics –Social capital –Board members & networks –Internal leadership dynamics –Board performance –Self-assessment diagnostic tool on team effectiveness

Developing Your Board - self-evaluation Key diagnostic elements - MembershipRole clarityComposition FeedbackExpectationsSupport mechanisms Peer supportProcessesRelationships Personal Development

Other research –Increased social capital a positive contributor to board performance –Social capacity improves information sharing, reduces conflict, alienation & turnover –Passion & engagement of NFP board members –Treasurer’s relational skills critical in board team dynamics & performance

The emerging challenges for treasurers CSIRO – six mega-trends More from less Going, going gone? The silk highway Forever young Virtually here Great expectations

Conclusion Today’s treasurer is more than a financial guru Community & government expectations for reporting on outcomes & social impact Treasurers can adapt skills in measurement & reporting concepts Application of relational abilities important in managing accountability demands More relationally aware treasurers = better boards = better organisational performance = improved social impact