Governance Articles

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Duty of board members:  Not to allow a charity to operate while insolvent

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The final in our series of six articles discussing Duty of Board Members. 

Board members must ensure that their charity can pay its debts when they are due. This is called being solvent. If a charity is unable to do this, it will be insolvent.

The complete article appeared in the February 2016 edition of Not-for-Profit Law Notes.  Read more ...

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 Duty of board members to disclose and manage conflicts of interest

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The fifth in a series of six articles covering the duties of Board Members of registered Charities.

The complete article appeared in the November 2015 edition of Not-for-Profit Law Notes.  Read more ...

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Duty of board members to manage financial affairs responsibly

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The fourth in a series of six articles covering the duties of Board Members of registered Charities.

The complete article appeared in the October 2015 edition of Not-for-Profit Law Notes.  Read more ... 

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Duty of board members not to improperly use information or their position

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The third in a series of six articles covering the duties of Board Members of registered Charities.

The complete article appeared in the September 2015 edition of Not-for-Profit Law Notes. Read more ...

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Duty of board members to act in the best interest of your charity and for a proper purpose

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The second in a series of six articles covering the duties of Board Members of registered charities.

The complete article appeared in the August 2015 edition of Not-for-Profit Law Notes.  Read more ...

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Duty of board members to act with reasonable care and diligence

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This is the first in a series of six articles regarding duties of board members or other responsible persons to their charities – in other words, their fiduciary duty. 

The complete article appeared in the July 2015 edition of Not-for-Profit Law Notes.  Read more ...

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Governance

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Much is said about governance these days, particularly in relation to not-for-profit organisations. Is it all just theory (hot air)? We don't believe this.  Read more ...

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New governance standards for charities

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New governance standards are now in effect for charities that are registered with the ACNC. These governance standards will need to be met on an ongoing basis in order to maintain registration with the ACNC.

The standards are expressed as minimum requirements for governance of a charity; they do not cover all aspects of governance. It is expected that charities will have governance practices that go beyond these minimum standards. Also, the ACNC will generally apply the standards as a set of general principles, rather than as precise words. In other words, a charity can generally choose how to comply with the standards, as long as it can demonstrate its approach is appropriate taking into account its situation.

The standards are:

Standard 1: Purposes and not-for-profit nature of a registered entity
Charities must be not-for-profit and work towards their charitable purpose. They must be able to demonstrate this and provide information about their purpose to the public.

Standard 2: Accountability to members
Charities that have members must take reasonable steps to be accountable to their members and provide their members adequate opportunity to raise concerns about how the charity is governed.

Standard 3: Compliance with Australian laws
Charities must not commit a serious offence (such as fraud) under any Australian law or breach a law that may result in a penalty of 60 penalty units (currently $10,200) or more.

Standard 4: Suitability of responsible persons
Charities must check that their responsible persons (such as board or committee members or trustees – called ‘responsible entities’ under the ACNC Act) are not disqualified from managing a corporation under the Corporations Act) or disqualified from being a responsible person of a registered charity by the ACNC Commissioner. Charities must take reasonable steps to remove any responsible person who does not meet these requirements.

Standard 5: Duties of responsible persons
Charities must take reasonable steps to make sure that responsible persons understand and carry out the duties set out in this standard.

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