Legislative changes and a desire to attract professional board members are driving significant governance change at WA’s smallest NFPs.
Legislative changes and a desire to attract professional board members are driving significant governance change at WA’s smallest NFPs.
Some of Western Australia’s smallest not-for-profit organisations are seeking to attract financial and human resources professionals in efforts to strengthen their governance and operating credentials.
Jane Chilcott, who is chief executive of Linkwest, the peak body for WA’s community-run NFPs, said many of the group’s 200 members had sought assistance in altering their constitutions and board compositions.
Many of Linkwest’s members have revenues of less than $500,000 per year.
Ms Chilcott said while the sector was preparing for state legislative changes to streamline regulations around governance of these organisations, many NFPs were also trying to attract people with financial and HR experience to join the largely volunteer-run organisations.
Currently, she said, many boards of smaller NFPs typically relied on community leaders or those involved in the group’s service delivery to take on the unpaid board or committee positions.
“The HR and IR environment in WA is so complex, each of these little organisations has to determine whether it’s a constitutional corporation, whether it’s trading, does it come under the federal award or state award, and a lot of the people who go on these committees have no HR background and they don’t have a HR or accounting department,” Ms Chilcott told Business News.
She said while Linkwest was creating a constitutional template to help NFPs streamline their framework, it was also helping new board members cope with the level of governance involved.
“To be completely honest, a lot of people when they first go on to those committees they are quite naive about the level of responsibility and accountability,” she said.
“We try and provide the knowledge, skills and understanding in a way that’s not going to frighten them off, because the requirements and the accountability of a small management committee that has an income of $100,000 or $200,000 is exactly the same as it would be for a large not for profit.”
During the past 18 months, Linkwest has been rolling out its board matching service, which Ms Chilcott said had been quite successful in placing people with organisations they could most benefit.
She said many new board or committee members had recently completed Australian Institute of Company Directors accreditation, come from Southcare’s Young Leaders On Boards program, or had spotted opportunities advertised by Volunteering WA.
She said while many people viewed the NFP sector as a springboard to gaining paid board positions, Linkwest had been surprised by the commitment shown by new board members.
“What we found is they’ve actually ended up staying longer than we’ve expected because they become very passionate about the organisation that they’ve become a part of and in the process,” Ms Chilcott said.
“They’re actually making quite a significant difference because they’re reducing the risk and they provide really invaluable service.”
