Con NEXTions 2013 Introduction of Governance Standards Governance

Con. NEXTions 2013 Introduction of Governance Standards

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

Governance Standards � Apply � 2 from 1 July 2013 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 � Good practice not best practice � Detailed � standards booklet at www. acnc. gov. au