Helping The Not-for-profit Sector Grow With Good Governance

It takes a lot to run a business, and not-for-profit (NFP) organisations are no different. But much of what keeps things running isn't just the day-to-day operations, but the governance happening behind the scenes.

Governance in NFPs is increasingly important. Facing more competition and stakeholder scrutiny, their long-term sustainability depends on good governance.

Good governance helps NFP organisations improve performance, have a defined vision of their future, ensures there is accountability and oversight of operations, and manages risk.

TECT and Institute of Directors Bay of Plenty branch have recently partnered to offer a range of ways to grow and support good governance in the not-for-profit sector, with TECT funding ensuring the events and courses are subsidised or free.

One of the partnership's offerings is a series of free NFP Governance Forums for trustees to attend to develop their governance understanding and commitment to best-practice governance.

The forums feature an assortment of guest speakers, resources, case studies and articles, and aim to have the same group of people attending all sessions from separate NFP boards; providing further opportunity to grow relations, connections and networks for continued learning and future collaborations. The first forum was held in April, with the next one taking place on 27th July.

Another exclusive event taking place on 8th July will be the NFP Symposium, with six experienced directors as guest speakers, and two break out deep-dive sessions on specific governance topics.

Topics covered include 'The Four Pillars of governance best practice', 'The importance of relationships and partnerships in governance', 'It all starts with the Constitution', 'Diversity in action at the board table', 'How youth and inexperience add value to a board' and 'Finding the Why?'.

Thanks to TECT, Institute of Directors Bay of Plenty Branch and the Tauranga Club, the cost is only $30 to attend.

An NFP Governance Essentials Course is also currently open for scholarship applications. The one-day course will help attendees gain a confident grasp of robust board processes, good decision-making, and board operations in a not-for-profit context.

Applications are open to experienced directors new to the sector, new and aspiring directors, and senior executives who want to work with their boards more effectively. Content covered will include:

Governance, legal, and regulatory framework essentials

board charters, the role of the board, culture and ethics, and board composition

board protocols, meetings, and papers

board and management relationships and succession planning.

TECT has made five scholarships available for NFP board members to attend each of the events, with one being held Thursday 28th October, and one being held Tuesday 16th November. Those that are not selected for the scholarship will be offered a discounted rate for attendance, with 19 places for discounted attendance available for each course date.

Institute of Directors Bay of Plenty branch chair Jana Rangooni says the partnership offerings provide valuable insight into NFP governance.

"It doesn't matter if you are on an NZX-listed board, council, or your kid's sports club committee – you are still liable for the health and sustainability of that organisation. It's imperative that trustees, board members and directors understand best-practice governance and can apply the principles with confidence.

"The cost for quality governance training is often a barrier to NFPs, but its value goes beyond just governance, helping community organisations remain focused and operationally effective for the long term. Attendees will also gain a network of other NFP trustees and the confidence to speak up when they know principles of good governance are not being upheld.

"We are excited to meet all the attendees and hear how they'll apply what they've learnt about the frameworks and process of good governance to their own board roles."

The partnership with TECT was set up to meet the need for more governance support in the not-for-profit sector, Jana says.

"TECT approached us following an NFP panel event we did last year where Peter Farmer, a TECT trustee, was one of the panellists. Both he and the local IoD branch recognised an opportunity to work together to strengthen NFP governance for the benefit of both individual organisations and the wider community.

"TECT's funding has been so important in helping bring these not-for-profit offerings to life. It's allowed us to tailor sessions specifically for the NFP community, where budgets are tight. Good governance is vital to ensure a strong organisation of any form. We recognised this and TECT funding is helping us deliver," she says.

TECT Trustee Peter Farmer has served on a number of NFP boards, including the Compass Foundation, Acorn Foundation as a founding board member, Waipuna Hospice for nine years, including as Deputy Chair, and Riding for the Disabled for 15 years. He has also served on numerous 'for-profit' Boards.

He says he has observed there is little difference between an NFP Board and a for-profit one.

"The difference, if there is one, is often the lack of awareness within an NFP Board that their accountability is the same. Both types of boards are formed to govern the entity and act in the best interests of that entity's interest and/or its stakeholders.

"A key difference, however, is that NFP boards are frequently, by necessity, made up of voluntary unpaid members who are invariably passionate about the entity's objective and purpose but understandably, they may be lacking in full understanding of their legal obligations and how best they can add value to their board.

"In my experience, the key to any successful NFP board is the appointment of an experienced Chair who in turn will appoint board members who reflect a strong balance of complementary skills and experience to enable the board to achieve its objectives. A good Chair will continuously be developing their board."

Peter says that now through the NFP Governance Essentials Course, all NFP Chairs can ensure their board improves its ability to sustainably grow their entity and adhere to all relevant compliance standards.

"The Institute of Directors and TECT NFP Governance Essentials Course will add substantial value to all NFP boards, and I commend it to all within Governance in both the NFP arena and 'for-profit'.”

To learn more about all the TECT and Institute of Directors Bay of Plenty Branch NFP Governance offerings and to register online, visit www.tect.org.nz/institute-of-directors-and-tect.

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