Enterprise Care Blog

Viewing governance as a work in progress

2010-02-12T11:25:00.000+11:00

Enterprise Care continually emphasises to Boards and Directors that Governance is a work in progress. Any Director who is not in “ongoing governance training” is not a practicing professional Director.

The professional Director is rightly neither complacent nor totally satisfied with their governance performance. This approach means the Director is always striving to properly contribute to the governance needs of the organisation.

Whether the Director is asking the right questions or addressing the critical issues, must be foremost in their mind.

At least from the outside, it is possible to ask whether the right questions were raised or the critical issues addressed concerning the Haiti Earthquake appeal.

Why were there so many Australian charities all attempting to get their voice out there? Why were there so many messages – in some cases the same message coming from different charities? Was this a competition or a concerted effort to facilitate a benefit for those in need?

How many of the Directors asked and maybe “demanded” their organisation join with others and present a shared message and presence in Australia?

In a totally different example, The Wilderness Society has attracted much publicity lately but for all the wrong reasons.

Again, from afar, one can ask whether there has been complacency in their governance practices? How can an organisation’s Governance reach a point where the organisation itself creates internal friction and disagreements on a substantive scale?

Surely this is not simply a matter of bad luck!

As a Director, let’s not get caught up in specific examples, rather reflect on whether we view our governance role as a work in progress!

In Enterprise Care’s view, this is a critical priority for Directors as well as Boards in 2010. It is worthy to be placed on the Board agenda and discussed, albeit briefly, at each meeting throughout 2010.

Damien Smith
Managing Director

Managing your organisation’s SCORE effectively

2010-01-21T16:30:00.000+11:00

Risk management is rightly seen as an important governance issue by Not for Profit Boards and Committees of Management. The challenge is how to develop and implement the appropriate framework to identify and manage the risks effectively.

First and foremost is the issue of identification. Undertaking any activity, no matter the size or scope, has inherent challenges and risks. If we accept this basic precept we need to identify what is to be achieved through the development and implementation of a risk management framework.

The primary focus of most Not for Profit Boards / Committees of Management is in achieving the organisation’s Mission, and therefore risk management is generally viewed in the context of “what can go wrong” as we embark on this journey.

One approach to risk management is to list all the things that can go wrong and to develop strategies to eliminate the likelihood of their occurrence and / or to alleviate the real or potential damage to the organisation in the event that they do occur.

The risk to the organisation in this approach is that the focus may be on what can go wrong rather than on what we are doing right and how we can continue to develop and build on our success.

One option is to move this mindset to a change in focus from risk management to a strategy encompassing the organisation’s strengths, challenges, opportunities, risks and ethical dimensions (SCORE). This allows the acceptance of the multiplicity of each of these measures. That is, an organisation’s strengths can also have relevance in determining and assessing the challenges, risks, opportunities and ethical considerations faced by the organisation.

An example of this might be if we consider our staff as one of our greatest strengths; a challenge might be in the retention of the staff; an opportunity is utilising the diversity of skills to broaden the services offered; a risk the lack of awareness of the staff’s activities/ skills outside of the organisation; and the ethical dimension is how we treat our staff.

Risk management therefore transforms from an identification and ranking exercise to a strategy to effectively manage the organisation’s strengths, challenges, opportunities and risks within an ethical framework (SCORE).

Regardless of whether our focus is on risk management or the broader SCORE, the second step in this journey is the need to establish a framework to ensure effective management of the process.

The approach that Enterprise Care recommends incorporates:

Assessment at project level – encourage staff and project managers to develop and document project scopes prior to commencement. Amongst other things the project scope should include identification and analysis of the project’s SCORE;
Appropriate monitoring – establish a process to monitor the status of the project’s SCORE by the project manager;
Reporting framework – develop a reporting mechanism which enables the SCORE and their status to be discussed, as appropriate, at project, staff, management team or Board/ Committee meetings. This will enable a broader organisation approach to the classification and management of common issues across projects to be identified and implemented;
Strategic focus – where changes in the status of any of the SCOREs is likely to have either a significant positive or negative impact on the organisation’s operational targets or future strategic direction these changes should be actioned in terms of priority according to the established reporting framework;
Governance role – the Board / Committee of Management or the delegated committee should, on at least an annual basis, assess the overall framework to ensure its suitability and functionality.

For further information on developing a suitable framework to manage your organisation’s SCORE please contact Mark Rudd on ruddm@enterprisecare.com.au

Ten things companies can do to increase gender diversity in the workplace – Part 2

2009-11-05T12:03:00.001+11:00

Part two of our gender diversity tips

Step 6 Make Mentoring a Priority

“Research shows that mentoring programs can be powerful tools for advancing the careers of professional women. Every young professional can benefit from having a mentor. But for women in male-dominated corporate environments, the need is even greater. Women with mentors, research finds, are more likely to apply for promotions. That changes when managers are given the task of encouraging talented women to move up.”

Do you have a mentoring program in place? Do you know of any women (in your own organisation or others) who could be a mentor for your developing talent?

Step 7 Retain Your Best Women

“What does it take to keep talented women in your organization? Asking them directly is a good place to start in getting an answer. However, research finds that flexible work hours, generous maternity leave benefits and coaching for women returning to the workforce can make a difference.”

Have you recently asked your staff what keeps them attached to your organisation? Research shows that in Not for Profit organisations money is not always a deciding factor in taking or keeping a job. Are you offering the right benefits to keep your best staff?

Step 8 Measure Your Result

“When companies put goals in writing and track their results, things gets done. Companies need to know where they stand and make managers accountable for the level of gender diversity in their organizations. Benchmarks to track include the proportion of women in a company's business units at each level, pay levels of women vs. men at comparable levels, attrition rates by gender and the ratio of women actually promoted to women eligible for promotion.”

Our recent Not for Profit Remuneration Report shows a disparity between male and female remuneration, with nearly all positions reporting higher wages for males over females. Have you benchmarked your pay levels by gender?

Step 9 Plan for Diversity

“Succession planning is the best way to assure the optimal mix of backgrounds, experience, skills and perspectives on boards and among top executives. Companies can use opportunities created by turnover to generate the kind of collective strategic thinking needed to compete successfully in a constantly changing economy.”

Does your strategic plan include a section on succession planning and skills diversity? If not, ensure it is included at the next planning meeting.

Step 10 Move Beyond Tokenism

“According to McKinsey, companies with three or more women in senior management scored higher on measures of organizational excellence than companies with no women at the top. It is not enough to add a woman here or there. The best performers build a critical mass that gives women the power to have their views heard.”

How many females sit on your Board? How many senior management are females? What strategies do you have in place to balance any gender inequity?

Read the full article on Reuters here.

Ten things companies can do to increase gender diversity in the workplace – Part 1

2009-10-22T12:42:00.002+11:00

An article appeared recently on www.reuters.com that listed ten useful tips for companies to assist them in working towards a more diverse gender balance.

Step 1 Work towards “functional diversity”

“Professor Scott Page of the University of Michigan uses this term to capture the idea that we need people with diverse ways of perceiving problems, rather than groupthink, in order to devise better solutions. As a recent Ernst & Young report points out, a group of intelligent problem solvers chosen at random will outperform a homogenous group of even the best problem solvers, under the right conditions.”

Does your organisation have different thinking styles on your Board? Do you nurture ‘outside the box’ ideas or stick with the ‘tried and true’ methods?

Step 2 Send a message from the top

“A report from McKinsey & Co. found that almost all companies that achieved significant change in gender diversity ‘benefited from the personal commitment of the CEO’.”

Does your CEO recognise the importance of gender diversity? What policies has the CEO set in place for nurturing female talent in your organisation?

Step 3 Put more women on your Board

“According to a recent report from InterOrganization Network (ION), an alliance of women's business organizations, board-ready women are not difficult to find. A significant number of qualified women serve in executive capacities in Fortune 1000 companies. Others run large hospitals and non-profit organizations, are active members of industry associations and professional organizations and regularly attend educational and corporate governance programs offered by business.”

A recent article on the Women on Boards website noted that a diverse Board can often times lead to more profitable organisations. The article quotes: “These companies will be able to draw from a broader pool of talent in an era of talent shortages. What’s more, research shows a correlation between high numbers of female senior executives and stronger financial performance.” Furthermore, the article also notes that having more than one female on the Board makes a defining difference on Board performance.

How many women are on your organisation’s Board? How are Board members recruited? Is there a diversity policy?

Step 4 Rethink Human Resources

“As research shows and Inforum's members can attest, corporate HR policies often, inadvertently, hold back professional women at the very stage - in their late 20s and early 30s - when their careers should be taking off. Simple changes could address that. For example, evaluation processes that penalize women for taking maternity leave could be changed so that a woman's tenure with the company includes that time.”

What HR policies are in place to ensure women are not penalised for taking maternity leave? Is there any noticeable bias on the promoting of women of child bearing age?

Step 5 Recruit smarter

“Some simple changes in the way companies recruit new employees could make a big difference. According to McKinsey, companies that simply train recruiters and operational managers on the importance of diversity can make meaningful progress in recruiting women. One European company raised the application rate of women for technical, sales-oriented jobs by 40 percent simply by changing the text on the ad and replacing a stock photo of a man with a photo of that company's senior women.”

Look at your recruitment adverts - do they appeal equally to both sexes? Look at your website and publications – are they oriented towards a particular sex?

Part 2 next fortnight will look at the next five steps to creating a greater gender diversity in your organisation. Or you can read the full article on Reuters here.

Not too much of the inverse proportion rule – please!

2009-09-15T14:06:00.000+10:00

Suppose that ten people can build a house in 20 days.

Does it stand to reason that if we have 20 people then it will only take ten days; and further, if we have 40 people it will be five days; and further still, if increased to 80 people, then it is two and a half days; and finally with 200 people will it only take one day?

Well, we can now observe (from experience) the almost “frantic” activity of governments, committees, observers, media, regulators, activists, ‘experts’, and many others, who having discovered the Not for Profit sector (that mind you has been in existence for many centuries!), want to contribute and be a part of it.

Let’s hope, therefore, that like the 200 people and the house built in a day, that the enormous attention now directed at the sector will see its resources and sustainability enormously increased too!

Sadly I fear that the inverse proportion rule may apply and then ‘implode’; so that just as 500 people don’t build a house in less than half a day, this greater attention on the Not for Profit sector may not deliver the resources and support that will ensure its viability and sustainability.

We need to all work together to ensure that this attention benefits the many who work in, or closely with, this fantastic sector. And that we harness this new-found enthusiasm of the government and media to ensure the long-term viability of our Not for Profit organisations.

Damien Smith
Managing Director

Finance Committees – adding value to your organisation

2009-08-24T10:27:00.001+10:00

The end of a financial year is always a stressful time for staff, especially those involved in completing a number of financial compliance activities, including:

finalising year-end accounts;
completing taxation returns – including GST and income tax;
compiling budgets for the next financial year;
preparing for and participating in the external audit;
compiling statutory accounts; and
completing regulatory and statutory returns - including WorkCover, payroll tax, group certificates etc.

All of these activities are time-consuming and unfortunately have similar deadlines for completion, thus adding to the hours worked and the related stress created for finance and management staff. So what, if anything, can the Board and individual Directors do to ease the burden on staff during this challenging time? One way is for the Finance, or equivalent, Committee to take an active role on a number of key governance matters including:

External audits – the Finance Committee can take the lead in relation to scoping and setting the terms of reference for the external audit. This can be done by direct communication with the auditors and also allows the auditors to be able to report back directly to the Finance Committee, by way of the management letters. This takes the pressure off both the external auditors and the staff in relation to any contentious issues that may be encountered during the course of the audit. It also enables the Board, by way of the Finance Committee, to take appropriate action on any control weakness that may be identified by the external auditors.

Budgets – whilst it is important for staff to have a detailed breakdown of costs for each project, it is more important for the Board to have an understanding of the key financial targets that are aligned to the strategic and operational plans of the organisation. The Finance Committee can play a role in tailoring the budget forecasts into a format that facilitates strategic decision-making by the Board. This may include:

Revenue: identifying key revenue sources, including costs for generating each revenue stream;
Costs: identifying key costs by type – for example, salaries, operating costs, depreciation etc. and division, - for example, core activities, business support, marketing etc.;
Liquidity: calculating high-level cash flow forecasts to determine the amount of "free cash" at any point in time;
Investment strategy: calculating surplus targets and recommending strategy for how the monies are to be utilised - including income generation, risk management, program development and capital expenditure.

Systems and processes – the Finance Committee has a role to play in ensuring the systems and processes in place are the most efficient and appropriate for the organisation. This will include reviewing where time taken to complete tasks may be reduced through automation, training or use of appropriate external experts;

Controls and risks – another important role of the Finance Committee is to review the policies and practices currently in place and to make recommendations to the Board and management where it is felt risks could be reduced or controls strengthened in order to safeguard the organisation’s assets. Such assets include the intellectual property of its core services and the knowledge and experience of key staff; and

Compliance – the Finance Committee can work with senior management and finance staff in ensuring that all statutory and regulatory compliance matters are dealt with appropriately and in a timely manner.

A proactive and responsive Finance Committee can play an important role by ensuring all of the above are in place in advance of the year-end deadlines. This helps to ease some of the pressure on finance staff, in particular, in what can otherwise be a stressful time for those involved.

Should you require further information on how to implement an effective Financial Management framework for your organisation please contact Mark Rudd on ruddm@enterprisecare.com.au

Occupational Health and Safety – Where are you Now?

2009-07-21T11:55:00.001+10:00

Enterprise Care recently conducted a survey on Occupational Health and Safety (OH&S) in Australian Not for Profit organisations. The survey was revealing in that while 99% of all respondents knew they had an obligation to comply with OH&S laws, some organisations did not have appropriate processes in place to manage this.

Briefly, the survey found that:

65% had a living and dynamic OH&S process in place that included regular updates on OH&S changes, reminders and action items;
67 % had a formally appointed and trained OH&S representative;
76% kept up-to-date with OH&S legislation in all operational areas; and
40% had professional process in place to measure OH&S risk.

It is pleasing to see that so many organisations are committed to undertaking Occupational Health and Safety in their workplaces. However, it’s clear that for some organisations, there needs to be a greater emphasis on having formally documented policies and procedures in place in relation to OH&S risk.

Risk management is integral to the continued operation of all businesses, and OH&S should be a major consideration in your risk management plans.

Have you recently measured your organisation’s compliance with OH&S? Answer the following questions in relation to your organisation and then ask the same of all your staff.

Do you have a written OH&S policy?
If yes, is it up-to-date?
Have you identified hazards in your workplace?
Are annual health and safety goals set by management?
Are there any long-term health and safety goals?
Who is in charge of health and safety in your workplace?
Have health and safety responsibilities been assigned?

If you or your staff answered no to any of these questions, maybe it’s time for a OH&S check-up in your workplace…

Confidence …..where art thou?

2009-06-26T10:09:00.001+10:00

The Hudson Report discloses that “Confidence amongst Australian employers has risen for the first time in 18 months.” This is welcome news, as there had been five (5) consecutive quarters of falling sentiment.

In addition, the Hudson Report indicated that there was “a clear shift away from reducing headcount towards holding current employee levels steady.”

In fact the report goes on to state that “the proportion of employers intending to reduce their permanent employee levels decreased” over the last quarter.

Added to this is that employers intending to hold their current employee levels steady increased, as well as employers looking to increase headcount over the same quarter.

The good news, and we always need it, is that confidence amongst Australian employers has risen for the first time in 18 months. The report goes on to comment that the “Intense cost reduction activities appear to be stabilising and employers shifting their focus toward their long-term business strategies.”

A challenging question for us all is whether the reports findings are in accord with our own thoughts, and importantly, actions.

Oh, and by the way, it appears that the National permanent employment expectations over July — September 2009 is around 5% for the Not for Profit sector as compared with all industries of around 7%.

Confidence where art thou?

Damien Smith
Managing Director

Social entrepreneurship – the Not for Profit way

2009-06-10T11:22:00.001+10:00

In a recent article in the Griffith Review by Cheryl Kernot titled “A Quiet Revolution”, social entrepreneurship is discussed at length. Kernot discusses a number of community-based social initiatives - successful and unsuccessful – both here in Australia and overseas. She argues that Australia still has a long way to go in terms of social investment and innovation.

One significant matter concerns what are good practices. Prior to the GFC there was a tendency to hold the private sector up as the model to follow. Today it is clear that all sectors have some practices that are worthwhile. No sector, however, has all the answers.

Extract from the article:

In the days before successful corporate and third-sector partnerships, there was a pervasive business culture assumption that most charities were unbusinesslike and wasteful with their resources and practices. There were frequent calls to measure the efficiency of those who received grants and donations and this became a well-developed area of public reporting.

As a result, successful third-sector organisations have worked hard to ensure that they have learnt the lessons of business efficiency. The First Nations Development Institute, for instance, manages to spend less than a tenth of its budget on its administration and a similar proportion on fundraising expenses so that well over three-quarters of its income reaches its programs.

The daily deluge of revelations of excessive spending on executive salaries, conferences and travel put the old criticism of third-sector inefficiency into a context that makes the inference offensive. The lesson of the new model is that learning needs to occur at both ends of the spectrum; right and wrong are not the sole preserve of either sector.

This reinforces the need to identify the many good governance practices of the Not for Profit sector and adopt them for all sectors.

Visit the Griffiths Review website to view the article below.

http://www.griffith.edu.au/griffithreview/campaign/Ed24_APO/Kernot_Ed24.pdf

Cheryl Kernot is Director of Teaching and Learning at the Centre for Social Impact.

You Spoke – We Listened!

2009-05-14T13:25:00.002+10:00

You may have noticed a few changes going on at Enterprise Care over the past few months. We have begun implementing our marketing and communication’s strategy, which has resulted in a number of significant changes for both members and supporters of EC.

Understanding the needs of our constituents and stakeholders was our number one priority in developing this new strategy. We undertook a number of surveys and a great deal of research to discover what the market wanted and needed, and this was extremely valuable in assisting us with setting the new direction of our communications.

Stakeholder engagement and communication is the cornerstone of our strategy, and we will continue to build on, and improve, our communications to you.

Our New Look

First and foremost, we have rebranded to bring our look and feel more in line with the direction of the organisation. Our new brand image represents the:

values of our organisation: authentic, innovative, accountable and collaborative;
Mission of our organisation: to guide organisations to grow, develop and deliver on their Mission; and
Enterprise Care Governance IntelligenceTM Framework.

Enterprise Care’s member newsletter also underwent a make-over, with an attractive new look and the addition of valuable contributions from the ever-expanding group of EC’s supporters and staff.

And for the biggest change of all, Enterprise Care this week launched our new website (still at the same address www.enterprisecare.com.au), which has more content and valuable resources, as well as being very user-friendly and easy to navigate. Please note that you may need to change any bookmarks you have that direct to the old site.

These changes have been the result of six months hard work by all the staff here at Enterprise Care, and we thank you for your patience as we work out any minor bugs in the new system.

We value your feedback, so if there is anything (good, bad or ugly) about the changes you’d like to tell us about, please feel free to email me anytime at semplea@enterprisecare.com.au.

Alicia Semple
Communications Manager

Constructive versus Destructive Investment

2009-05-04T16:10:00.003+10:00

Recent government announcements relating to the Defence White Paper, housing strategy, budget deficits, emissions trading scheme, paid parental leave and unemployment programs highlight the multitude of challenges faced by any Government. As with any organisation, the Government would be challenged in combining these competing and inter-related priorities into an over-riding Vision, and developing and articulating how it hopes to realise this Vision through its Mission.

The Government will have extensive research to help it understand the complex inter-relationships and cause and effect of implementing key programs to enable it to determine where to prioritise its funding to achieve its stated strategic objectives.

Using the amount of expenditure is one way for the average Australian to identify which objectives the Government believes are its key priorities. With recent articles identifying a major outlay and increase in Government expenditure on defence in the future, it may appear that national and regional security is one of the key priorities for the Federal Government.

Not having access to the same level of information as that of elected politicians and public servants, I have to assume that research and past experience indicates that expenditure in military hardware is more likely to deliver the targeted objective of increased regional stability and national security, than a similar expenditure on improved diplomatic relationships, investment in aid programs and developing greater economic partnerships with key countries in the region.

I am also left to wonder whether sufficient money has been invested by governments, organisations – both corporate and Not for Profit, and individuals to undertake research that will enable informed and transparent decisions, particularly those relating to the desired return on social investment. That is, funding that delivers us with the optimum programs to ensure an educated, safe and well-resourced community, where everyone has an understanding of their role and work individually and collectively towards achieving agreed, transparent targets.

Do you have a clear understanding of the overall strategic direction set by the leaders in government, corporate and the social sector, and the role that your employers and you as an individual have to play to achieve those objectives? What could be done to enhance our knowledge and progress in this area?

Mark Rudd
Director

Board accountability – “Do Something!”

2009-04-21T10:16:00.002+10:00

Board accountability – “Do Something!”

Recent incidents in sporting clubs raise serious questions of the role of Boards and their governance effectiveness.

In the case of the North Melbourne Football Club, little has been heard, let alone seen, from the Chair and Directors in the sorry saga that enveloped the organisation.

Why?

Is it a matter that is “beneath” them? Is it “beyond” their involvement? Is it “too hot” in the kitchen?

Whatever the reason, and let’s hope the Board at least has one, it is not good enough! It is about time Boards assumed responsibility and accountability for what happens at their club. Where is the leadership? Certainly it would appear not to be with the Board.

Surely this is a wake-up call for all Boards to become more involved and accountable for what happens within organisations they have governing responsibility for.

In the immortal words of John Kennedy – “Do Something!” And to paraphrase with apologies to John, “Come off the Board and say ‘I did this. I supported the right club values, the right ethics and culture with the club. I stood for something. At least I did something’”.

Damein Smith,
Managing Director

Community Consultation: are you doing it?

2009-03-31T10:33:00.002+11:00

A recent article on the internet piqued my interest as I was searching for governance related news articles and blogs. It was titled “Hope in Rwanda” and I wondered how it had come to appear in my search results – surely google could not lead me astray!

The paragraph that caught my attention – and obviously the search engine’s attention - was the following:

“In fifteen years, the government and people of Rwanda have written a constitution, established free education for all children, and are rebuilding their economy. They can boast that they have more women in Parliament than any other country in the world. Perhaps the most remarkable changes in political structures and authority have occurred at the local level. In only fifteen years, central control has evolved into devolution of power to the lowest levels. Exclusion has become inclusion; voices are heard from the weakest, poorest and most vulnerable. It is far from perfect but it is building a culture of democracy and accountability."

The article went on to outline the nature of this new form of governance, which can be briefly summarised as:

A set of goals is established through consultation with the wider community, for what is valued and needed by these communities;
These goals become a contract that is signed by the local Mayor and the President;
The contract has measurable performance indicators; and
At every level, leaders are being held accountable for their actions and achievements.

Now, for the most part this is similar to the running of many organisations. But what caught my attention was the emphasis put on the goals of the leadership being determined by the communities themselves.

“…Rwanda is implementing a system that asks poor people to express their needs, which are then developed into a compact with their leaders -- who are held accountable, by being removed from office by citizens if these needs are not met.”

It’s an interesting concept – asking the stakeholders what they actually want and/or need – and then making sure you deliver it to them.

And this may be the perfect time for us all to assess our goals and objectives, and make sure we’re attuned to the needs of our constituents. It certainly couldn’t hurt.

Click here to read the article “Hope in Rwanda”.

Alicia Semple
Communications Manager

Employee Worth ………. Is this the time to have a National CEO Award?

2009-03-17T12:03:00.002+11:00

What are you worth? Is worth for the person different from the position itself? In fact should we solely base any calculation upon making a distinction between the person and the position?

Is it fair to link an employee’s value to the organisation’s performance? For we all know of examples where there are so many external matters that influence the performance to make this meaningless.

Now what is our view about bonuses? Are they inherently beneficial or disastrous? When should a bonus be paid? And should there be an opportunity for a Board to ask a CEO to “hand back” money?

All of these questions are now very timely in the current climate.

Of course given the previous experience around setting remuneration, for many people there is not a lot of confidence that this current storm will deliver a good outcome. Can anyone see if regulating this area will improve how, when and what remuneration will be determined for them?

If it is not regulated, then should the power rest with the stakeholders to decide? Of course if the stakeholders are involved, will this be any better, or is the only real answer the establishment of a CEO National Award?

It is not so silly to suggest that at least a National CEO Award would offer a public benchmark or standard for remuneration. Perhaps even implement a policy where if someone is paid above this benchmark standard, then the directors must provide a written statement of justification for why this is so.

Do you think this could work, and if not what are the alternatives?

Damien Smith
Managing Director

Three hints for helping your organisation through the financial crisis

2009-03-04T10:48:00.006+11:00

The current economic climate is forcing both commercial and NFP organisations to rethink existing strategies and look at ways of cutting costs and/or increasing efficiency. Here are a few tips we have learnt over our 20 years that may help your organisation through these difficult times.

Collaborate with other kindred organisations to:

investigate joint funding opportunities;
make use of bulk purchasing discounts;
meet with other executives and learn valuable lessons about their experiences;
join together to increase your lobbying power to influence policy; and
undertake joint projects to divide and/or reduce costs.

Look at your organisation's effectiveness and efficiency

Examine your organisation’s income. If your income is diverse and doesn’t rely solely on donations or membership fees, you will find it easier to ride out the storm. One of the first places both corporates and individuals can look to cut back in an economic downturn are on donations and membership fees.

Investigate what other ways your organisation can look at providing goods and services to your constituents. What are you doing that could be done better? What could be expanded? Are there any (potentially very costly) things you’re doing just because you’ve always done them? Can an investment in technology save you valuable staff time?

Examine your relationships closely. Now may be a good time to survey your stakeholders on what they actually want from your relationship. Conduct a member / stakeholder / donor survey to rate your current performance and discover any perceived gaps in the market. Electronic survey software is readily available on the internet at competitive prices.

Make better use of volunteer resources

A recent survey by the Stanford Social Innovation Review found that many American NFP organisations were not making adequate use of their volunteer resources. The review found that organisations which took the time to match volunteers to appropriate tasks had happier volunteers, and got better value from those volunteers, than those which allocated tasks randomly.

Take the time to talk to your volunteers and find out where their skills and interests lie. A volunteer who enjoys their work will be more likely to return, and will contribute more to your organisation.

Many corporations are now also initiating social responsibility programs to attract the socially conscious Generation Y employees. Approach businesses to see if they will offer their employees time pro-bono and take advantage of these skills.

You may also like to consider taking on a student. Students will find the experience your organisation offers invaluable for their training, and they may just teach you something new!

For more resources on improving the performance of your organisation, visit the Enterprise Care website at http://www.enterprisecare.com.au/.

Charities and their tax exempt status – new court ruling.

2009-02-26T13:28:00.002+11:00

A recent High Court decision on the tax exempt status of charities may have ramifications for your organisation.

Late last year the High Court of Australia presided over the case of Commissioner of Taxation vs Word Investments Limited.

The case involved a charitable organisation (Wycliffe Bible Translators) taking the taxation commissioner to court over its refusal to grant tax exemption status to Word Investments, which is a commercial enterprise set up by Wycliffe to raise funds for their charitable purposes.

The High Court ruled that, put simply, Word was set up to raise funds for charitable purposes, and therefore should be granted tax exempt status, even though it was run as a commercial business. This decision has ramifications for all charities operating in Australia.

Enterprise Care supporter Cornwall Stodart Lawyers has compiled an informative brief on the decision and its implications for Australian charities. Read the brief on the Enterprise Care website: http://www.enterprisecare.com.au/ebiz/content/wsc.aspx?ID=25

Changes to Not for Profit Regulations

2009-02-05T09:22:00.006+11:00

Damien and I recently attended a presentation hosted by the Australian Institute of Company Directors (AICD) on the future regulation and disclosure requirements for Charities and Not for Profit Organisations. The guest speaker, Senator Annette Hurley MP, gave an overview of a recent inquiry on this topic, including the key recommendations arising out of the inquiry.

Listening to the Senator speak and the subsequent remarks and questions from the attendees it appeared to me that:

The larger Charities and Not for Profit organisations, with some reservations, were generally supportive of the inquiry, the Federal Governments focus on the “Third Sector” and the key recommendations;
The smaller organisations, particularly those with limited resources and funding, were concerned about the potential additional resources and cost to comply with the recommendations;
The Federal Labour Government appears to be committed to implementing the recommendations and is keen to move on some of the recommendations that it believes can be implemented quickly, i.e. in 2009, and with limited adverse impact on the sector;
There is going to be increased expectation for Not for Profit organisations and Charities to disclose key financial data, particularly relating to fundraising, in a new standardised format;
There is likely to be one national regulator for the sector and a desire to have standardised constitutions and laws relating to the governance of all organisations in the sector, irrespective of size and purpose;
The more contentious recommendations, particularly those relating to increased disclosure, transparency and accountability are likely to be deferred until consensus can be achieved after consultation with organisations and other key parties involved in the sector.

In my view it is important for all Charities and Not for Profit organisations to at least familarise themselves with the recommendations and understand how they might impact on their organisations current governance and reporting requirements.

A summary of the recommendations is listed in our latest newsletter, which can be found on the Enterprise Care website at www.enterprisecare.com.au.

Mark Rudd, Director

Welcome to the Enterprise Care Blog

2009-01-08T12:27:00.002+11:00

In business for over 20 years, Enterprise Care are the leading supplier of governance consultancy services in Australia.

The Enterprise Care Blog is designed to be an informal avenue for our experts to share their knowledge of governance matters with EC members and supporters, in an easy-to-read and practical manner. Our experts will offer advice, commentary and analysis of industry trends on a regular basis, keeping you up-to-date with the latest industry developments.

The blog will be accessible as a link from our website, and we also offer the opportunity for you to subscribe to posts as they are uploaded.

We hope you enjoy reading our blog as much as we enjoy sharing our knowledge!