Governance is essential to the success and credibility of every Not for Profit (NFP) organisation. Proactive governance systems help organisations operate efficiently, manage risk and stay compliant, ultimately enabling them to deliver effectively on their core mission. As we approach 2026, it’s the perfect time to reflect on your organisation’s current practices and establish new habits to ensure a smooth start to the year. Below we outline key areas of governance that NFPs should be aware of.
Vision, Purpose and Strategy
An organisation’s vision should serve as the backbone of its operation, shaping decision making and empowering stakeholders to achieve their objectives. Leadership should regularly assess whether the NFP’s actions align with both the organisation’s strategic goals and its broader purpose.
Importantly, an effective strategy should outline practical and actionable steps that can be implemented, rather than relying on theory alone. Clear communication should be expressed from management to all levels of the organisation to encourage accountability and a shared sense of direction.
Financial Compliance and Reporting
NFP organisations must stay current on their compliance and regulatory obligations., ensuring reporting is accurate, timely and in the correct format.
The regulatory landscape is constantly evolving in the NFP sector, requiring organisations to monitor a range of potential obligations, from simple details to complex tax and payroll matters.
There are several useful resources online to help NFPs stay on top of their obligations. The Australian Taxation Office provides guidance on reporting obligations, including checklists and updates (Managing a not-for-profit organisation | Australian Taxation Office). Moreover, NFPs should become familiar with the ACNC Governance Standards, which outline six core principles of good governance for charities and support ongoing compliance (ACNC Governance Standards | ACNC).
Risk Management
Effective risk management protects the organisation’s reputation, ensures regulatory compliance and mitigates financial penalties. NFPs should establish effective controls, internal policies, and monitoring systems.
Consider, is your organisation taking a proactive approach to risk or addresses problems only as they arise?
Board Governance and Accountability
An effective NFP Board should consist of individuals with a mix of diverse skills, experience, and backgrounds. Directors should be selected with a high level of diligence and transparency to inspire stakeholder confidence.
Boards should regularly review their composition and consider whether any critical skills or perspectives are missing, addressing any blind spots. This approach equips the board to make informed decisions, strengthen governance and successfully strive towards its long-term goals.
Positioning Your NFP for Success
For NFPs, regular independent audits not only provide assurance to regulators, donors and stakeholders, but also identify areas for improvement in governance, tax and reporting processes. With a deep level of expertise, our audit practice at Accru Melbourne has built a strong portfolio of long-lasting relationships within the NFP sector. Engaging our team can ensure your NFP is strategically positioned for success.
