Charities and other community organisations are navigating significant change.
Many are facing rising costs and financial pressures at the same time as demand for services grow significantly. They often operate in complex regulatory environments while responding to some of our most challenging social issues. And no discussion of current leadership challenges (in any sector) is complete without acknowledging the pressure and pace of adapting to rapidly evolving technologies such as artificial intelligence (AI), which is creating new questions for charity leaders.
Across the sector, I see remarkable examples of leadership, from large national organisations to small community groups run entirely by volunteers. I am also conscious of the personal toll this can take. In a sector where people care deeply about the mission, it can be difficult to switch off. For volunteer board members, governance responsibilities often begin at the end of an already busy working day.
The ACNC is here to support you in your governance role. We are not here to second guess day to day decisions you make, but there are some core governance and transparency guardrails you need to understand and stay within; requirements that support public trust and confidence in the sector.
With that in mind, I want to highlight three areas that charity leaders may find useful to reflect on: staying focused on your charity's purpose, looking after your people and planning for the future.
Purpose
A charity's purpose is your reason for being and the basis of your ongoing entitlement to ACNC registration.
One practical way to maintain that focus is to periodically review your governing document, whether that's a constitution, trust deed or set of rules. Your governing document provides the foundation for good governance, setting out your charity's purpose, how decisions are made and who is accountable. Charities are far better placed to govern effectively when their governing document is current and clear.
Purpose is particularly important when charities engage in advocacy. Many charities speak out on issues that affect their communities, and advocacy can be a powerful way to advance charitable purposes.
With State elections approaching in Victoria this year, and in New South Wales early next year, charity leaders need to ensure any public advocacy or campaigning is connected to their charity's purpose. Election periods can provide important opportunities for charities to highlight issues affecting the people and communities they serve. The key is to focus on issues rather than party politics, and ensure any messaging is factual, respectful and within the law.
People
Something I have consistently observed throughout my time in the sector is that the health of a charity is reflected in how well it supports the people who contribute to it, whether they are volunteers, staff or board members.
Culture influences whether people feel comfortable raising concerns, whether risks are identified early and, ultimately, whether a charity can deliver on its purpose.
Charities also have safeguarding obligations to protect the welfare and rights of people connected to their work, particularly those who may be vulnerable to abuse, neglect or exploitation. Leaders play an important role in ensuring safeguarding remains an active focus, rather than something considered only when problems arise.
There are practical resources to help - the Australian Criminal Intelligence Commission maintains information about screening requirements across Australia, including Working with Children Checks, Blue Cards and equivalent schemes. The ACNC’s online safeguarding tool prompts charities to review policies, manage risks and meet legal obligations.
Future
Strong leaders also recognise when challenges emerge, don’t shy away from having difficult conversations and take decisive action when required.
For example, for charities experiencing financial stress, one of the hardest decisions can be acknowledging that existing arrangements may no longer be sustainable. Early conversations with fellow board members, auditors, advisers, funders or lenders can often create more options than waiting until choices become limited.
Remember professional advice, sector networks and guidance are all available to help charities make informed decisions during difficult periods.
The same principle applies to considering new technologies such as AI. Charities are using AI to develop grant applications, support reporting and strengthen communications. While AI can offer significant benefits, it should be used thoughtfully and responsibly.
Governance challenges to deal with new risks are not new (decades ago it was the arrival of the internet). It might be helpful to think about AI in the same way you consider other significant organisational risks: understand how it is being used and could be used, who remains accountable for decisions, and what safeguards are appropriate. Technology can support good decision-making, but responsibility for decisions remains with people.
Future-focused leadership also means preparing for transitions. Annual general meetings provide an opportunity to maintain transparency, appoint new leaders and ensure knowledge is passed on effectively. Encouraging thorough handovers and planning ahead can make leadership transitions smoother and help maintain organisational knowledge.
The challenges facing charities will continue to evolve, and there are rarely simple solutions. What I see across the sector, however, are leaders who are willing to adapt, make difficult decisions and stay focused on the communities they serve. Those qualities will continue to matter in the years ahead.
Sue Woodward AM
ACNC Commissioner